"This Bill is an important piece of the regulatory jigsaw to restore investor confidence in our financial markets, after the Registrar of Companies identified audit failure as a contributing factor in the collapse of finance companies," he said.

The Bill now forms two separate Acts.

The Auditor Regulation Act established a new licensing regime for major audits, such as the audits of banks, insurance companies and companies listed on the stock exchange. It will not impact on audits of small and medium-sized companies and non-profit organisations.

It also required the Institute of Chartered Accountants (NZICA) to license auditors, with the Financial Markets authority (FMA) having an oversight role and being responsible for quality audits.

The changes come into force once the NZICA and FMA have established new regulatory systems.

The Financial Reporting Amendment Act consolidates all accounting and financial reporting standards setting into a reconstituted Accounting Standards Review Board (ASRB), to be called the External Reporting Board (XRB).

Until now most standards setting work had been carried out by the NZICA.

"I'm pleased that the XRB will be up and running on July 1, bringing New Zealand's standard setting arrangements into line with international norms and coordinating service delivery. All members of the ARSB have been appointed inaugural members of the XRB and I appreciate their continuing commitment to standards setting in New Zealand," Power said.

The consolidation of standards setting within the XRB will remove the statutory responsibilities the NZICA has in relation to accounting and auditing standards setting.

"I'd like to thanks the NZICA for the outstanding contribution they've made to standards setting in the public interest over the past 40 years, and the professionalism they've displayed throughout the transition to the XRB."