Cost and management accountants, experts and professional groups hailed the passage of 'The Financial Reporting Act (FRA) 2015' by parliament as they think the new law will help ensure transparency and accountability in financial reporting.
Besides, according to them, it will elevate the auditing and accounting system of the country's financial institutions to international standards.
However, leaders of the Institute of Chartered Accountants of Bangladesh (ICAB), one of the major stakeholders of the new financial law, refrained from making any comment on the issue.
Most of other stakeholders hoped the FRA would play a vital role in protecting public and general investors' interests, ensuring transparency, accountability and good governance in the organisations of public interest and publicly listed companies.
It will make the companies accountable to the regulatory body and bring back discipline in the financial institutions.
Welcoming the new law the Institute of Cost and Management Accountants of Bangladesh (ICMAB) expressed its willingness to extend all-out cooperation in making it a powerful and real independent body on which general investors and public can rely.
"I believe that FRC will protect the interest of public and general investors and restore trust and confidence of the prospective investors in Bangladesh's capital market," said ICMAB president Abu Sayed Md. Shaykhul Islam FCMA.
"FRC will address all finance-related public demands. I am confident that this will encourage both local and foreign investors to invest in Bangladesh, which in turn will bring momentum in our capital market, increase investments and jobs and reduce poverty," the ICMAB president added.
The Jatiya Sangsad passed Sunday the much-talked-about Financial Reporting Act 2015 in a bid to ensure more transparency and accountability in financial-reporting activities, amidst a row between two professional groups -- ICAB and ICMAB.
Under the act, a Financial Reporting Council (FRC) will be formed through gazette notification. The 12-memeber council will be led by a chairman appointed by the government. The council will be a statutory body with members from various government bodies, institutions and professional groups.
The watchdog body will monitor the function of auditors and ensure transparency and accountability in accounting and auditing of financial organisations, including various government, autonomous and non-government institutions.
Finance Minister AMA Muhith moved the bill in the House and it was endorsed by voice vote. However, some amendments proposed by some Members of Parliaments, including proposal for sending back the bill to parliamentary committee for further scrutiny, were all voted out.
Stock-market analyst Prof Abu Ahmed of Dhaka University also highly appreciated the law as a wonderful piece of legislation.
"The law is very important for a country like Bangladesh. It should have been enacted much earlier," said the DU professor. "Anyway, it is better late than never."
According to him, it will increase the confidence of investors as the companies from now on will have to be accountable to a strong regulatory body.
Credit Rating Information and Services Ltd (CRISL) president and CEO Muzaffar Ahmed also highlighted the new law, urging all to work together wholeheartedly to bring fruits of the newly enacted law.
A good number of stockbrokers also expressed their optimism about the market after enacting the new law which they said might bring back disciple among the companies most of which, they said, are playing foul. "If these companies are checked against playing foul, automatically there will be a confidence among the investors," said one stockbroker.
The move to introduce the FRA started in 2008 following suggestions of market experts, stakeholders and the securities regulator as the auditors responsible for window-dressed balance sheets cannot be brought under the scanner in the absence of an effective regulatory body.
On August 19, 2013 the cabinet approved the draft of the Financial Reporting Act (FRA) aiming to ensure transparency in audit systems, form a regulatory body for monitoring firms listed with stock markets and financial institutions.
The move triggered debate among the stakeholders. It also sparked regulatory conflicts between the two major stakeholders - the Institute of Chartered Accountants of Bangladesh (ICAB) and the Institute of Cost and the Management Accountants of Bangladesh (ICMAB).
mzrbd@yahoo.com
ICMAB hails FRA, ICAB keeps mum
FE Report | Published: September 08, 2015 00:00:00 | Updated: November 30, 2026 06:01:00
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