Good reform needs strong rules

The Finance Act 2026 has introduced an important procedural reform under Bangladesh's Income Tax Act 2023. Section 73 now requires all companies and unincorporated larger businesses to submit IFRS-based audited financial statements audited by a Chartered Accountant (CA), along with an Income Computation Sheet (ICS) certified by a Chartered Accountant (CA) or Cost and Management Accountant (CMA) or Income Tax Practitioner (ITP). This certification has also been made mandatory for other certain businesses regardless of their incorporation status and size. The reform deserves recognition, but its success will depend on a sound regulatory framework.
An ICS is more than a tax calculation. It is prepared from audited financial statements prepared under International Financial Reporting Standards (IFRS), which Bangladesh has adopted as its financial reporting framework. The Income Tax Act also requires qualifying businesses to submit such audited statements with their tax returns.
Certifying an ICS therefore requires more than knowledge of tax law. It demands an understanding of how IFRS affects taxable income, including revenue recognition, leases, financial instruments, impairment, provisions, foreign exchange differences, fair value measurement and deferred taxation. These are matters of professional judgement, not mechanical computation.
This is why tax certification in many jurisdictions is linked to professionals with practical experience in IFRS-based reporting, statutory audit and tax reconciliation. In Bangladesh, practicing CAs have developed this expertise through audit, assurance and tax work, where they routinely assess how accounting treatments interact with tax law.
India offers a useful example. Its mandatory tax certification regime is not limited to a professional signature. Statutory tax certification is performed by practicing CAs within a detailed framework covering eligibility, reporting formats, documentation, professional responsibility, digital verification through the Unique Document Identification Number (UDIN), quality review and disciplinary oversight. The purpose is not exclusivity, but reliability and public accountability.
Bangladesh's amendment, by contrast, identifies three categories of certifiers but leaves key questions open. It does not clearly prescribe the applicable standards, required documentation, independence safeguards, quality monitoring or a common regulatory framework for all authorised certifiers.
This distinction matters because tax preparation and tax certification are not the same. Preparing a return is a compliance service; certifying a statutory tax document is a public-interest function that gives the tax authority confidence in the reliability of submitted information. Such functions require ethics, continuing professional development, quality assurance, practice inspection and disciplinary oversight.
Bangladesh already has a strong foundation. The Institute of Chartered Accountants of Bangladesh (ICAB) operates a Document Verification System (DVS) that generates a Document Verification Code (DVC) for statutory audit reports, and the NBR already recognises it for audited financial statements. Extending this system to ICS certification would improve authenticity, transparency and regulatory efficiency.
Where the law requires financial statements to be audited by a practicing CAs, , it is logical that the related ICS-derived from those audited statements-should also be certified by a practicing CA holding a valid Certificate of Practice. This approach reflects the close link between financial reporting, audit and tax computation, and is consistent with international practice where tax certification is tied to audited accounts.
The real issue is not simply who should certify, but whether every person entrusted with statutory certification is subject to equivalent professional regulation, competence requirements and public accountability. Without clear rules and a properly defined class of competent certifiers, as seen in countries such as India, Section 73 of Income Tax Act 2023 may fall short of the National Board of Revenue (NBR)'s objective and could unintentionally increase the cost and complexity of doing businesses.
So, to make Section 73 effective, the government may issue comprehensive rules on the scope, standards and methodology for ICS certification and define competent certifiers and require equivalent standards on ethics, training, quality assurance, practice review and disciplinary oversight.
It is also necessary to prescribe a standard ICS Certification Report and extend ICAB's DVS and DVC to such certifications. The framework should be developed in consultation with NBR, the Ministry of Finance, Bangladesh Securities and Exchange Commission (BSEC), Financial Reporting Council (FRC), ICAB and recognised business representatives.

The writer is Partner, Rahman Rahman Huq, Chartered Accountants, and Council Member, ICAB.
mehedihasan@kpmg.com