The stock market watchdog is formulating guidelines for enlistment of audit firms and auditors that will be allowed to inspect listed companies.
As of now, there are no guidelines, said Mohammad Rezaul Karim, spokesperson and executive director of the Bangladesh Securities and Exchange Commission (BSEC).
The Bangladesh Bank has guidelines, according to which audit firms are given permission to scrutinize banks and other financial institutions.
"The securities regulator thinks guidelines will help ensure minimum standards that audit firms and auditors will have to meet," said Mr Karim.
Last month, the BSEC issued an order and formed a committee to formulate the guidelines.
"This is a very good decision; there should be definite criteria set for making a panel of auditors," Shahidul Islam, chief executive officer of VIPB Asset Management told The FE.
Director of the BSEC Abul Kalam has been deployed as convener of the committee, Md. Al Masum Mirdha and Md. Tauhidul Islam Saddam as member of the committee, and Mr. Tanmoy Kumer Ghosh as member secretary of the committee.
There are nearly 205 audit firms in Bangladesh, according to the Institute of Chartered Accountants of Bangladesh (ICAB). Out of which, 45 are permitted to audit listed firms at present, as per a panel of auditors, prepared by the BSEC.
Earlier, listed organisations were at liberty to choose auditors for examining their financial performance and file reports, and that created scope of manipulation of financial statements to serve ill intentions of the businesses.
To address the problem, the BSEC started publishing a list of auditors following an initial screening. But there are no guidelines for that.
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