The Institute of Chartered Accountants of Bangladesh (ICAB) is ready to welcome the proposed Financial Reporting Act (FRA), if it is formulated 'based on professionalism and to ensure benefit of the nation economically, efficiently and effectively', its top official said.
"Being the regulator of accountancy profession, the ICAB is always in favour of any rational reform that enhances the transparency and accountability in the country's financial sector," Showkat Hossain FCA, President of the ICAB, told the FE.
The ICAB President said these when his attention was drawn to a recent report on likely passage of the much-talked about FRA bill in the upcoming session of Parliament.
Mr Hossain, however, said that the FRA would create a conflicting situation in the accounting profession. Favouring his position, he mentioned some relevant provisions of the Companies Act and the proposed FRA.
"We are afraid that due to the inherent limitations of the FRA, its ruling will be self- defeating and will seriously affect the profession in the long term," Mr Hossain said.
He further said the proposed FRA was not drafted based on the idea from UK FRC, USA PCAOB and the ground reality in our country's context; even, there is no existence of such type of Act in any SAARC country.
The ICAB president was also at variance with the reported comments, made by the securities regulator's officials and spokesperson regarding the ICAB and the proposed FRA.
Regarding the BSEC officials' comment on need for FRA to fulfil a condition for getting ADB fund for the capital market development project, he said, "It will be a shame for the nation, if any contradictory body (FRC) is formed referring to the fund disbursement of any donor agency."
About another allegation of taking 'little' action against CAs by the ICAB for their professional misconduct, he said, "The allegation is not true; we have taken and are taking strong punitive measures against the guilty CAs; actions against a good number of CAs also remain under process."
In a query, Mr Hossain said, "From now on, the complainants and the accused persons will be informed about all the measures taken against the guilty CAs. News about all such actions will also be regularly published in the monthly bulletin of ICAB," he added.
"The ICAB suspended membership of three Chartered Accountants (CAs) from public practice in listed companies since 2011. During the time, it also reprimanded 20 CAs and suspended licence of a CA firm. After completion of inquiry, punitive measures are under process against three CAs, and the institute is now conducting probe against 25 CAs," AKM Rahmat Ullah FCA, ICAB Secretary, said.
"Shifting of one's responsibility to another is very common practice now- a- days; each regulator should know their scope of work, responsibility and accountability. Being the regulators of the listed entities or the audit firms, if we make mistake to explain our roles and duties and blame others for own errors, other stakeholders will never find the right track," Mr Hossain said.
"One thing need to be clear that the company's management is responsible for preparation and presentation of the financial statements, and at the same time other parties such as auditors, lawyers, issue managers, actuaries and the regulators including ICAB and BSEC cannot shrug off of their defined responsibilities," the ICAB president said.
The Bangladesh Securities and Exchange Commission (BSEC) has the authority to ask if any fraud relating to the presentation of financial statements came to its knowledge, and even can penalise the company, he said.
Emphasising on need for professional competence to properly review and analyse the financial statements and be an effective regulator, Mr Hossain expressed the ICAB's keenness to impart training to concerned officials of BSEC as it did so for the concerned officials of Bangladesh Bank, NBR and MRA.
