KARACHI, Feb 21: The Institute of Chartered Accountants of Pakistan (ICAP) said that its Quality Control Review (QCR) Programme was designed to ensure that audits were performed by ICAP’s members in accordance with the International Standards of Auditing and meet requirements of the local laws and regulations.

In a press statement issued on Thursday, ICAP stated that the President of the Institute, Hussain A. Basrai along with certain council members had called on the SECP chairman, Khalid A. Mirza and made presentations to him and his colleagues on the Institute’s QCR Programme.

The ICAP team also described the Institute’s investigation procedures on cases of professional misconduct. “ICAP’s Investigation Committee includes a member of the Auditor General’s Office, a nominee of the Karachi Stock Exchange and an independent senior Advocate to ensure transparency, and that necessary disciplinary action is taken by the Institute to fulfil its role in regulating the accounting profession in accordance with the Chartered Accountants Ordinance, 1961 and the bye-laws made there-under”, the ICAP stated.

The Institute said that it had informed the SECP that it welcomed the recent directive to the stock exchanges relating to QCR, which would facilitate the programme initiated by ICAP. “However, the Institute has formed a committee including some past presidents to study various implications of SECP’s directive to the stock exchange, which proposes debarring of auditors found guilty of professional misconduct and restricts the auditor of a listed company from providing other services to their audit clients”, the ICAP observed.

It said that ICAP recognizes its obligations to ensure effective regulation of practising accountants including enhancing the quality of audit, ensuring independence of auditors in line with IFAC Code of Ethics and to endeavour to narrow the perception gap which exists amongst the various stakeholders, accountants and regulators. It also recognizes the need for proactivism on the part of the regulators and self-regulatory bodies in view of international developments and increasing concerns and emphasis on quality of audit and conduct of auditors particularly auditors of listed companies. “ICAP in this context is making all its efforts on the one hand to expedite the disciplinary process within its current constrained regime of law and on the other hand to expedite the amendment of the ICAP Ordinance and Bye-laws which will ensure more independent and transparent process of investigation and discipline and its expeditious disposal”.

The Institute stated that it was also conscious of developments all over the world and considered that ICAP and SECP had common objectives and those could be better achieved with closer interaction and continuous consultation process; the recent meeting with SECP was an effort in that direction. ICAP said that the Institute and SECP should work together and share their resources and burden.

ICAP being a professional body had resources to guide on technical matters, and had a due role as a self-regulatory body, whereas SECP as a regulator was there to safeguard the larger interest of the society. “ICAP however, considers that the emphasis on good corporate governance and effective monitoring of the role of various corporate players including directors, stock exchanges and accountancy profession would be imperative; a process of continuous improvement needs to be in place but all of this would need to factor the ground realities and the prevailing corporate culture, where transition has to be smoother and effective, rather than volatile, so that the objectives could be achieved in a cohesive manner”, ICAP stated.