Hong Kong Accountants Urged To Strengthen Self-Regulation Plans

by Mary Swire, for LawAndTax-News.com, Hong Kong

20 May 2003

The UK's Association of Chartered Certified Accounts (ACCA) has urged the Hong Kong Society of Accountants (HKSA) to strengthen its regulatory reform plans in the wake of a number of accounting scandals in the SAR and United States.

The HKSA last year proposed the creation of an independent investigation panel to deal with false accounting allegations involving listed companies and financial service providers such as banks and insurers. However, according to the South China Morning Post, the ACCA believes that although this is a good start, it does not go far enough in tackling the problem.

'It is not good enough to have an independent panel in charge of investigating accountants, it remains the duty of the HKSA to handle disciplinary issues after an investigation,' the British industry body's newly appointed president, Sam Wong King-on announced.

Under the HKSA's self-regulation plans, penalties for malpractice would still be decided upon by an internal committee, a state of affairs which Mr Wong believes could undermine public confidence in the industry.

'Following the outbreak of scandals in recent years, it has become a worldwide trend for accountants to give up the self-regulation model. We have to scrap a system which could be seen as insiders regulating insiders,' he observed.

The SCMP revealed, however, that the Hong Kong accounting body has politely rejected the ACCA's suggestions, explaining that: 'Hong Kong is very different from Britain and we cannot follow exactly the British regulation model for accountants.'

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