Investigation and disciplinary functions of ICAB

--Md. Saiful Islam ACA

The Institute of Chartered Accountants of Bangladesh (ICAB) was established under the Bangladesh Chartered Accountants (CA) Order 1973 for the purpose of regulating the profession of accountants and for matters connected therewith. The duty of carrying out the provisions of the CA Order 1973 is vested upon the Council-ICAB and the duties of the Council-ICAB include the exercise of such disciplinary powers over the members and servants of the Institute as may be prescribed. The Council-ICAB discharges its investigation & disciplinary functions as per bye-laws # 128 & 129 of ICAB Bye-Laws 2004. As a member body of IFAC, ICAB is also responsible to undertake investigation & disciplinary activities complying with IFAC SMO-6.

Initiation of Proceedings

ICAB initiates investigation & disciplinary proceedings on complaint-based or on information-based approach. Under complaint-based approach, action is triggered by the receipt of a complaint against an individual member or firm. The information-based approach is not a substitute for the complaints-based approach, but an additional process that offers the public for the protection. It does so by permitting the Professional Conduct Department of ICAB to commence an investigation (even when there has been no complaint) where information is received from reliable sources that indicates the possibility of misconduct. ICAB has the direct responsibility for the overall quality assurance system of the audit firms in Bangladesh. The investigation & disciplinary proceedings may also be initiated, if the Quality Assurance Board (QAB) of Council-ICAB considers that an unsatisfactory conclusion of quality assurance reviews represent serious failing by the firm or partner as recommended to Investigation and Disciplinary Committee (IDC) of Council-ICAB through Council-ICAB.

Investigation & Disciplinary Process

It shall be the duty of the President and/or Secretary on receipt of information or otherwise, and the right of any member or of any aggrieved person to lie before the IDC of the Council-ICAB. On receipt of the complaint IDC gives notice to the member or articled student of its intention to consider the complaint where it considers the fact require investigation.

The Committee forms sub-committee to investigate into the matter considering the weight of the fact. At the outset of an investigation process, the committee confirms the independence of the members of the sub-committee/ investigation team (a) the subject of the investigation, and (b) anyone connected with or interested in the matter under investigation. If a conflict of interest exists at the outset or arises during the investigation, the committee shall withdraw the person immediately from the case. On completion of the investigation, the sub-committee /investigation team shall review the evidence and decide whether there appears to be a case to pursue. If the sub-committee satisfied that there is a case to pursue, the matter shall be referred to the Full Committee with or without recommendation of disciplinary action.

The Full Committee reviews the report of sub-committee/investigation team and assesses the justification of the recommendations of the sub-committee. If Full Committee assumes that there is the possibility of occurring professional misconduct under bye-law # 134 of ICAB Bye-laws 2004, IDC calls the member or articled student for personal hearing before the IDC under the bye-law # 129 of ICAB Bye-Laws 2004. The member or articled student is permitted to appear before the IDC for hearing personally or by counsel or by a solicitor or by a member of the Institute. The IDC shall thereafter report to the Council the result of its enquiry and if necessary, recommends disciplinary action on the basis of guidelines as may be prescribed by the Council from time to time.

On receipt of IDC Report, the Council shall record its findings accordingly and direct that the proceedings shall be filed or the complaint shall be dismissed as the case may be if the complaint has not been proved. If the complaint has been proved, the Council makes any of the order suggested in the bye-law # 130 of ICAB Bye-Laws 2004 after giving personal hearing an opportunity of being heard. The member or articled student is allowed to appear before the Council for personal hearing either personally or through counsel or a solicitor or a member of the Institute. ICAB communicates the notice of the finding and the decisions of the Council to the concern member or articled student and the decision thereupon takes effect. The defendant gets at least 14 days notice each for appearing before the IDC and the Council for personal hearing in the disciplinary process.

ICAB has established the Professional Conduct Department to assist the IDC of the Council-ICAB in 2013. From then, the Professional Conduct Department is also instructed to conduct the investigation in place of forming sub-committee.

Disciplinary Actions Taken by ICAB

The disciplinary actions taken by ICAB in last 14 years are presented below:

Publication of Disciplinary Action

ICAB publishes the council decisions regarding the investigation and disciplinary proceedings under the guidelines of bye-law # 131 of ICAB Bye-Laws 2004. ICAB prepares the summary result of the investigation and disciplinary proceedings and makes available for the stakeholders in its Annual Report every year and the Annual Report is publicly available through website. Recently, ICAB decided to publish the news of disciplinary action in ICAB monthly news bulletin and in ICAB website.

Conclusion

ICAB is very keen to achieve its mission, to promote and regulate high quality financial reporting auditing in Bangladesh, to develop and maintain the competence of professional accountants and enhance the reputation of the accounting profession in all sectors of the economy. In this regard, the duties of the IDC have increased enormously with the demand of stakeholders after the share market debacles and large financial scandals in the Banking Sector. The IDC is working hard with the support of Council-ICAB to promote the accountancy profession to a widely respected profession in Bangladesh.