Sunday, November 1, 2020

BIA prepares for new company act

The Botswana Institute of Accountants (BIA) recently held an Auditing Updates Seminar for its members in Francistown. The seminar was meant to facilitate BIA members’ Continuing Professional Development (CPD) and, to a lesser extent, to prepare them for the challenges posed by the new Company Act. It is hoped that the seminar will help local accounting firms to meet the rigorous internal quality control measures that have been instituted to review auditors’ professional practice and enhance professionalism in the accounting industry.

BIA, a member of the International Federation of Accountants, was compelled to establish twinning agreements with ACCA so that they could meet the enormous membership obligations of the federation and to meet the high global standards that the federation has set. In the twinning agreement ACCA will assist BIA in CPD monitoring and Practice Review. By the end of this year, BIA should have in place a system through which it can monitor its members and ensure that they meet the required credits for CPD. Practice reviews by ACCA on the other hand are expected to start by August this year.

As part of its Continuing Professional Development program and to prepare its members for the enormous challenges that lie ahead, BIA engaged Hens Heymans, of South Africa’s ProBeta Accountancy Development, to hold an Auditing Updates Seminar in Francistown and Gaborone. The seminar covered Quality Control Process, Quality Control, Working paper principles, Audit Planning, Risk Assessment, conducting the audit and finalizing the audit.

It is also expected that BIA’s CPD program will assist local accountants in preparing for the challenges that are posed by the new Company Act which came into effect on July 3. Speaking to The Sunday Standard last week BIA council member Carlos Chiveshe of Chartacc Accounting Services said that most companies have in the past shirked their responsibilities and avoided auditing their accounts, especially because they were not legally bound to do so. This led to poor business practice and lack of accountability. But with the introduction of the new Companies Act, all companies with a minimum annual turn over of P5million and assets totaling P2million are legally bound to present audited books of accounts. The act goes on to state that only accredited BIA members can perform such audits. It reads ”… a person shall not be qualified to be appointed as an auditor of a company unless that person is a member of BIA and qualified under the institute to conduct an audit and holds a valid practicing certificate issued by the institute”.

Chiveshe said that the act was also partly meant to sieve unscrupulous auditors and accountants who have in the past not adhered to BIA rules and regulations. The Sunday Standard is reliably informed that some fly-by-night individuals have been providing audit and accounting services to companies when they are neither qualified to do so nor accredited to the BIA.

”We are aware that there are some fly-by-night individuals who have been providing dubious accounting services to companies leading to presentation of false statements and audited books of accounts, and this act will help to eliminate such individuals,” said Chiveshe.

According to Hank Heymans though the review process covers accounting firms in East, South and Central Africa, Botswana, through BIA, is the only one which has so far acceded to the review process. He added that ACCA’s review will be concentrating more on the quality of the accounting firms’ services and not necessarily on output quantity.

Meanwhile, BIA has also moved to accommodate company secretaries who are now required by law to be accredited to the institution. While Section 162(3) of the act states that the secretary of a public company can only be a qualified auditor, a member of BIA, Southern African Institute of Chartered Secretaries and Administrators or a legal practitioner, many local companies have been providing secretarial services when they do not meet the required criteria.

When the act was effected a lot of local consultants raised complaints that they were being pushed out of business because they did not have the requisite qualifications to join either BIA or SAICSA. The Sunday Standard is informed that BIA is the most favoured of the accreditation institutions as more company secretaries have expressed a willingness to join it, and the institute has moved to accommodate the company secretaries and assist them in the accreditation process.

Speaking at a recent BIA seminar, newly elected President, Priya Iyer, said that company secretaries have a mountain to climb in order to meet the demands of the new act and the BIA has a mammoth task of educating its members and the general public on the new changes.

BIA Chief Executive Officer, Duncan Majinda, told The Sunday Standard that BIA will conduct specific training seminars for the company secretaries to equip them with the relevant skills after which they will receive accreditation certificates which they will attach when submitting registration applications for their clients to the Registrar of Companies.

But Majinda warned that in line with BIA’s continuing development program, accreditation will not be a once off exercise and the company secretaries will be required to attend development seminars and satisfy the program’s requisite credit hours. ”If they fail to do that we will revoke their accreditation certificates and they will not be able to practice,” he said.

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