SECP Vs. Chartered Accountants.

[zubair]

It is the regulatory duty of ICAP to ensure that its licensed auditors comply with auditing guidelines. Yet if SECP has to to take the role of desciplining the auditors, i wonder what is the role of ICAP then. However, in theory, SECP can ask the government for a legal amendment to compel ICAP to police the licensed auditors in a more proactive manner.

It is difficult to fine companies for wrongdoings. Instead the directors of the companies should be accountable for any qualification in auditors report.

on the third point of reading a qualified audit report re investments.... I believe it is inappropriate to conclude that funds were embazzeled, when the auditors have expressely stated that they were unable to form an opinion. It could be just a case of inadequate documentation, we should not always put on the hat of investigative readers, but should try to assess the situation with reference to other matters in the financial statements and other qualifications.

Lstly, if the auditors report has 3 or more qualifictions, should the auditors not disclaim their liability as a whole as so many qualifications might lead to the inability of auditor to form an opinion.

[Pervez]

Hi friends!
Yes i didn't check the board for past 48 hours. Any guess why?
U r right, the good old blackout hit eastern seaboard on thursday evening. We are still facing rolling blackouts. It feels like we are back in Karachi (with 30 degrees tempratures and no power, the only things missing are Bundu Khan's Kababs & Students' Biryani!!!)
Yeah, so Raza, i am glad ur state of confusion was lifted in reasonably short period of time!!! Oh Man, how did u manage to read ur C.A. exams in time I wonder!. Or u might have written on your answer book "Since i don't understand your question, don't blame me for not answering it correctly. Next time, could u please be more specific in your question"<img src=icon_smile_big.gif border=0 align=middle><img src=icon_smile_big.gif border=0 align=middle><img src=icon_smile_big.gif border=0 align=middle><img src=icon_smile_big.gif border=0 align=middle><img src=icon_smile_big.gif border=0 align=middle>
As for Mr Zubair's comments. Welcome aboard Mr Zubair. Your posting is so serious, it will take me a while to digest what u said. So keep tuned, we are too polite at this board to let a new guest getaway with even remotely reasonable opinion.
And Guybrush did u use Ophelia for Ophelestas(was this one of those obsecure Greek Godesses we poor Pakistanis supposed to know all about)
Man! strange coincidence, that is my mother-in-law's first name!!!
Enough to frighten the day lights out of me!! No problem i am getting used to living without lights & airconditioning! Now i fully understand what Bowman goes through on a daily basis. It does affect your sanity after a while!!!
Keep laughing fellows, crying is for women(except Summaan) & Saddam Hussain's enemies!!!!!
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[Bowman]

Welcome to the Club....... Atlast someone <img src=icon_smile_big.gif border=0 align=middle>

[Pervez]

Hi Bowman!
Let us not get too excited! I am one of those who strongly believe that God created "Adam & Eve" not "Adam & Steve". Besides, co-hibiting has never been my favourite way of living!!! So unless u can locate a seperate tree top i am not calling U-Haul.
Take care
P.S it will be nice if i can have a view of a river or water-fall
from my tree, willing to exchange extra apples or mangoes for
that.

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Edited by - Pervez on Aug 17 2003 101958 PM

[smraza]

I dont know pervez, why didnt u understand my question, as it is very much clear from the topic, at last i ll say that SECP dont have Chartered Accountants, this is the only reason that it is too much against CAs, the Mr. Khalid Mirza expressed his thinkings about Chartered Accountants in the open forum, i want to ask that person, dont he look at the income tax department, how much corruption is there, the people there have mahrab on their faces, with long beard, but they use to ask for money like they are asking for their right, why dont any SECP or Govt. Authority takes any action againt this corrupt department, i will not take any action, as they are also getting shares from there, but Chartered Accountants dont give any share to them, this is main reason of SECP being Against the Chartered Accountants.

S M R

[Pervez]

Hi Raza!
I thought this debate was long over. My last posting on this subject was on 17th of August. So were u in comma for 13 days or u ran out of ur medicines. Anyway, if u r losing sleep on this topic, why don't u go to SECP's office, demand to see one of their officers and tell them exactly what u want to know. Tell them that u r a CA/CA student, and demand a satisfactory answer. If they don't provide u with this answer, then call ur lawyer and file a lawsuit against them.
Otherwise, u will be mentally tortured for rest of ur life. We certainly don't want that. Do we?
Take Care and Good Luck with SECP!!!
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[smraza]

Ha ha ha ha Pervez,
well said, we live in pakistan, where the rule "jis kee lathi us kee bhains" is followed, first i go to SECP, and complain overthere, if i dont find satisfactory answer, then i should go and file a suit, HA HA HA HA HA doesnt it seem funny, we live in pakistan yar (again), we have a lawsuit regarding our land since 20 years, and nothing has been done so far, this is the situation of our courts and you are asking me to go there <img src=icon_smile_big.gif border=0 align=middle>, as far as my mental torture is concerned thanx for being worried about me, i would like to say, i never take tension for such kind of things, rather i enjoy it, as you know we are pakistanis, and sonay pay sohaga we are muslims, we are the corrruuppiiiiieeeessssstttttttt (if i knew the super duper lative degree of corruption then i must have used overhere) thats why the world hate us, (i mean pakis and muslims) bcaz we are different in our sayings and actings, some body (i think George Barnadsha) said very correctly that Islam is the greatest religion of the world, but its followers are the worst people, we all say that we are muslims, but we do everything which is forbidden in Islam, and Islam in our opinion is just to keep the women in pardah, (as i mentioned earliar in any other forum), so dear pervez, I used to enjoy whenever i go to IT Department and SECP even, the situation which i usally observe, and i just post that on this site <img src=icon_smile.gif border=0 align=middle>

S M R

[Pervez]

Hi Raza!
<font color=black>I am glad u r taking the whole situation in lighter vein (mood).
Yeah, i remember those awful days when i used to visit all those govt. offices my self. It was liking visiting a funeral home. The customers were the dead bodies and govt officials like vultures ready to pounce on them. I am glad i am out of that morgue house.</font id=black>
<font color=green>But the theory behind this corruption is a little different in my view. It cann't be blamed soley on our religion. If u see other muslim-arab countries like UAE,Kuwait,Bahrain,Saudi Arabi, of course there is corruption but not to that stinking degree.
However, if u see poor Muslim countries like Indonesia, Pakistan, Bangla Desh than the graph of corruption goes up.
But if we see poor Hindu or Christian countries (for example Phillippines is the only christian country in Asia, corruption is almost identical).</font id=green>
<font color=red>The only exception to this general rule of poverty breeds corruption, is seen in countries with majority chinese population when they were poor (example Singapure, Taiwan, Hong Kong etc). Although Mainland China is rumored to be corrupt as well but final verdict on it is still not out.
Now we in Pakistan have a special case. We have to go deep in Indian subcontinent history for this. I know this is heavy and boring stuff, but those who have passion for it will like it.
Remember 3000 years B.C., India has Mohenjodaro and Harappa. These were original indians. We know they disappear all of a sudden. Many theroies abound for their disappearance. But one suggests that people from Central Asia known as Aryans came over and pushed these people further south. Then there were a wave of foreigners that came to india. Let us start with Mughals in India. When mughals were ruling india, the official language was Farsi rather than urdu or hindi which was more widely spoken than Farsi. So if ordinary pple want some of their work done, they have to deal with govt. in a language that they were not familiar with. This created a need for a middle man who can say write their application in Farsi or talk to the official who speak Farsi as well. Now this middle man needs to be compensated (a genuine charge for services rendered). But over time these middle man became very powerful. The more money was to change hand the more was their cut. So this was the modern beginning of bribery in Indo-Pak.
Later when English came and invented civial service, the problem remained same. Only Farsi was replaced with English. The baboos in govt. offices have control over files. They could prepare a favourable or unfavourable summary for Gora Sahib (who would invariably go with their recommendations). So the clerks and head clerks became all important in govt. offices and court system.
Unfortunaley, independence both for India and Pakistan did not bring a fundamental change. The head of dept was changed from Gora Sahib to Brown Sahib. As u know bad habits die hard.
[purple]My only hope is that with fast changing technologies, we could possibly reduce the number of these infamous baboos. Case in point is the issuance of National I.D Cards. Now my knowledge here is obtained from newspapers as i am not on the ground. But what i read is that this dept has developed a database which is an envy of many developing and even developed nations. They have received requests to export this system to other countries. I know at one time in order to obtain an ID card, u had to go from pillar to post and still had to grease somebody's palms. I hope this system has elimiated this problem.
So u see dear, bribery and corruption are twin evils produced by poverty and history of the place. Religion is less to be blamed for it. Because a Hindu magisterate in India is as corrupt as a Muslim
magisterate in Pakistan.
I hope u read what all i wrote. It wouldn't solve SECP problem but it may bring some perspective to the situation </font id=red>
Take Care
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[smraza]

Dear Pervez, thanx for the knowledge, i was thinking i m reading Pakistan Studies <img src=icon_smile_big.gif border=0 align=middle>
anyway, i think i could not express my opinion in my last post, i never meant that religion is to be blamed, but i was telling that we are different in our actings and sayings, this is creating a bad image of Muslims and Pakis as well, what do u think will a foreign investor will invest in our country keeping in view the prevailing conditions of our country. especially I.T. Department.

S M R

[Pervez]

Hi Raza!
<font color=black>U r right there. Lately, i have acquired a new past-timereading ancient indian subcontinent history. This is fascinating stuff. In fact, i am researching my own personal ancestry. Have u seen the movie "roots" (something along those lines).I think the best way to improve urself is to know urself first. This can only be achieved through knowledge about ur past. I tell u this internet is unbelievable. The only problem is time. I wish they have more than 24 hours in a day!!!</font id=black>
<font color=red>Now to the question will foreign investtors come to Pakistan?</font id=red>
<font color=black>As u know the nations of west are facing a very big problem now and in near future. The problem is their aging population. These westerns had very low birth rate [they have other diversions than to produce children]. Therefore, they are looking for new markets. Any country that has population around 200 million such as Pakistan, they cann't simply ignore. Plus Pakistan has an added advantage of educated workfoce. How many graduates do u think we are producing in different fields? Thousands if not millions. Therefore Pakistan is an attractive country. The infrastucture problems will not piss these corps off for long. Don't forget these are powerful entities. Some of them have more cash and clout than our govt. Therefore, they will get their way in most of the matters. This I.T. officer who u said has a mehrab on his face and long beard and asking for bribe, when he will face a multinational, he better know the nearest bathroom in his office. Becuase if he doesn't play ball with them, they will chew him up in a matter of seconds. Therefore, i conculde that forces of change are working from outside rather than from inside the country. I predict the change is comming fast. I advise u fasten ur seat belts and be ready for the ride of our life.</font id=black>
Take Care
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[smraza]

Aaaaaahhhhhhhhhhhhh,
Waiting for that day Pervez, which seems quite far away at the moment <img src=icon_smile.gif border=0 align=middle>

S M R

[Pervez]

Hi Raza!
I know there are several stages before one accepts the reality. The first one is shock, second denial and third eventual acceptance.
You are at the stage of denial. In fact the power has shifted from Islamabad to IMF and Washington D.C. You will see soon how IMF micro manages our economy. Listen, when they want they force us to raise our electricity and gas prices. If this is not loss of sovereignity than what else is? Unfortunately, this is not such a bad thing. I would rather live under a foreign master than a domestic one. At least the foreign master will treat everybody equally, the domestic master will only think of his clan and province.
Therefore, be prepared for more changes in economic policies that favour foreign investors over domestic ones. Eventually the MNCs will be more powerful than any other force in the country. I don't see anything wrong with it.
Take Care

[smraza]

<img src=icon_smile.gif border=0 align=middle> <img src=icon_smile.gif border=0 align=middle> <img src=icon_smile.gif border=0 align=middle> <img src=icon_smile.gif border=0 align=middle> <img src=icon_smile.gif border=0 align=middle> <img src=icon_smile.gif border=0 align=middle> <img src=icon_smile.gif border=0 align=middle> Good forecasting Pervez, but we cannot reach to the thinkings of goras, its really beyond our thinkings.
i m not at the stage of denial but "Absolute Denial" <img src=icon_smile_big.gif border=0 align=middle>
S M R

Edited by - smraza on Sep 01 2003 73140 PM

[smraza]

Hi pervez,
we diverted the topic to other way,
as i started the topic due to the one sided decisions of SECP, SECP is the regulatory authority for Companies and Auditors as well, ICAP is the regulatory authority of Auditors, i m not against the SECP, but i was just telling people the attitude of SECP towards Chartered Accountants, SECP never penalized any company, can u tell me the name of any company who got its report qualified and on the basis of that qualification SECP took any action against that company, if u know then please let me know, it will be a precious addition to my knowledge,(also it will cool down me against SECP <img src=icon_smile_big.gif border=0 align=middle>) i m sure that u r not gonna tell me any name, bcaz SECP never took action against the culprit companies, It just used to call auditors in the court, thats why in my opinion SECP is not interested in regulating the companies, it just shows its "Cruel Intentions" against Chartered Accountants. <img src=icon_smile.gif border=0 align=middle>

S M R

[Pervez]

Hi Raza!
I remember from my visit to Multan city (it was a long long time ago), that they have a place called Ghanta Ghar. And every famous street in the city finally converges at this place. So you have raised this question from every angle and i have tried to reply as best as i could. So if you wouldn't give up neither will I. Here we go agian....

My dear just becuase an auditor has qualified a report does not suggest that any illegal activity has taken place. The very fact that the auditor deemed it fit to remain associated with the co and issue an audit report(although qualified) suggests that auditor is atleast not aware of any illegal activity. If he was aware of an illegal activity, he should immediate withdraw from the assignment and if deemed appropriate should notify relevant authories (including SECP).
So think hard and tell me how SECP can take an action on the basis of a qualified audit report. Are you telling me that a qualified audit report suggests that an illegal activity has taken place in the co? I certainly hope not. Becuause that will betray an utter lack of knowledge about qualifying an audit report.

I hope this was not your last posting. For what i like about you is the persistency of efforts and frankness of opinions which i don't find very common among our fellow citizens (I am the first one guilty of this crime!) And despite whatever i might have said somewhere else in a lighter vein, i do think that CA program is best course for an accountant (At least in Pakistan) and every second that you spend in the program is worth it. I don't want to brag about it, but my friend i know some very senior people in CA profession in Pakistan.
Mr Yousuf Adil was our accountant when he had very few clients. His is an example that we all should be proud of and be ready to follow. It just shows that if you are determined you can do anything in life. I also know Asad since 1980 when he was in ACMA program with me.

So i hope you have not taken anything too seriously about our discussion. It is the duty of a senior person to guide and lead his junior fellow professionals.

I remember we had an accounting professor by the name of M A Khan in our college days. He never used to take a class for less than 3 hours. He used to say that students are like iron it takes a long time for them to get hot and than only you can mould them whatever way you like. So remember that "Sona Aag Se Nikal Kar Kundan Bunta Hai" Same is true for accountant. You have to burn yourself before you become Gold.

Take care and keep up the morale!




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