The Hong Kong Institute of Certified Public
Accountants (HKICPA) said it is against a proposed law introducing
criminal liability for poor audit work.
A clause contained in a Companies Amendment
Bill will make the previously-self-regulating profession criminally
liable in case the auditor “knowingly or recklessly” omits a
required statement.
HKICPA chief executive Winnie Cheung said
consequences and harm to the profession would be huge if the law is
passed.
Instead the institute has proposed to amend
the prosecution threshold introducing liability only when an
omission is committed “dishonestly or with intent to defraud”.
HKICPA pointed out the clause will not
actually apply to non-Hong Kong companies, which represent 75% of
the market capitalisation of the Hong Kong stock exchange.
However, talented young members of the
profession will seek other career options with fewer risks and the
quality of the profession will suffer, Cheung said.
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By GlobalData“Imposing a criminal liability on the
managerial positions will only aggravate the job pressures and push
aspiring young professionals away from public accounting
service.
It will gravely impede the healthy development
of the audit profession,” Cheung concluded.
