Confusion revealed over disciplinary procedures

Paul George

There is confusion between the profession’s disciplinary body and the accounting institutes over how to start prosecutions of wayward qualified accountants.

In a report released today the Professional Oversight Board (POB), it lays out recommendations to clarify issues and end disagreement over the process for bringing rule breaking accountants to book.

The two routes are either initiation by the Accountancy and Actuarial Discipline Board (AADB) or referral from an institute.

In practice POB says the two methods have been mixed up and should be separated.

The comments come in POB’s annual report to government.

Paul George, Director of the Oversight Board, said: ‘The primary purpose is to report on our oversight of audit regulation carried out by the professional accountancy bodies that we recognise for this purpose. We focused in 2007/08 on key areas of risk at each body and on those regulatory systems where there had been significant recent change.

‘Overall we conclude that the recognised bodies take their responsibilities extremely seriously and that much regulatory practice is of a high standard. However, the detailed comments in the report highlight those aspects of regulatory activity that are less strong or where there is room for improvement.’

Among the other observations are:

Audits have been signed off by people who are not entitled to. POB said institutes do not make it sufficiently clear to members who can sign off an audit

Accountants are qualifying but it remains unclear how they gained the necessary practical experience to qualify. POB says institutes need more robust procedures for reviewing records of experience.

There is also concern in the report that small firms are finding it difficult to acquire enough work to provide staff with the right experience and that the decline in audit staff is making succession more difficult.