Financial Reporting Act 2015
This week Financial Reporting Act 2015 has been brought to light by the Government. The act encompasses the accounting profession of the country. The accounting professionals will be under the close supervision of the regulations bythe FRA Act 2015.
Background of FRA 2015
1 Background of FRA 2015
2 Financial Reporting Act 2015
3 Credits to Finance Minister AMA Muhith
4 Financial Reporting Council (FRC)
5 Transparency &Accountability in Accounting and Auditing
6 Opposite Opinion of ICAB
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The crisis of the stock market of the Bangladesh has become a critical factor for the economy of the country. Since then there was a crying need for monitoring the auditing professions and the accounting. Like other countries of the world, corporate failures and scandals are a bit linked with the accounting profession associated companies. But for ensuring more accountability the FRA 2012 has been proposed by the concerned community in the year 2012. After a three year long justification, the FRA 2015 has been passed.
Financial Reporting Act 2015
The Bangladesh National Parliament has passed the Financial Reporting Act 2015 on September 06, 2015 in a bid to ensure more transparency and accountability in financial-reporting activities in the country. Since the beginning of accounting profession in Bangladesh, Institute of Chartered Accountants of Bangladesh (ICAB) was the one and only governing body for the country’s chartered accountants. But this act is expected to make sure accountability among the chartered accountants of Bangladesh.
Credits to Finance Minister AMA Muhith
There are two bills passed on September 07,2015. They are ‘the Financial Reporting Act 2015’ and ‘The Foreign Exchange Regulation (Amendment) Act 2015’. All the credits go to Finance Minister AMA Muhith who has boldly brought the bills to be endorsed by the Jatiya Sangsad (National Parliament of Bangladesh) by voice vote.
Financial Reporting Council (FRC)
The act aims at elevating the auditing and accounting system of the country’s financial institutions to international standards, and under the act, a Financial Reporting Council (FRC) of 12 members will be established and led by a chairman appointed by the government. Moreover; The council will be a statutory body with members from various government bodies, institutions and professional groups.
Transparency &Accountability in Accounting and Auditing
The FRC will be the watchdog body in order to monitor the function of auditors and ensure transparency and accountability in accounting and auditing of financial organisations, including various government, autonomous and non-government institutions. The act will not only monitor the chartered accountants, but also cost and management accountants of Bangladesh.
Opposite Opinion of ICAB
Earlier this year the president of the Institute of Chartered Accountants of Bangladesh (ICAB)Mr. Abdus Salam said that they find no necessity of a new law to monitor the accountancy profession, as the institution itself is doing the same job by exercising its legislative power. (The Report of the Daily Star)
Ask us here for details on ‘Financial Reporting Act 2015’.
You can download FRA 2015 here..
I read the Financial Reporting Act 2015 recently passed (Passed in September 2015) in the parliament which is highlighted in the website this Article is an excellent one.
So far my understanding due to implementing this New Financial Reporting Act 2015 there will be a controlling system imposed by the Government on the ICAB and ICMAB respectively. From now onward these two organizations will be more conscious regarding their report than earlier.
I would like to recall a report which was published in the Daily Financial express on March 2015 (named Financials of most cos audited by fake firms) from there I had picked some points which is Quoted herein
The Audit Firms certified financial statement of nearly 14,000 companies operating in Bangladesh, while the NBR received such reports from some 55,000 annually.
My question how it was possible in Bangladesh? No effective mechanism to verify these reports. I think submission of large numbers of financial statement not audited by genuine Audit firm report. Such malpractices also widen room for financials irregularities in Company operations.
In a nutshell I would like to say that due to implementing this new Financial Reporting Act 2015 there would a controlling system on the ICAB and ICAMB there would be No malpractice in the years to come on the Company/Companies.
A check & balance was necessary between ICAB & ICMAB. This Act will ensure the segregation of their duties. Moreover, there will be representatives of different financial institutions, Govt. stake & professional bodies which will give it a more credibility from strategic stance. Now hoping for the best.
Mr. Abdul has been in insurance sector of Bangladesh for a decade. He is an Associate Member (ACII) of Chartered Insurance Institute of London.