KARACHI: A Stakeholders’ Conference organized by the Institute of Cost and Management Accountants of Pakistan (ICMA Pakistan) in joint collaboration with the Federation of Pakistan Chambers of Commerce and Industry (FPCCI) has stressed upon the need for revisiting the SECP draft Listed Companies (Code of Corporate Governance) Regulations 2017 so as to safeguard the interests of professional accountants, business, industry and other stakeholders.
The SECP had invited comments on the draft legislation by 14th September 2017, however on the plea of ICMA Pakistan and other stakeholders that sufficient time has not been provided; the SECP extended the deadline for submission of comments to 30th September 2017.
In addition to Karachi, ICMA Pakistan is organizing similar stakeholders conferences at Lahore and Islamabad to elicit view of all stakeholders. The meeting at Karachi was largely attended by professional accountants including CAs and CMAs, experts, government officials and representatives of business and industry.
Mohammad Iqbal Ghori, President ICMA Pakistan presented the welcome address in which he said that Institute has already submitted its provisional comments to SECP and the input received from participants of stakeholders’ conferences would be consolidated and final recommendations would be submitted to the SECP.
While presenting observations on specific sections of draft CG regulation, he pointed out that at many places the legislation lacks clarity that could lead to ambiguity and misinterpretation. He referred to Section 24 (2) in which the members of professional bodies established outside Pakistan have been allowed to apply for the position of Internal Auditor in the Listed companies in Pakistan. Mr. Iqbal Ghori opined that such an adverse provision would restrict market of qualified Pakistani professionals and negatively impact accounting profession. He urged upon the SECP to do away with this Section.
Commenting on Section No 32, Ghori stated that this Section does not provide an independent mechanism for appointment of external auditors in listed companies. He added that composition and structure of existing ‘Audit Oversight Board’ is controversial as it lacks independence and dominated and influenced by one profession.
He suggested that the Audit Oversight Board should be dissolved immediately and in its place an independent ‘Financial Reporting Council (FRC) may be formed as per global practice and standards, having representation from all recognized bodies of professional accountants, academia, law, industry and other stakeholders.
Wali Muhammad, Acting President FPCCI in his speech appreciated ICMA Pakistan for taking the initiative to organize the conference on matter of significance for the corporate sector and society. He said the code of corporate governance may need to expand the horizon in global context and link with regulations to stop corruption and illegal black money.
Khawaja Ehrar ul Hassan, Honorary Secretary in his presentation dwelled upon governance and control with special reference to the draft CCG Regulations. He referred to different provision of the said law and presented the practical issues that merit attention of the regulator for revision.
Mansoob Hassan, FCMA compared various provisions of the Companies Ordinance, 2017 vis-à-vis the Listed Companies (Code of Corporate Governance) Regulations.
The conference was followed by an interactive question and answer session. The vote of thanks was presented by the President ICMA Pakistan in which he summed up the main recommendations and assured that the same shall be included in the Institute’s final recommendations. He said that corporate governance is not a set of regulations; rather it is a mind-set that needs to prevail at the board and management levels. News Desk
