13 Sep 2020

Parliament has passed a Financial Reporting (Amendment) Bill.

The bill sought to correct anomaly in the Financial Reporting Act (FRA) 2010 and Accountants Act, which showed duplicate roles of Botswana Accountancy Oversight Authority (BAOA) and Botswana Institute of Chartered Accountants (BICA) in the regulation of auditing the profession.

Finance and economic development minister, Dr Thapelo Matsheka, said duplication of efforts in the regulation of auditors that was done by BICA and BAOA created a gap in oversight of certified auditors since the two entities had different review methodologies.

‘’This makes the enforcement of sanctions difficult and consequently leads to offenders going unpunished and audit quality standards also continue to be below acceptable levels,” he stated.

Furthermore, Dr Matsheka said review of Financial Reporting Act would bring oversight and regulation of auditors under BAOA.

He said bringing auditors within one roof, would therefore reinforce their oversight and significantly enhance accountability.

The bill also sought to broaden mandate of the authority by re-defining public interest entities to public bodies, defined as boards, tribunals, commissions, councils, committees, other body corporate or incorporated established under any enactment.

“This covers any company in which government has an equity shareholding,” he said.

Dr Matsheka said in order to facilitate the process of instituting appropriate sanctions against violation of its provisions, the bill laid down acts and omissions that constitute professional misconduct.

The bill further strengthened sanctions for breach of the act by public interest entities, officers, firms and certified auditors.

“Reinforcing the law with respect to such sanctions will act as an effective deterrent for breach of the ACT,” he said.

Parliament also learnt that the bill established an independent accounting oversight committee to handle appeals against decisions of the board of the authority without any undue influence from the board.

He said the bill expanded and clarified other operational and administrative issues relating to among others, the quorum of the board, alignment of the year end of the authority with that of government, the authority’s primary source of funding and new definition of terms. ENDS