Council election and annual general meeting
The Council election is an important exercise for the Institute. Members are urged to exercise their right by selecting seven candidates to join the Council for the year following the annual general meeting (AGM) on 9 December. Voting for the election closes on 6 December. The candidates’ Personal Information Sheets and additional campaign materials, if any, are available on the Council election 2021 webpage on the Institute’s website. Members can cast their votes either by ballot paper or by e-voting, but not both.
More information on registration to attend or view the livestream of the AGM, submission of questions prior to the AGM and the proxy form, are available on the Institute’s website.
Mandatory CPD requirements for 2022 membership renewal
The 2022 renewal notice was sent to members on 8 November. Members are required to file their annual return with their continuing professional development (CPD) declaration and pay their annual fee by 15 December to renew their membership. Members must complete 120 hours of CPD in a three-year rolling period, of which 60 hours must be verifiable. Renew or check renewal status via the Institute’s website.
The Compliance 2021 Annual Report out now
The Compliance 2021 Annual Report is now available on the Institute’s website. The report outlines the Compliance Department’s key activities and statistics for the year ended 30 June 2021. It also features the process review of the department’s operations carried out by the Institute’s Regulatory Oversight Board.
Learn more about LegCo representative candidates
A virtual forum will be organized on 6 December where the candidates for the accounting functional constituency will present their election platforms ahead of the Legislative Council (LegCo) General Election, which will be held on 19 December. There are four candidates standing for election: Man See-yee, Wong Chun-sek, Edmund, Wong Wang-tai, and Yung Kin. Join this forum to learn more about the candidates’ election platforms before voting for your LegCo representative. Enrol by 2 December.
Mentorship Programme 2022-23 open for applications
Join the Mentorship Programme 2022-23 to enrich your professional development or contribute to the profession. Members with less than seven years of post-qualification experience may apply to become a mentee, while those with seven or more years, a mentor. Visit the Mentorship Programme webpage to learn more about the programme and how it has helped both mentors and mentees. Applications must be submitted by 14 January.
Council meeting minutes
The abridged minutes from the October Council meeting are now available for members to read. They can be found in the “Members’ area” of the Institute’s website.
Settlements
Chan Shek Chi CPA (practising) and Yu Kwong Fat CPA (practising)
The Hong Kong Institute of CPAs has settled regulatory proceedings concerning alleged breaches of its professional standards by Chan Shek Chi CPA (practising) and Yu Kwong Fat CPA (practising).
The matter concerns audit deficiencies identified from the Institute’s practice review of Cheng & Cheng Limited. The review covered the corporate practice’s audit of the consolidated financial statements of a Hong Kong listed group for the year ended 31 December 2016. Chan was the engagement director, and Yu was the engagement quality control reviewer.
The practice reviewer found that the audit team failed to obtain sufficient audit evidence, and prepare adequate documentation, on material sums of deposits paid by the listed group for investment opportunities. Deficiencies were also noted in audit procedures performed and documentation prepared on trade and other receivables, inventories, deferred tax liabilities, stock options issued, legal claims, and property, plant and equipment. Furthermore, certain relevant audit working papers were left out of the final assembled audit file.
As a result of the above:
a) Chan failed or neglected to observe, maintain or otherwise apply Hong Kong Standard on Auditing (HKSA) 230 Audit Documentation, HKSA 500 Audit Evidence and the fundamental principle of Professional Competence and Due Care in sections 100.5(c) and 130 of the Code of Ethics for Professional Accountants; and
b) Yu failed or neglected to observe, maintain or otherwise apply HKSA 220 Quality Control for an Audit of Financial Statements.
Settlement agreement: The Council of the Institute has agreed with Chan and Yu that:
1. Both of them acknowledge the facts of the case and areas of non-compliance with professional standards;
2. Both of them be reprimanded; and
3. Chan pay a financial penalty of HK$100,000 and costs of HK$25,900, and Yu pay a financial penalty of HK$50,000 and costs of HK$12,950.
Chan Chi Kwong, Dickson CPA (practising) and Sum Chun Ho CPA (practising)
The Hong Kong Institute of CPAs has settled regulatory proceedings concerning alleged non-compliance of its professional standards involving Chan Chi Kwong, Dickson CPA (practising) and Sum Chun Ho CPA (practising).
The matter concerns significant audit deficiencies identified from the Institute’s practice review of JH CPA Alliance Limited. The practice review covered an audit of the consolidated financial statements of a Hong Kong listed company and its subsidiaries for the year ended 31 December 2016. Chan was the engagement director, and Sum was the engagement quality control reviewer.
The practice reviewer found that the audit team failed to obtain sufficient audit evidence, and prepare adequate documentation, on a number of material financial statements items pertaining to the subject company’s acquisition of a business. Those items comprised a promissory note issued by the company as part of the consideration paid, a profit guarantee given by the vendor of the business, and impairment of the goodwill acquired.
As a result of the above:
a) Chan failed or neglected to observe, maintain or otherwise apply HKSA 230 Audit Documentation, HKSA 500 Audit Evidence and HKSA 540 Auditing Accounting Estimates, Including Fair Value Accounting Estimates, and Related Disclosures; and
b) Sum failed or neglected to observe, maintain or otherwise apply HKSA 220 Quality Control for an Audit of Financial Statements.
Settlement agreement: The Council of the Institute has agreed with Chan and Sum that:
1. Both of them acknowledge the facts of the case and areas of non-compliance with professional standards;
2. Both of them be reprimanded; and
3. Chan pay a financial penalty of HK$75,000 and costs of HK$63,000, and Sum pay a financial penalty of HK$60,000 and costs of HK$31,500.
The Institute considers a settlement on the agreed basis to be in the public interest. In the circumstances, the Institute is satisfied that there is no purpose to be served in pursuing disciplinary proceedings.
Details of the settlements are available on the Institute’s website.
