KARACHI: The Institute of Cost and Management Accountants of Pakistan (ICMA Pakistan) has strongly opposed the establishment of an ‘Accounting Standards Board (ASB)’ under the exclusive domain of Institute of Chartered Accountants of Pakistan (ICAP) and has clarified that ICMA Pakistan is not a part of such a Board.

While referring to news appearing in local newspaper about formation of ASB, the Institute maintained that the mention of ICMA Pakistan’s representation in the composition of ASB is altogether incorrect and baseless, as the National Council of Institute has not nominated any member on such a Board.

It further stated that proposed ASB under ICAP would not serve the purpose of justice and independence; rather it would create doubts about the standard setting process and adoption of financial reporting best practices in Pakistan. It added that the international operational independent model need to be adopted as in many countries like USA, UK, Australia, Mauritius, Sri Lanka, Malaysia, Hong Kong etc, autonomous ‘Financial Reporting Councils’ have been established and functioning effectively outside the domain of the accounting profession with powers to regulate financial reporting practice and take punitive action against non-compliances. ICMA Pakistan expressed surprise that instead of following the global practice, a contrary approach is being adopted to form a self-regulated Accounting Standards Board that would ultimately damage the financial reporting practice in the country.

ICMA Pakistan has called upon the Federal Minister for Finance Ishaq Dar to intervene in the matter and direct ICAP to dissolve such a Board and initiate process to form an independent Financial Reporting Council or Authority outside the domain of accounting profession in line with global practice.—PR