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The Accountancy Profession and the Fight Against Corruption

  1. Interview with Managing Director SITE Ltd
  2. Resolving the IPPs issue
  3. Dar avoids Press on IMF issue
  4. ICMAP Seminar

ICMAP seminar discusses the new role for auditors and chartered accountants

August 9 - 15, 1999

With the end of cold war era and initiation of the process of globalization, need to minimize the cushions in cost structure was felt. One of the reasons for these cushions was cost distortions due to poor governance or corruption. In the next millennium the key issue is to fight against cost distortions. In this endeavor accountants will have to play a key role.

In order to update Pakistani professional accountants, Institute of Cost and Management Accountants of Pakistan (ICMAP) recently organized a seminar. The topic was "The Accountancy Profession and the Fight Against Corruption". Mamnoon Hussain, Governor Sindh, was the chief guest while Ahsan Iqbal, Coordinator Pakistan 2010 Programme deliver the key note address. Other speakers were M. Yousuf Adil, Mian Mumtaz Abdullah, Nazim F. Haji., M. H. Asif and Mian Mumtaz Rafee.

Governor Sindh, appreciating the efforts of the Institute said, "ICMAP has organized the first ever seminar on this topic in the country which is being attended by accountants, educationists, professionals from financial institutions and journalists in large number. We need a transparent corporate culture which will be monitored by professionals. In eliminating corruption the role of auditors cannot be undermined. It is the responsibility of the auditors to expose corruption in the corporate sector."

Ahsan Iqbal said, "Pakistan loses approximately Rs 100 billion in the private sector and another Rs 150 billion in the public sector annually due to poor quality. The poor quality is a result of corruption which can be eliminated by prudent accounting and strict auditing. The country has intellectual capital but we also need emotional capital to achieve faster development, competitive advantage and respect for 'Made in Pakistan' label."

M. Yousuf Adil, former president of Institute of Chartered Accountants, quoted from the key note speech of President of the World Bank at IFAC Congress: "IFAC hand book does not specifically mention the word corruption, but with democracy and freedom has become the need for transparency and reliable information. We have seen rampant corruption, by some economic estimates at the cost to countries of a half percentage of GDP growth per year. Most recently in South East Asia, we have seen that lack of disclosure and the curb on free flow of information are the ingredients in financial crises."

Referring to Pakistan situation, Yousuf said: "For decades there has been an incessant squandering of public money that has lead us to a situation that while our per capita income is still less than US$ 450, our public debt has escalated to over 100 per cent of the GDP."

Mian Mumtaz Abdullah said: "In Pakistan, the first and foremost limitation is the absence of ethics in all spheres of life. Thus in a society imbibed with corrupt practices it would be an uphill task for the accountant to fight particularly as he is also a member of the ultra corrupt society. The accountant has to face hypocritical attitude. This takes form of biased laws being passed, selective accountability being resorted to and avoiding action against the powerful corrupt in society. The limitations faced by accountant are aggravated by the role of the management as well. The accountancy profession can do a lot to restrain corruption but we should not expect miracles from accountants as they have to work under various limitations."

Nazim F. Haji, Secretary General, The Reformers, said: "All our problems are created by ourselves. Given the sincerity and sense of commitment, there is no reason on earth why we cannot turn things around. While I am bullish on Pakistan, let me also warn you that nations, which don't wake-up and do not grip the bull by the horn are relegated into the garbage of history."

M. H. Asif, Secretary ICMAP said: "The cancer of corruption can be checked only through concerted and sustained efforts by all, although there is enough cause for pessimism, the Jehad must go on and professionals like the accountants are the best to set examples of integrity and lead the way.'

Mian Mumtaz Rafee, Secretary General Transparency International, Pakistan, provided some evidences of imprudent use of foreign funds and public money in Korangi Water Management Project. This has resulted in cancellation of US$70 million loan by the Asian Development Bank.