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Public Caution: Bogus Accountants

January 7, 2022
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Public Caution: Bogus Accountants

The Oxford Learners dictionary defines the word ‘BOGUS’ as pretending to be real. On the other hand, the definition of an accountant is that a person whose job is to keep or check financial accounts.

According to Section 2 of the Accountants Act 1967 (‘the Act’) and Rule 2 of the Malaysian Institute of Accountants (Membership and Council) Rules 2001 (‘the Membership Rules’) which is to be read together with Rule 9(1) of the Membership Rules, a chartered accountant or a licensed accountant is defined as follows:

  • must be registered as a member of the Malaysian Institute of Accountants (‘the Institute’);
  • practices as a sole proprietor or in a partnership;
  • provides or is engaged in public practice services in return for a fee or reward for such services; and
  • holds a valid practicing certificate issued by the Institute.

Furthermore, Section 18 of the Act prohibits members from carrying out the business of auditing under a company incorporated under the Companies Act, trade or association. Members can only carry out the business of auditing as sole proprietors or in a partnership firm with other members of the Institute.

These conditions are essential to ensure that the profession is effectively regulated to safeguard the public. Members who fail to possess these criteria and if found to breach the Act and Rules will be subjected to a disciplinary action of the Institute.

Persons who do not qualify with the conditions required under the Act and the Rules are simply known as the ‘bogus accountants’. These individuals basically provide Public Practice Services illegitimately to the public at large and are seen as a threat not only to the profession but also to the business and public at large. Bogus accountants make unlawful profits and deprive the nation of its rightful taxes. Bogus accountants who do not possess the required qualifications falsify accounts and provide fake information to the clients who have hired them.

Although the Institute does not have jurisdiction over these individuals, the Institute has taken serious and relevant actions to notify the authorities and the public at large of these individuals. When the Institute is made aware of these individuals, the information pertaining to these individuals is advertised in the newspapers to ensure the public is well informed and protected against these bogus accountants.

The public is advised to inform the Institute if they are made aware of information on any bogus accountants.

As the national accountancy body that regulates, develops, supports, and enhances the integrity of the accountancy profession in Malaysia, the Institute will continue to uphold the laws that regulate its members to ensure that members uphold integrity and are trustworthy to secure the credibility of the accountancy profession.

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