Don’t help fraudulent companies to flourish, FM asks auditors

Kathmandu, Dec. 22

Finance Minister Dr. Yuba Raj Khatiwada on Sunday said that the auditors should be more aware while performing audit of companies and organisations as the IT-based financial frauds and corruption activities had been increasing recently.

"There are fraudulent companies that are developed through fake documents and have fake financial reports and balance sheets. Auditors must not help such companies to flourish," he said while addressing an interaction on 'Professional integrity for combating corruption and fraud' organised by Institute of Chartered Accountants of Nepal (ICAN).

He said that there were fake companies and the auditors are preparing sham balance sheets and financial reports of such firms. "Auditors must not play roles in approving the fraudulent activities of such institutions," said Dr. Khatiwada.

He urged the auditors to keep them updated about the latest financial technology and instruments to support in combating economic crimes.  He also said that every professional ranging from chartered accountant to lawyers must try to uphold the professional integrity and follow the professional code of conduct.

"The government is spearheaded to maintain good governance and transparency with zero-tolerance to corruption. We are enacting many laws for the same," said the Finance Minister.

Chief Commissioner of the Commission for the Investigation of Abuse of Authority (CIAA) Nabin Kumar Ghimire stated that no auditor should work with an intent to cover financial crime and misappropriation.

Auditor General Tanka Mani Sharma Dangal said that while fighting with corruption, it was necessary that every professional was performing within the professional values and norms.

According to him, tax evasion, financial misappropriation and decentralisation of corruption were the major challenges of the present day.

"The global trend show that the private sector is focused in cheating and the public sector is trying to hide corruption," he said. He urged the concerned agencies and professionals like auditors to be cautions as the issue of money laundering was being raised at the international level.

Chairman of ICAN Krishna Prasad Acharya said that the public had felt that there was erosion of integrity in different profession and business. "We want to promote good practice and help the government in curbing corruption," he said.

Spokesperson of CIAA Pradip Koirala said that investigating agencies had less confidence that the audit reports of companies were fair and true. He expressed concerns over the increasing trend of corruption at the local bodies.

Published in The Rising Nepal daily on 23 December 2019.