Signing of RMA with CPA Canada
The Institute’s reciprocal membership agreement (RMA) with CPA Canada (formerly Canadian Institute of Chartered Accountants) has been renewed with effect from 1 June, enabling eligible members of each body to apply for membership of the other body without further examination or test. Further details for Institute members interested in applying for CPA Canada membership can be found on the CPA Canada website, while CPA Canada members interested in joining the Institute may refer to our website.
Institute raises suggestions for effective implementation of the Greater Bay Area Initia tive with representatives from Guangdong government
The Hong Kong Coalition of Professional Services (HKCPS) organized a delegation of its member bodies to visit Guangdong on 1 and 2 June. Patrick Law, Vice President of the Institute and a member of the board of HKCPS, led the Institute’s delegation.
During the visit, the delegation met Guangdong government representatives and requested that the government relax the requirements that the partner of an accounting firm must reside in Mainland China for no less than six months every year; and the main shareholder/partner of an accounting firm must be a Mainland citizen. The Institute also asked to add Hong Kong CPAs who are Hong Kong permanent residents but not members of the Chinese Institute of Certified Public Accountants to the list of “Other Professionals” eligible to take up partner positions in special general partnership firms. In response, the government officials committed to making continuous efforts to open the Greater Bay Area (GBA) market.
The delegation also visited new trans- port infrastructure designed to support economic development in the GBA.
Becoming an insolvency specialist
The Specialist Designation in Insolvency is open to members with considerable experience and competencies in insolvency practice, and who have gained the SQ (Insolvency). Holders of the Specialist Designation in Insolvency are entitled to use “SD (Insolvency)” after their names. The current round of applications will close on 6 August.
Current Affairs Series
Over 370 members attended the Current Affairs Series seminar on 22 June where Matthew Cheung Kin-chung, Chief Secretary for Administration, shared his insights on how the new business opportunities brought by the Greater Bay Area and the Belt and Road initiatives will drive the continuous growth and prosperity of Hong Kong.
The Hong Kong and Guangdong CPA alliance meeting
Hong Kong and Guangdong CPA alliance meeting
A meeting for the Hong Kong and Guangdong CPA Alliance firms, jointly organized by the Institute and Guangdong Institute of Certified Public Accountants (GDICPA), took place this month. Led by the Institute’s Vice President, Johnson Kong, nearly 30 Hong Kong delegates including representatives from Alliance firms and SMP Committee members, were joined by over 40 of their Guangdong counterparts led by Yuan Qing, Secretary General of GDICPA.
RSCP Singing Competition winner Natalie Tam with Institute President Eric Tong
RSCP annual dinner and singing competition
Institute member Natalie Tam won the solo category at the Recreation and Sports Club for Hong Kong Professional Bodies Singing Competition on 26 May. The event featured exciting performances by singing contestants, including lawyers, barristers, doctors, dentists, architects and surveyors, infront of more than 180 attendees.
Institute’s annual Sports and Recreation Night
Members are invited to join the fun and frivolities of the upcoming Sports and Recreation Night on 27 July. Meet your fellow CPA athletes or reconnect with old teammates at the dinner party. Enrol by 11 July.
Council meetings minutes
The abridged minutes from the April and May Council meetings are now available for members to read. They can be found in the “Members’ area” of the Institute’s website.
Yan Kwok Ting, Sunny, CPA
Complaint: Being guilty of dishonourable conduct.
Yan was employed by Core Pacific-Yamaichi Capital Ltd. (CPYC) as personal assistant to the head of corporate finance. During that time he was a licensed person under the Securities and Futures Ordinance (Cap. 571). In January 2005, the Securities and Futures Commission (SFC) commenced an investigation into due diligence work performed by CPYC in sponsoring a listing on the Growth Enterprise Market board. The SFC started the investigation after finding CPYC’s earlier submissions to the Stock Exchange of Hong Kong gave an unjustified impression that the due diligence work on the sponsored listing was sufficient.
During the SFC enquiries, CPYC’s head of corporate finance submitted new evidence to the SFC which ostensibly allayed his responsibility for the earlier misleading submissions to the Stock Exchange. Yan provided information in a statutory declaration and in an interview with the SFC, which attempted to support the validity of the new evidence. The SFC determined that the new evidence was fabricated or forged, and the information provided by Yan was also false. On this basis, the SFC concluded Yan was guilty of providing false or misleading information to the SFC. He was prohibited from re-entering the industry for 4 years.
Yan later applied to the Securities and Futures Appeals Tribunal (SFAT) to review the decision of the SFC. The SFAT dismissed the application after an extensive hearing.
Decisions and reasons: Yan was removed from the register of CPAs for 5 years with effect from 13 June 2018 and was ordered to pay costs of the disciplinary proceedings of HK$262,499. When making its decision, the Disciplinary Committee noted that the SFAT based its conclusion on a careful and comprehensive survey of the evidence which indicated that Yan was aware of the falsity in the new evidence. The committee further noted it was clear from the SFAT’s verdict that Yan had given materially false or misleading statements to the SFC, which was clearly dishonourable conduct. The committee found Yan’s conduct amounted to a serious breach of integrity, which is a fundamental requirement of the profession. His failure to cooperate with the Institute at an early stage led to additional time and expense being incurred, warranting the award of full costs to the complainant.
Yeung Tat Kwong, CPA (practising)
Complaint: Failure or neglect to observe, maintain or otherwise apply professional standards issued by the Institute.
The Institute received a referral from The Law Society of Hong Kong about the Accountant’s Reports issued by Yeung, in which he failed to report breaches of the Solicitors’ Accounts Rules by a firm of solicitors over three years. The firm did not prepare client account reconciliations, client ledgers and office ledgers. During the Institute’s enquiry, Yeung was unable to provide copies of his working papers, claiming that the hardcopies were misplaced and his computer hard disk had failed.
Decisions and reasons: Yeung was reprimanded and ordered to pay a penalty of HK$100,000 and costs of HK$49,335. When making its decision, the committee noted in particular that Yeung’s reasons for the unavailability of the working papers were highly unsatisfactory, and his failure to act as a proper safeguard to monitor the compliance of solicitor firms involved public interest.
Chan Kin Cheong, CPA (practising)
Complaint: Failure or neglect to observe, maintain or otherwise apply (i) the fundamental principle of integrity under paragraphs 100.5(a), 110.1 and 110.2 of the Code of Ethics for Professional Accountants; (ii) Hong Kong Standard on Quality Control 1 Quality Control for Firms that Perform Audits and Reviews of Financial Statements, and Other Assurance and Related Services Engagements; and (iii) Hong Kong Standard on Auditing 500 Audit Evidence.
Chan is the sole proprietor of Dynamic Dragons &Co., CPA and TCY CPA Limited (collectively “the practices”). He is responsible for the practices’ quality control system and the quality of the practices’ audit engagements. When carrying out a practice review, the reviewer found that the practices failed to implement adequate quality control systems. Also, a number of significant deficiencies were found in the reviewed engagements. In addition, Chan was found to have provided false and/or misleading answers in the practice review and in the electronic self–assessment questionnaire.
Decisions and reasons: Chan was reprimanded and ordered to pay a penalty of HK$60,000 and costs of the disciplinary proceedings of HK$34,175. When making its decision, the Disciplinary Committee took into consideration the particulars in support of the complaint, the parties’ submissions, the conduct of Chan throughout the proceedings and his personal circumstances.
Details of the disciplinary findings are available at the Institute’s website.