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Wednesday , April 21 2021

The accountant who lost his shadow

The accounting laws and regulations in Kuwait, until the 1970s, followed, for good reason, the old British accounting systems. Taking over the task of auditing the accounts of banks, insurance companies and others required experience and confidence that could not be certain without the auditor obtaining a certificate from a recognized international institution such as The Association of Chartered Accountants or The Institute of Chartered Accountants.

The global audit companies were and still control the audit market of major corporations, leaving small ones for others. In the 1970s, the SABA was the only Arab office that could compete with international offices.

An Arab expatriate who worked as an accountant in one of these international offices did not like this. His desire to expand was limited by not possessing an auditor certificate, but he and his partner opened an audit office, and after he was warned by an external party of the necessity to close his office for violating the accounting norms, he circumvented the decision, as usual, and established an association or center for accreditation of Arab auditors, in the capital of an Arab country and he and those who worked with him subsequently obtained their certificates from that party which became with time a great source of income for him, and he earned a reputation that he did not deserve.

Today, there are several competing Arab parties or associations that grant statutory auditor certificate to whoever he desires, and most of them bear resonant names, but they lack credibility.

The profession of statutory auditor is characterized by its high risk and importance. The office could cause the largest companies to go bankrupt and shareholders lose billions of dollars of their investments as a result of negligence or corruption, and this happened in many cases, in America and elsewhere, including, of course, Kuwait.

Add to this the false testimonies issued by the audit bureaus enabling fraudsters to deceive the shareholders of the companies.

It is important to note here the role of the former Minister of Commerce Khaled Al-Roudhan who was the most productive minister in the history of the ministry in issuing the Auditors Law during his reign which capped many gaps, despite some of its shortcomings.  Historically, the Iraqis were among the first to obtain the certificates of the statutory auditor before everything collapsed in Iraq at the hands of tyrants, and subsequently the clerics.

At the time, the auditor had to work for 3 years in the office as a chartered accountant, and to prepare for the certification before being approved, and all of this went with the wind, and whoever was not even a statutory accountant, had the title of doctor, thinker, political analyst and even predictor of the occurrence of world wars in a specific month.

email: a.alsarraf@alqabas.com.kw

By Ahmad alsarraf

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