ACT No. XIV of 2003 AN ACT to amend the Accountancy Profession Act, Cap 281 BE IT ENACTED by the President, by and with the advice and consent of the House of Representatives, in this present Parliament assembled, and by the authority of the same, as follows>-

I assent.

G UIDO D E M ARCO

(L.S.)

President

24th October, 2003

ACT No. XIV of 2003

AN ACT to amend the Accountancy Profession Act, Cap 281

BE IT ENACTED by the President, by and with the advice and

consent of the House of Representatives, in this present Parliament

assembled, and by the authority of the same, as follows>-

(1) The short title of this Act is the Accountancy Profession Short title

and

(Amendment) Act, 2003.

commencement.

Cap 281.

(2) This Act shall be read and construed as one with the

Accountancy Profession Act, hereinafter referred to as “the principal

Act”, and shall come into force on such date as the Minister responsible

for finance may by notice in the Gazette establish, and different dates

may be so established from different provisions or purposes thereof.

Amendment of

In subarticle (1) of article 2 of the principal Act>

article 2 of the

principal Act.

(a) for the definition “ “accountant” and “auditor” ” there

shall be substituted the following definition

“ “accountant” includes an individual or a partnership of

accountants<”< and

(b) for the definition “prescribed” there shall be substituted

the following>

“ “prescribed” means prescribed by regulations under this

Act or by directives issued in terms of such regulations.”.

Article 3 of the principal Act shall be amended as follows>

(a) for subarticle (1) thereof there shall be substituted the

following>

“ (1) No person shall practise the profession of

accountant unless he is the holder of a warrant issued under

article 4 of this Act.”<

(b) subarticle (2) thereof shall be deleted and subarticles

(3) to (7) thereof shall be renumbered as subarticles (2) to (6)

respectively<

(c)

in subarticle (2) thereof as renumbered>

(i) for the words “under either of the articles aforesaid”

there shall be substituted the words “under article 4”<

(ii) paragraph (a) therein shall be deleted< and

(iii) paragraphs (b) to (e) therein shall be renumbered

as paragraphs (a) to (d) respectively<

(d) in subarticle (3) thereof as renumbered, for the words

“auditor” wherever it appears, there shall be substituted the word

“accountant”<

(e)

in subarticle (4) thereof as renumbered>

(i) for the words “one hundred liri” therre shall be

substituted the words “five hundred liri”<

(ii) for the words “five hundred liri” there shall be

substitutted the words “two thousand five hundred liri”< and

(iii) for the words “ten liri” there shall be substitutted

the words “fifty liri”< and

(f) in subarticle (5) thereof as renumbered, for the words

“one thousand liri”, there shall be substituted the words “five

thousand liri”.

For articles 4 and 5 of the principal Act there shall be Substitution

articles 4 and 5

substituted the following>

of the principal

Act.

4. (1) A warrant to practise the profession of

accountant shall be issued by the Minister on the

recommendation of the Board to any person who satisfies the

requirements of subarticle 3(2).

(2) A person holding a warrant issued in terms of

this article may in addition hold one or more certificates issued

by the Board (hereinafter in this Act also referred to as “a

practising certificate”) to practise in such fields of the

profession of accountant, including auditing, as may be

prescribed by the Minister, acting on the recommendation of

the Board, and may not practise in such fields unless he holds

the relative certificate.

(3) The Minister acting on the recommendation

of the Board may make regulations prescribing the

qualifications required for the issue of certificates in terms of

subarticle (2) as well as to regulate their suspension or

withdrawal.

(1) The holder of a warrant issued under article 4

shall be entitled to use the designation “Certified Public

Accountant” as well as the abbreviation “CPA”.

(2) Any person who, not being the holder of a

warrant referred to in subarticle (1), assumes the designation

or abbreviations therein indicated or in any other manner

indicates that he is entitled to practise the profession of

accountant in Malta, shall be guilty of an offence and shall be

liable on conviction to a fine (multa) not exceeding one

thousand liri and in respect of a second or subsequent

conviction to imprisonment for a term not exceeding three

months or to both such imprisonment and the said fine (multa)

not exceeding one thousand liri.”.

5. Article 6 the principal Act shall be amended as follows>

Amendment

of article 6

of the

(a) for subarticle (2) thereof there shall be substituted the

principal Act.

following>

“(2) The chairman and two of the other six members

shall be persons of recognised standing and experience in

business matters or in industrial relations or in the public

service< the other four members shall be holders of a warrant

issued under article 4 and shall be persons of experience in

academic or professional matters. Three of these other four

members shall be appointed by the Minister, one after

consulting the University of Malta and from among a list of

not les than two persons nominated by the said university

from among the teaching staff of the Faculty or Faculties in

which Teaching of and research in the field of accountancy is

organised, and the other two members after consulting the

association or associations, if any, for the time being

recognised as approved accountancy bodies, and from a list

of not less than four persons nominated by such associations

to represent them.”< and

(b) immediately after subarticle (5) thereof, there shall be

added the following subarticle>

“(6) In order to carry out its functions, the Board shall

make use of such funds as the Minister may from time to time

make available to it< as well as such funds as it may under

regulations made under this Act collect as fees or otherwise.”.

Article 7 of the principal Act shall be amended as follows>

(a) for subarticle (1) thereof there shall be substituted the

following>

“(1) The Board shall regulate the accountancy

profession in the public interest and shall have the functions>-

(a) to consider applications for the issue of

warrants under article 4 and to make its recommendations

thereon to the Minister<

(b) to deal with cases of professional misconduct

and other disciplinary proceedings in respect of certified

public accountants including cases leading to the

suspension or withdrawal of any warrant or practising

certificate issued under this Act<

(c) to advise, or make recommendations or

otherwise express its views to the Minsiter on any matter

on which the Minister is to consult with the Board or on

which the Board is to make recommendations to the

Minister or on which the views of the Board are sought

by the Minister<

(d) such other functions as are or may be assigned

to it by this or any other law or as may be delegated to it

by the Minister.”<

(b) in subarticle (2) thereof the words “paragraph (c) or (d)

of” shall be deleted<

(c) in subarticle (3) thereof for the words from “such list

shall include” to the words “of their respective partners” there shall

be substituted the following “such list shall include such details in

respect of warrant holders and of partnerships of warrant holders

as may be prescribed.”< and

(d) immediately after sub-article (3) thereof there shall be

added the following sub-articles (4) and (5)>

“(4) The Board shall exercise its functions under

paragraph (b) of subarticle (1) through Disciplinary

Committees appointed in respect of each particular proceeding

and which shall in each case be composed of five members

appointed by the Board as to two from a list of not less than

ten persons submitted to the said Board each year by approved

accountancy bodies and as to the remaining three members,

at least one shall be person holding a warrant under article 4

who has practised his profession for such period as may be

prescribed. The Board shall appoint one of the said members

being a warrant holder or a person who had been a warrant

holder to be the chairman of the Board.

(5) The Board may with the agreement of the Minister

delegate, under such terms and conditions as it may deem

appropriate and subject to its overall supervision or control,

any of its functions, other than those under paragraph (b) of

subarticle (1) or those under article 4, to an approved

accountancy body.”.

Article 8 of the principal Act shall be amended as follows>

Amendment of

article 8 of the

principal Act.

(a) for the words “after consulting the Board” there shall

be substituted the words “on the recommendation of the Board”<

(b) for paragraph (b) therein, there shall be substituted the

following>

“(b) the professional conduct of accountants, codes of

ethics, standards of competency and integrity and

independence to be kept by the profession, quality assurance

as well as mandatory continued professional education<”<

(c) in paragraph (c) therein immediately after the words

“issue of” there shall be inserted the words “directives”< and

(d) for paragraphs (i) and (j) therein, there shall be

substituted the following>

“(i) the procedures to be followed in cases of

professional misconduct or other disciplinary

proceedings<

(j) the manner in which experience for the

purposes of paragraph (d) of subarticle (2) of article 3 or

which may be required to obtain practising certificates

under article 4, and the persons who may supervise such

practice and experience<

(k) the provision of such information as may be

required from warrant holders by the Board in order to

enable it to carry out any of its functions under this Act<

(l) the procedure of the Board< and

(m)

the punishments, penalties and other

consequences and effects to which a person may become

liable or may take place in the event of any contravention

or non-compliance with any provision of any regulations

or directive issued under or pursuant to this article< so

however that no punishment so prescribed may exceed

a fine (multa) of ten thousand liri, or imprisonment for a

term of one year with or without such fine, or in the case

of a continuing offence a fine (multa) of fifty liri for

each day on which the offence continues, whether or

not in addition to the punishment aforesaid.”.

Article 9 of the principal Act shall be amended as follows>

(a)

in subarticle (1) thereof

(i) for the words “after consulting the Board” there shall

be substituted the words “on the recommendation of the

Board”<

(ii) for the words “if he is satisfied” there shall be

substituted the words “if the Board is satisfied”< and

(iii) for the words “all citizens of Malta” there shall be

substituted the words “all persons”< and

(b) in subarticle (2) thereof>

(i) for the words “the Minister may in granting” there

shall be substituted the words “the Minister may, on the

recommendation of the Board, in granting”< and

(ii) for the words “after consulting the Board” there

shall be substituted the words “on the recommendation of the

Board”.

Article 10 of the principal Act shall be amended as follows>

Amendment of

article 10 of the

principal Act.

(a)

in subarticle (1) thereof>

(i) for the words “two or more certified public

accountants”, there shall be substituted the words “two or

more persons”<

(ii) the words fron “or two or more certified” to the

words “both auditors and accountants” shall be deleted<

(iii) the words from “or, as the case may be” to the

words “of auditors”)” shall be deleted<

(iv) for the words “ the objects of the partnership.”,

there shall be substituted the words “ the objects of the

partnership>”< and

(v) immediately at the end thereof there shall be added

the following proviso>

“Provided that where the practice by a warrant

holder of a field of the profession of accountant requires

the holding of a certificate under article 4 (2), such a

partnership may only practise in such field under such

conditions as may be prescribed>

Provided further that where a partnership may

exercise in any such field it may indicate such fact in or

together with the partnership name.”<

(b) subarticles (3) to (7) shall be renumbered as subarticles

(4) to (8) respectively<

(c) for subarticle (2) there shall be substituted the following

subarticles (2) and (3)>

“(2) No person may be a partner in a partnership of

accountant unless>

(a)

he holds a warrant issued under article 4< or

(b) he holds a degree obtained after a course of

instruction having a duration of at least three years full

time or its equivalent, at the University of Malta or at an

other institution recognised by the Board for the purpose,

or otherwise satisfies the Board that he holds comparable

qualifications, and in each case subjects himself to such

rules applicable to accountants as may be prescribed.

(3) In a partnership of accountants, persons who are

qualified as provided in paragraph (a) of subarticle (2) shall>

(a) comprise not less than sixty percentum of the

partners<

(b) constitute more than fifty percentum of the

partnership’s administrative or management body< and

(c) hold more than fifty percentum of the voting

rights in the partnership>

Provided that in a partnership of accountants which is

authorised to practise in the field of auditing with respect to

paragraph (b) and (c) above the reference to persons qualified

in terms of paragraph (a) of sub-article (2) were a reference

to such persons who also hold such certificate as may be

prescribed under article 4 (2) to practise in the field of

auditing.”<

(d) in subarticle (4) thereof as renumbered, the

words “ or as certifed public accountants and auditors,

or both as the case may require” shall be deleted, and

for the words from “one of the designations” to the words

“or “CPAAs” ” there shall be substituted the words “to

use the designation of certified public accountants and

the abbreviation “CPAs”, as well as where applicable,

to bring to the notice of the public the fact that it may

practise in any field of the profession of accountant for

which a certificate may be required under article 4 (2).”<

(e) in paragraph (a) in subarticle (6) as

renumbered for the words “any act or thing that may be

done” there shall e substituted the words “without

prejudice to any restrictions on any partners or any

special responsibility on any partners that may be

prescribed with respect to partnerships of accountants

which may practise in a field of the profession of

accountant where the holding of a certificate may be

required under article 4 (2), any act or thing that may be

done”< and

(f)

in subarticle (7) as renumbered<

(i) for the words “or “certifed public

accountants and auditors or their abbreviation

“CPA’s” of “CPAAs” “ shall be substituted by the

words “or its abbreviation “CPAs” and, or, bringing

to the notice of the public the holding of any

particular certificate”<

(ii) for the words “a partnership of

accountants or of auditors” there shall be substituted

the words “of such a partnership”<

(iii) for the words “one hundred liri” there

shall be substituted the words “one thousand liri”<

(iv) for the words “five hundred liri” there

shall be substituted the words “five thousand liri”<

(v) for the words “ten liri” there shall be

substituted the words “one hundred liri”.

Article 11 of the principal Act shall be amended as follows> Amendment of

article 11 of the

principal Act.

(a)

in subarticle (1) thereof>

(i) the words “or as auditor” and “or as auditors” shall

be deleted< and

(ii) for the words “ two or more such persons” there

shall be subsituted the words “two or more persons”<

(b) in paragraph (a) of subarticle (3) thereof, the words “or

of auditors”, “or auditor” and “or auditor, as the case may be”

shall be deleted<

(c) in paragraph (c) of subarticle (3) the words “or the

warrant of auditor” and “or auditors” shall be deleted and for the

word “professions” wherever it appears” there shall be substituted

the word “profession”<

(d) in subarticle (4) for the words “insurance policy” there

shall be substituted the words “insurance policy, and shall declare

to the Board that such level of insurance cover amounts to not less

than such minimum level as may be prescribed”<

(e) in subarticle (5) thereof, for the words “five hundred

liri” and “fifty liri” there shall be substituted respectively the words

“two thousand and five hundred liri” and “two hundred and fifty

liri”< and

(f) in subarticle (6) thereof the words “or as auditor” shall

be deleted, and for the words “five thousand liri” there shall be

substituted the words “twenty five thousand liri”.

For the article 12 of the principal Act, there shall be substituted

the following>

Any agreement or other arrangement, as may be

prescribed by the Minister, purporting to exempt an accountant

generally or an accountant who holds a certificate as is refered

to in subarticle 4 (2), from any liability, responsibility or duty

relative to the practise of the profession of accountant

generally or the practice in any field where a certificate as

aforesaid may be required, or except under a policy of

insurance made out under article 11, to identify him against

any such liability or responsibility, shall be null and void.”.

Article 13 of the pincipal Act shall be repealed.

12. Article 14 of the prinicpal Act shall be amended as follows>

(a) immediately after the word “warrant”, wherever it

appears, there shall be inserted the words “or practising certificate”<

(b) in subarticle (1) thereof>

(i) immediately after the words “the Minister” there

shall be inserted the words “ on the recommendation of the

Board”<

(ii) in paragraph (a) therein for the words “ the Board”

there shall be substituted the words “the Disciplinary

Committee appointed under subarticle 7 (4)”< and

(iii) immediately after the word “fraud” in

subparagraph (b) (ii) therein, there shall be added the words

“or of any crime punishable by a term of unprisonment

exceeding one year”<

(c)

in subarticle (2) thereof>

(i) in paragraph (a) therein immediately after the word

“partnership” there shall be inserted the words “, addressed

to the Board”< and

(ii) in paragraph (b) therein for the words “whenever

the Minister” there shall be substituted the words “whenever

the Board”<

(d) in subarticle (3) thereof for the words “the Board”

wherever they appear, there shall be substituted the words “ the

said Disciplinary Board”<

(e) in subarticle (4) thereof, for the words “the Minister after

consulting the Board” there shall be substituted the words “the

Minister, on the recommendation of the Board”< and

(f)

in subarticle (5) thereof>

(i) the words “or section 5” shall be deleted< and

(ii) for the words “as he may deem” there shall be

subsituted the word “ as he may, on the recommendation of

the Board, deem”.

Article 15 of the principal Act shall be amended as follows> Amendment of

article 15 of the

principal Act.

(a) sub-article (2) thereof shall be substituted by the

following>

“(2) For the purposes of subarticle 5 (2) and of

subarticle 10 (7), the use on any card, letter head, sign, board,

plate, advertisement or other written, printed or engraved

device, instrument or document, of the words “certified public

accountant” or its abbreviation “CPA”, whether in its singular

or plural form, in relation to a name, shall be sufficient

evidence of the knowledge of such use by the person in relation

to whose name the said words or abbreviations are used, unless

such person proves that the use was made without his

knowledge and that upon becoming aware of the use he took

adequate steps to stop it.”<

(b) paragraph (a) of subarticle (3) thereof shall be substituted

by the following>

“(a) a person shall not be deemed to exercise the

profession of accountant if he acts simply as an employee of,

or assistant to, a certified public accountant or a partnership

of accountants, and does not issue any accounting or financial

statement over his name<”<

(c) in paragraph (b) of subarticle (3) thereof, the words “or

to act as auditor” shall be deleted< and

(d) immediately following subarticle (3) thereof, the

following new subarticle (4) shall be inserted>

“(4) The conduct by the Board of proceedings for

professional misconduct and other disciplinary proceedings

in terms of article 7 of this Act shall be without prejudice to

any proceedings which may be taken against the person

concerned under the provisions of the Criminal Code or of

any other law and any proceedings so taken shall be without

prejudice to any procedings that may be taken by the Board.”.

Passed by the House of Representatives at Sitting No. 42 of the 14th October,

2003. A NTON T ABONE

Speaker

R ICHARD J. C AUCHI

Clerk to the House of Representatives

Mitbug[ fl-Istamperija tal-Gvern — Printed at the Government Printing Press