Accountancy Profession (Amendment) Regulations, 2004

L.N. 226 of 2004

ACCOUNTANCY PROFESSION ACT

(CAP. 281)

Accountancy Profession (Amendment) Regulations, 2004

IN exercise of the powers conferred by article 8 of the

Accountancy Profession Act, the Prime Minister and Minister of

Finance has made the following regulations>-

(1) The title of these regulations is the Accountancy Citation and

Profession (Amendment) Regulations, 2004 and they shall be read commencement.

and construed as one with the Accountancy Profession Regulations, L.N. 29 of 1987.

1987, hereinafter referred to as “the principal regulations”.

(2)

These regulations shall come into force on the 29th

April, 2004.

Regulation 2 of the principal regulations shall be amended Amends regulation

2 of the principal

as follows>-

regulations.

(a) for the words “ “Act” means” there shall be substituted

the words “ “the Act” means”< and

(b) in the definition “warrant holder”, for the words “or

a warrant to act as auditor” there shall be substituted the words

“or is a partnership registered under article 10 of the Act”.

Regulation 3 of the principal regulations shall be amended Amends regulation

3 of the principal

as follows>-

regulations.

(a) in sub-regulation (2) thereof, paragraphs (e), (f) and

(g) shall be deleted< and

(b) in sub-regulation (3) thereof, for the words “five

hundred liri” there shall be substituted the words “two thousand

and five hundred liri”.

For regulations 4, 5 and 6 of the principal regulations there

shall be substituted the following>-

4. (1) The audit of any accounts of companies,

other entities or bodies of persons may only be carried on

by a warrant holder holding a practicing certificate to act

as auditor issued by the Minister on the recommendation

of the Board to a person who –

(a)

is a certified public accountant<

(b)

satisfies the Board that –

(i)

he has adequate qualifications in auditing<

and

(ii) he has gained three years full time

experience in auditing at appropriate level, under the

supervision of a holder of a practising certificate to

act as auditor who shall have satisfied the Board in

respect of his competence, skills and work experience

for the purpose of such supervision, or such full time

experience in auditing at an appropriate level in any

country outside Malta under the supervision of such

person or persons whom the Board considers as

adequate for the purpose, or a combination of such

full time experience in Malta and outside Malta>

Provided that at least two years of this experience were

gained after obtaining the degree or academic qualification

relating to the accountancy profession prescribed in

paragraph (c) of subarticle (2) of article 3 of the Act>

Provided further that any experience gained before

the qualification above referred to shall be considered to

amount to only one half of the time so spent and shall in

no case be deemed to exceed one year>

Provided further that the supervision required under

this regulation shall be carried out by persons providing

such adequate guarantees regarding training as may be

prescribed.

(2) An authorization to act as auditor issued prior

to the 25th July, 1978, under the provisions of article 141

of the Commercial Partnerships Ordinance as in force at

the time of the issue of the authorization, in favour of a

person who was then a member of a body of accountants

recognized for the purposes of that article, or the holding

of a warrant to act as auditor issued under the provisions

of article 5 of the Act, prior to the date of entry into force

of this regulation, shall for all purposes have the same effect

of a practicing certificate issued under this regulation and

be deemed to have been so issued.

(3) The holder of a practicing certificate issued

under this regulation may bring this fact to the notice of

the public, so however that holders of the warrant of

certified public accountant and auditor immediately before

the date with effect from which such person shall be

deemed to have been issued with a practicing certificate

under the immediately preceding sub-regulation, shall

cease to use the designation “certified public accountant

and auditor” and the corresponding abbreviation “CPAA”.

(4) A partnership registered under article 10 of the

Act shall be entitled to apply for a practicing certificate to

act as auditor in terms of this regulation, and where such a

practicing certificate is issued to a particular partnership,

the carrying out by such partnership of statutory audits of

annual accounts (including audits of the consolidated

accounts of bodies of undertakings) shall be carried out

by, or under the supervision of, at least one partner holding

a practicing certificate issued in terms of this regulation>

Provided that the provisions of sub-article (2) of this article

shall apply mutatis mutandis in respect of partnerships

registered under article 10 of the Act prior to the date of

entry into force of these regulations.

(5) References in any law or regulation to the term

“auditor” or to any person holding a warrant to act as

auditor issued under the Accountancy Profession Act or to

any partnership of auditors duly registered under that Act

or other words to that effect, shall be construed as

references to a person holding a warrant as a certified public

accountant who also holds a practicing certificate to act as

auditor in terms of this regulation or to a partnership

registered under article 10 of the Act which holds a

practicing certificate to act as auditor in terms of this

regulation, as the case may be.

(6) Agreements or other arrangements purporting to

exempt persons required to hold a practicing certificate

issued under this regulation from any liability,

responsibility or duty relative to the audit of any accounts

of companies, other entities or bodies of persons, as laid

down under the Act, under any regulations issued

thereunder, or under any other enactment, or to relieve him

therefrom, or, except under a policy of insurance made out

under article 11 of the Act, to indemnify him against any

such liability or responsibility, shall be null and void.

(7) The provisions of sub-articles (5) and (6) of

article 3, of sub-article (2) of article 5, of sub-article (6) of

article 10 and of sub-article (2) of article 15 of the Act and

any penalties contemplated therein shall apply mutatis

mutandis also in respect of the holding of a practicing

certificate issued under this regulation.

(8) (a) For the purposes of sub-paragraph (ii) of

paragraph (b) of sub-regulation (1) of this regulation,

supervision of experience in auditing shall be carried out

by persons holding a practicing certificate to act as auditor

who shall have satisfied the Board that they possess the

necessary competence, skills and work experience to ensure

that appropriate training is given to prospective holders of

a practicing certificate in auditing, working under their

supervision.

(b) In order to be eligible for acceptance by the

Board, such persons must apply to the Board giving details

on qualifications and experience held by them. Upon

acceptance, the Board will confirm its approval in writing.

(c) In the case of a partnership holding a

practicing certificate to act as auditor, an application in

terms of this sub-regulation must be made in respect of

each of the persons on whom the partnership will rely to

supervise the audit work of persons seeking to apply for a

practicing certificate in auditing.

(d) In approving applications for the

supervision of audit work experience, the Board may

impose such conditions and give such directions as it deems

appropriate from time to time.

(1) The provisions of article 153 of the

Companies Act shall mutatis mutandis apply also in respect

of appointment as auditor or holding the office of auditor

of any entity or body of persons other than a company, so

however that references to “officer” or “officer of the

company” in the aforementioned article of the Companies

Act should be construed as referring to “a person by

whatever name called, performing or having the power to

perform substantially the same functions in relation to the

direction of the affairs of the particular entity or body of

persons as those carried out by an officer within a

company”.

(2) Any person who acts in contravention of article

153 of the Companies Act or this regulation shall be guilty

of an offence and shall, on conviction, be liable to a fine

(multa) of not more than five thousand liri.

(1) The Accountancy Board may, with the

approval of the Minister, issue directives regulating the

activity of warrant holders or guidelines for warrant holders

concerning>

(a) professional ethics and independence of

warrant holders<

(b) the confidentiality of information obtained

by a warrant holder or his employees in connection

with work performed or services rendered in

connection with the accountancy profession<

(c) advertising and publicity by warrant

holders<

(d)

obtaining professional work<

(e)

the criteria concerning the charging of fees<

(f) clients’ accounts and monies held on behalf

of clients and third parties<

(g) continued professional education<

(h) quality assurance<

(i) definition of the terms “audit” and “auditing”<

(j) norms for the approval of persons supervising

work experience required for the issue of warrants

under sub-article (1) of article 4 of the Act and

practicing certificates issued in terms of regulations

prescribed in terms of sub-article (2) of article 4 of

the Act<

(k)

the professional conduct of warrant holders<

(l) on the meaning and interpretation of any

regulations issued in terms of article 8 of the Act<

(m) the punishments, penalties and other

consequences and effect to which a person may

become liable or which may take place in the event

of any contravention of, or non-compliance with the

provisions of any directive, so however that these may

not exceed such parameters as may be set out in the

Act and

(n) such other matters as may be prescribed by

regulation.

(2) Directives and guidelines issued in terms of

subregulation (1) shall be published -

(a)

in the Gazette< or

(b) by the Ministry of Finance in a separate

publication and the fact of publication thereof shall

be notified in the Gazette together with information

as to where the said publication may be viewed or

copies thereof obtained by the public.

(3) Directives and guidelines issued in terms of this

regulation shall not become operative before the lapse of

one week from the publication in the Gazette made in terms

of subregulation (2)(a) or (b), or such later date as may be

specified therein.”.

5. In regulation 8 of the principal regulations for the words

“The Accountancy Board shall” there shall be substituted the words

“Any Disciplinary Committee appointed by the Accountancy Board

in terms of sub-article (4) of article 7 of the Act shall”.

6. The Schedule to the principal regulations shall be amended

(a) in rule 2, for the definition “appropriate warrant” there

shall be substituted the following>

“ “appropriate warrant” means the warrant held by

an individual to practice the profession of accountant issued

in terms of sub-article (1) of article 4 of the Act, or the

registration of any partnership in terms of article 10 of the

Act, and includes also, where appropriate, the holding by

such individual or partnership of any certificate to practice

in such fields of the profession of accountant as may be

prescribed in terms of sub-article (2) of article 4 of the

Act<”<

(b)

rule 5 shall be amended as follows>

(i) in paragraph (b) of sub-rule (1), for the words

“be held.” there shall be substituted the words>

“be held< and

(c) state the names of the individuals nominated by the

Board to perform duties as members of the Disciplinary

Committee in respect of the particular charge or charges,

including the individual nominated by the Board as Chairman.”<

and

(ii) in sub-rule (3), the words “place of residence.”

shall be substituted by the words “place of residence in

the case of an individual, and in the case of a partnership

registered in terms of article 10 of the Act, at the address

from which it conducts its activities according to the

records of the Board.”<

(c) in rule 8 wherever the words “the Board” appears

there shall be substituted the words “the Disciplinary

Committee”<

(d) in rule 9 wherever the words “the Board” appear

there shall be substituted the words “the Disciplinary

Committee”<

(e)

rule 10 shall be amended as follows>

(i) in sub-rule (1) for the words “the Board”

there shall be substituted the words “the Disciplinary

Committee”< and

(ii) in sub-rule (2) for the words “The

Chairman” there shall be substituted the words “The

Chairman of the Disciplinary Committee”<

(f) in rule 11 for the words “the Chairman” there

shall be substituted the words “the Chairman of the

Disciplinary Committee”<

(g) in rule 12 for the words “the Board” wherever

they appear there shall be substituted the words “the

Disciplinary Committee”<

(h)

in rule 13 –

(i) for the words “the Board” wherever they

appear there shall be substituted the words “the

Disciplinary Committee”< and

(ii) in sub-rule (d) immediately after the words

“give its decision” there shall be inserted the words

“including the imposition of any penalty as it may

determine”<

(i) in rule 14 for the words “the Board” wherever

they appear there shall be substituted the words “the

Disciplinary Committee”<

(j) for rule 15 there shall be substituted the

following>

“15. (1) The decisions of the Disciplinary

Committee shall be given in public and in writing<

they shall be signed by the Chairman of the

Disciplinary Committee.

(2) The original shall be forwarded by the Secretary

to the Board together with the complete record of the

inquiry. The Board shall make its recommendation in

writing to the Minister to give effect to the decisions of

the Disciplinary Committee. A copy of any decision of

the Disciplinary Committee, certified as a true copy by

the Chairman of the Board, shall be forwarded by the

Secretary to the Minister, together with the

recommendation of the Board.

(3) On receipt of the decision of the Disciplinary

Committee and of the recommendation of the Board, the

Minister shall give effect to the decision and act in terms

of article 14 of the Act.”<

(k) in rule 16 for the words “the Board” wherever

they appear there shall be substituted the words “the

Disciplinary Committee”<

(l) in rule 17 for the words “the Board” there shall

be substituted the words “the Disciplinary Committee”<

(m) in rule 18 for the words “the Board” there shall

be substituted the words “the Disciplinary Committee”<

(n) in rule 20 for the words “the Board” there shall

be substituted the words “the Disciplinary Committee”<

(o) for rule 21 there shall be substituted the

following>

“21. The members of any Disciplinary

Committee, the Board and the Secretary shall not

divulge anything discussed by the Disciplinary

Committee or the Board in the course of an inquiry.”<

and

(p) in rule 22 for the words “the Board” wherever

they appear there shall be substituted the words “the

Disciplinary Committee”.

The Appendix to the Schedule shall be amended as follows> Amends the

Appendix to the

Schedule.

(a)

in Form A –

(i) the following new paragraph shall be inserted

immediately between the second paragraph and the third

paragraph commencing with the words “A copy of the

Rules”>

“The Accountancy Board has nominated the

following individuals as members of the Disciplinary

Committee that will conduct the inquiry in respect of

the above charge#charges>

………………

………………

………………

………………

The Disciplinary Committee shall be chaired by the

above-mentioned ……………… ”< and

(ii) in the last paragraph for the words “the

Accountancy Board” there shall be substituted the words

“the Disciplinary Committee”< and

(b) in Form B, in the paragraph commencing with the

words “You are hereby required”, for the words “the

Accountancy Board” there shall be substituted the words “the

Disciplinary Committee nominated by the Accountancy Board”.

The Accountancy Board (Examination Fees) Regulations,

1982. 1982, are hereby deleted.

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