Speech by Mr Louis Ng Kok Kwang, MP for Nee Soon GRC, at the Second Reading of the Accountancy Functions (Consolidation) Bill (Bill No. 29/2022)
Accountancy is a key sub-sector of the Professional Services Industry Transformation Map that was launched in January 2018. In June 2018, the Accountancy Sector Roadmap was launched charting an ambitious plan for the accountancy sector over the next 5 to 10 years to develop Singapore into a global accountancy hub.
This Bill is an important step in this direction. It will streamline the regulation of accountancy in Singapore and put ACRA in a stronger position to shape the development of the accountancy sector.
I have four points to make.
Revocation or suspension of a chartered accountant’s registration
My first point is on the process for revoking or suspending a chartered accountant’s (CA) registration.
The new section 35F provides the procedures for revoking or suspending a CA’s registration which must be done in line with the designated entity’s rules.
Can Minister clarify whether designated entities will be required to provide in their rules a right for CAs to be heard before any revocation or suspension?
Section 35G allows ACRA to review steps taken by a designated entity for any contravention by a CA where the entity did not take any action against the CA, or having taken such action, suspends the member’s registration or imposes any lesser penalty.
Can Minister clarify whether ACRA has the power to conduct a review in two further situations? First, where the entity took action and ultimately decided not to make any order against the CA. Second, where the entity took action and decided to revoke the CA’s registration.
I ask this because section 35G(2)(b) on the situations where ACRA may conduct a review refers specifically to suspension but not revocation by an entity.
On conducting a review, sections 35G(3) and (4) give ACRA the power to revoke registration, extend suspension, or suspend registration. It appears that ACRA has the powers to impose heavier, but not lighter sanctions than those initially imposed by the designated entity.
Can Minister clarify if ACRA has the powers on a review to impose lighter sanctions, or overrule the designated entity’s decision and not impose any sanction?
Under section 35G(5) before revoking, suspending or extending the suspension of CA’s registration, ACRA must give the person written notice of its intention to do so and an opportunity to submit reasons against ACRA’s decision.
Can Minister share why the opportunity for the CA to submit reasons appears to come only after ACRA has come to an initial view on whether the CA’s registration should be revoked or suspended?
Will the CA be provided an opportunity to submit reasons before ACRA makes an initial determination at all?
Deletion of designated entity
My second point is on ACRA’s powers to delete designated entities.
Under section 35L, before deleting a designated entity, ACRA must give the entity written notice of its intention to do so and the opportunity to submit reasons.
Can Minister share why the opportunity to submit reasons comes only after ACRA has come to a view on whether the entity should be deleted?
Will ACRA inform the designated entity that its designation is currently under review and provide the entity a chance to respond even before it takes a position on the deletion?
Can Minister share what considerations ACRA will take into account in deciding whether a designated entity should be deleted? This will provide guidance to entities in providing reasons for why they should not be deleted.
Retaining Talent in Accountancy
My third point is on retaining talent in accountancy.
In January this year, the Singapore Accountancy Commission worked on and unveiled a new job transformation map (JTM) for the accounting industry intended to chart a path forward for the sector in a post-COVID-19 world and introduce support initiatives to upskill and redesign jobs in this field.
This is a welcome step forward for the industry which is currently being transformed extensively by digitalisation and technology, and even newer drivers such as climate change. It will help safeguard jobs and create new ones.
However, while the JTM will address concerns on the supply-side, more work can be done on the demand-side. In June this year, the Straits Times reported that the sector was experiencing an acute labour shortage, with big four accounting companies raising salaries to retain talent.
With ACRA’s broadened scope to develop the accountancy sector and oversee qualifications and programmes relating to the sector with the dissolution of the SAC, what measures will be explored as part of the JTM or otherwise to attract and retain accountancy talent?
Roles and Responsibilities of the Accounting Standards Committee
My final point is on climate and sustainability-related accounting standards.
Part 3 of the Bill introduces a new Accounting Standards Committee which will take over functions from the Accounting Standards Council (ASC). The ASC is responsible for making and prescribing accounting standards for use by various entities.
ASC takes reference from the International Financial Reporting Standards (IFRS) issued by the International Accounting Standards Board (IASB) while taking into account local business and economic needs and circumstances.
The IASB is currently working on a set of global climate and sustainability-related disclosures designed to meet the information needs of investors in assessing enterprise value. Has the Council or will the Committee evaluate its stance on these new green standards?
Sir, notwithstanding my clarifications, I stand in support of the Bill.
Watch the speech here.