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"id": 196732,
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"speaker_name": "Mr. Kimunya",
"speaker_title": "The Minister for Finance",
"speaker": {
"id": 174,
"legal_name": "Amos Muhinga Kimunya",
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"content": " Thank you, Mr. Deputy Speaker, Sir. I actually thanked the House for having given the leave. Mr. Deputy Speaker, Sir, Clause 26 is very relevant and I would like to highlight it. It sets out qualifications for the registration. Again, they remain broadly the same as those that are obtaining in the current Act. However, it removes eligibility to be appointed an auditor at the commencement of the Act as a basis for registration. We want to have a situation where even people who do not intend at all to become auditors can still seek to be registered as accountants. It has moved in terms of the range of services that accountants provide and not all of them will end up being auditors. Again, this was a transitional provision under the current Act where some people had to be allowed in because auditors were required and they were in short supply. Any one who wanted to just become an auditor, was allowed to be actually registered. However, this has now been overtaken by events with our 6,000 accountants having been now produced within our country. Mr. Deputy Speaker, Sir, Clause 27 is broadly the same within the current Act. Again, it is doing some reorganisation, so that there is proper sequencing of the Act. People can follow through exactly how do I register, how do I become a lawyer, what do I do, how do I get regulated. It is a very easy thing, not just to read, but to practice. Mr. Deputy Speaker, Sir, as I said, the Registration Board is being replaced by the Registration Committee. Clause 29 provides for the circumstances under which the Registration Committee may cancel member's registration. It also provide for appeals against the decision of that committee to an arbitrator, and thereafter, to the High Court. Again, this is provided for to avoid the Registration Committee from taking decisions on its own to the disadvantage of a member. However, at least, one has recourse. If he is not registered, he can go, first of all, to arbitration, and thereafter, to the High Court which, again, gives every one the right to be heard. Mr. Deputy Speaker, Sir, now of particular interest to us is Clause 30, which is basically defining the conduct. It define the conduct which is deemed to be professional misconduct by accountants who have been registered. We do not want to leave it to doubt or broad interpretation as to when an auditor or when an accountant is deemed to have conducted himself in a way that will be deemed to professional misconduct. Following immediately after that is then the establishment of the Disciplinary Committee within Clause 31. This is a committee of the Council. However, by putting it now within the law, it is being uplifted from just being another administrative committee of the Council or the Institute to make it a legally recognised committee that would now have the powers to actually take action on people who go wayward. It is proposed that this committee will also include members who are not accountants, so that people who are nominated by the Council from a professional other than accountancy and an organisation that promotes corporate governance--- I think the import of this is to ensure that when we are now looking at the Disciplinary Committee, we have the users of the accounting services, bodies that are promoting good governance and what accountants should be observing and also by looking at any other profession to bring in and practice this from the other end. That committee will be able to give justice, not just to the person who has been brought before it, but also to the wider society. Mr. Deputy Speaker, Sir, Clauses 32, 33 and 34 provide for inquiries that will be held by the Disciplinary Committee. The next clause basically clarifies the disciplinary provisions that shall apply to the holder of an authority to practice. Mr. Deputy Speaker, Sir, Part V of the Bill, again, contains some miscellaneous provisions. The only one to highlight here is that Clause 37 which provides for employment of staff by the Institute and the Examination Board. It is now recognised within the law that they actually have the April 15, 2008 PARLIAMENTARY DEBATES 447 power to contract and hire staff. These are some of the things that were, perhaps, not envisaged when they were almost volunteer organisations then. It provides also for the protection of the Institute and Examinations Board from liability for what it has done in good faith and without negligence in exercise. Again, this is a standard provision in all the setting up of the other institutes. Mr. Deputy Speaker, Sir, Clause 39 provides for the funds of the Institute and the Examinations Board which are similar to those obtaining under the current Act. More importantly is that the accounts of the Institute and the Examination Board must they themselves be subjected to audit which, perhaps, had been assumed that auditors do not require an audit, but we now know that everyone requires that. We know that the quality and integrity of the accountants is only as good as the examination process they go through. Clause 42 is now providing for examination offences and prescribing penalties for those offences. If there is something that happens within the examination of accountants, that anyone committing those happenings knows those examinations are protected by law, they are required by law to ensure that the end product is not as good as the process and can be acted upon by the public to give advice. Mr. Deputy Speaker, Sir, the management of the Institute will be in the hands of the Council. This law now provides for validity of meetings of those councils. Currently, there is no provision for what happens if one of the Council members falls sick or does not attend a meeting. To ensure that we are in tandem with current corporate governance practices, then, this is now opening up and saying that the decisions of our Council would not be invalidated provided that there is quorum, but by the absence of a vacancy in the membership. In a situation where we have a practising member who is registered as an accountant and gets indisposed or incapacitated in any way and has a practice that he is running, we do not put members of the public in trouble by saying \"wait for your auditor to come\". We can provide for the Institute to actually appoint an interim manager to run the professional affairs of the firm, while waiting for the member to come out of the incapacitation. Clause 46 provides for making of the regulations by the Minister to capture some of the things that, perhaps, are day to day details that do not need to be included within the Act. Some of that will come within this debate and on ongoing basis. Again, that is a standard provision in all the laws. I am aware that The Companies Act is being reviewed independently. But pending that review, and to make it in tandem, we would be proposing that Section 161 of the Companies Act, Cap.486, be amended to require that to be appointed an auditor of a company, a person should be a holder of a practising certificate issued under the proposed Act so that we do not have accountants who practice under different legislations when this House would have seen it fit to pass the new law that would be regulating what accountants should do. So, we want to harmonise these legislations. Once we pass this Bill, which I am sure the Members will support, we would bring in the Companies Act and the Building Societies Act, as well as, the Labour Relations Act, to be in harmony with this new Act. Instead of looking at the patch works in terms of cut and paste, we have taken the view that the changes contained herein are so fundamental. It would be good to actually bring to the Members the entire Act as it would be. Once this is then passed, the current Act as it is in its entirety would be repealed. That is a provision under Clause 50. Mr. Deputy Speaker, Sir, the Schedules are very self explanatory. They provide for provisions of the Institute, on the appointments and elections of the members of the council so that it is not left to doubt, how this will happen in terms of what would happen to procedure and the registration of committee. It also talks about the membership of the Examination Board, the procedure for an inquiry and disciplinary action so that there is a legal due process in terms of who, 448 PARLIAMENTARY DEBATES April 15, 2008 at what point you get taken; what is the recourse and what steps do you go through. Basically, the rest are the transitional provisions that we are making so that at the passage of this Bill, the current Council of the Institute transits to the next Council of that Institute. Mr. Deputy Speaker, Sir, this is a straightforward Bill. It is something that has taken close to ten years in terms of trying to get it within all the various stakeholders and negotiations within the industry. But I am very happy that after ten years of those attempts, it is now on the Floor of the House. It will also enjoy the privilege of being the first Bill that this House would be looking at. This is because an economy that is growing requires to have an environment where shareholders' funds are protected and figures cannot be forged like we saw in the case of the Enron Company where people bought shares because it was growing but it was actually figures that were being stage-managed. For us, as we recoup our positions as one of the fastest growing economies in this region, it is important that we have the legislative environment for our accountants to give them the operating framework so that they can look into the accounts of our companies and give comfort to our shareholders so that things are well. I believe that this House would rise to the occasion and look at all the things that need to be done. We can then debate it and bring it here by the time we go to the Third Reading in order to give the accounting profession a clean start after 30 years of existence with the current law. I believe I have covered most of the aspects. I wish to inform the Members that there is nothing hidden within this Bill. It is all there for them to read. There are no hidden motives. We do not want to discuss it with speed. We want to discuss it fully. I am prepared to wait until we form a Committee that will read through and discuss this Bill so that we pass a law, that come another ten years time, we shall be proud of passing a law that has passed the test of time. With those few remarks, I beg to move and request hon. Mudavadi to second."
}