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"id": 196733,
"url": "https://info.mzalendo.com/api/v0.1/hansard/entries/196733/?format=api",
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"type": "speech",
"speaker_name": "Mr. Mudavadi",
"speaker_title": "The Deputy Prime Minister and Minister for Local Government",
"speaker": {
"id": 84,
"legal_name": "Wycliffe Musalia Mudavadi",
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"content": " Mr. Deputy Speaker, Sir, I beg to second the Bill. I would focus may be just on two issues because the provisions of this Bill would have to be scrutinised quite effectively. I am happy that the Minister has, indeed, stated that before the Bill is brought back for the Third Reading, the relevant Committee, which would have been constituted, would have an opportunity to thoroughly examine the provisions of this Bill. First, let me just say that this Bill is extremely timely because we know very well that matters that relate to finance are extremely sensitive. They can also be extremely distractive. There are occasions when some accountants have completely let down the profession and, indeed cast a lot of doubt on the integrity of the profession of the accountants. There are many cases in this country, where annually, auditors, who by profession are actually accountants, would make provisions and actually give financial institutions a clean bill of health only for the same financial institutions to collapse a few weeks or months later. That would mean that somewhere along the line, the professionals were not doing their job properly or were part of the broader scheme to ensure that the details and the full disclosure of a particular institution is not made public, yet it is holding public funds and peoples' deposits. So, clearly this Bill calls for a lot of attention from the Members of the House so that we can seal those loopholes where the professionals can be used to be part of a process that can hurt and injure many Kenyans. Mr. Deputy Speaker, Sir, many financial institutions have gone under. Several banks that were licensed in this country have collapsed with millions of deposits of innocent Kenyans, who would, perhaps, rely on the financial statements that were produced annually that showed a clean bill of health of some of these institutions. Examples of these banks are so numerous that one does not really have to enumerate them. Mr. Deputy Speaker, Sir, I believe it would be important for the Members to look at some April 15, 2008 PARLIAMENTARY DEBATES 449 of the provisions that are being provided for here. Mr. Deputy Speaker, Sir, when they talk of the Membership of the Council, one of the things that seems to be coming up nowadays is a situation where there is too much an element of one public entity being part of another. To a certain extent, we are creating institutions whose composition is, perhaps, becoming too \"incestuous\". This leads to a situation where the independence and professionalism is undermined, because somebody may be sitting, or doubling up, in several institutions. He may be doubling up because it is one institution. Like here, we have the Capital Markets Authority (CMA) and others, which are all going to constitute councils of the same members. Mr. Deputy Speaker, Sir, I raise this because these are becoming very weighty issues. Not too long ago, for instance, there was debate on the aspects of the flotation of Safaricom shares that is going on. There were a lot of questions being raised about some aspects of the prospectus of the Safaricom share issue. This is a prospectus that has, indeed, been pieced together by professionals. The majority of them, I am sure, are accountants and financial experts. This needs to be looked into. Mr. Deputy Speaker, Sir, while seconding this Bill, let me point out one other issue. On page 44 of this Bill are Disciplinary Provisions. There is (j), which talks of an accountant requiring disciplinary action if he expresses his opinion of financial statements of any business or any enterprise in which he, or his immediate family, his firm or any other partner in his firm has an interest, unless he discloses that interest when expressing the opinion. Mr. Deputy Speaker, Sir, if you look at that provision and then look at the definition of what immediate family is, it becomes a mouthful. Immediate family here includes a spouse, child, grandchild, parents, grandparents, brother, sister, uncle, aunt, first cousin or adopted child, or a child of his or her brother, or a sister of his or her adopted child and such relations of the half- blood, or a child of such relations of the half-blood as well as of the whole-blood. This is a mouthful! I think we want to make laws that really help the country. We should be very careful when defining what immediate family is. This is extremely broad. Most hon. Members may not have captured this particular aspect, because they just received the Bill today. Mr. Deputy Speaker, Sir, however, when you look at it, you can see that I would have needed a glass of water when just trying to go through those provisions. I think these are areas that can be looked at, so that we can have a more meaningful way of defining what or who is an immediate family, as opposed to going to an extent where it can become unnecessarily prohibitive even to the profession itself and institutions. At the end of the day, defining some of these things can be extremely difficult in the current circumstances. Mr. Deputy Speaker, Sir, by and large, I believe it is important that the profession of accountancy is given better definition. It also needs to be supported by an Act of Parliament that is more in tandem with the changes that have taken place since the earlier law came into force. It is important that the issue of KASNEB and ICPAK are re-looked at. Mr. Deputy Speaker, Sir, I would also like to urge that hon. Members look at this particular Bill. They should bear in mind that it is important that we should create laws that can support indigenous professionals. We must make sure that within the provisions of this Bill we are very careful and look at a way of ensuring that we can built capacity in our people. We do not want to have a situation where, perhaps, a foreign bank comes to Kenya, invests, starts up but when it comes to hiring professionals who can do some of the accountancy jobs, they tell you: We will come with our accountants from another country to take care of the aspects of auditing and looking at the books of our institution. As we professionalise, we must bear in mind that we built capacity. We must give indigenous Kenyans an opportunity to participate in some of these fields, so that we do not create laws or institutions that at the end of the day will cease to serve the Kenyan people, 450 PARLIAMENTARY DEBATES April 15, 2008 but will continue to serve the interests of professionals from other countries. We want to create employment and build capacity. I think these are some of the very important issues that I would request that when the relevant committee deals with this Bill, they go through it with a tooth comb, so that by the time it gets to the Third Reading we can be proud and say we have a very good law for Kenyans; a law that will safeguard and not constrict, or strangle, professionals in this country. With those few remarks, I beg to second."
}