HKSA to submit company proposal
THE Hong Kong Society of Accountants (HKSA) will submit a proposal soon on the incorporation of accounting firms to the Financial Services Branch, HKSA president Nicholas Etches says.
He expected accounting firms would operate as partnerships and corporates during the transitional period needed to transfer operations while incorporation took place.
Mr Etches said accountants could choose not to incorporate their business or to shift some operations to an incorporated vehicle.
'I think practitioners would tend to incorporate operations with higher risks . . . [business related to] public listed clients would be one of those,' he said.
This was because insurance was required, as stated in a bill passed in July this year, for all incorporated accounting firms.
Mr Etches said individual practitioners or small partnerships could benefit from incorporating their businesses because they could share operation costs.
Society executive director Louis Wong said the major headache was how to handle the names of incorporated accounting firms as they usually used the names of accountants.
Mr Wong said the society handled the names of 2,000 partnerships, but registering them as companies could cause name duplication because of the thousands and thousands of companies already registered.
About 400 practitioners have been reviewed by the society since 1992.
The society intended to carry out a further survey on practitioners being reviewed because some accountants were concerned by the practice.
Mr Wong said two cases were referred to the Disciplinary Committee after the second review this year.
Mr Wong said it would take six years to finish the first round of reviews.
Mr Etches said it was expected that the second round, on the financial statements of H shares would be published by mid-January next year.