The Hong Kong Institute of Certified Public Accountants plans to complete next year about 10 investigations of alleged auditing failures but will pass on all new dossiers to the newly formed Financial Reporting Council, according to institute president Mark Fong Chung. Mr Fong was elected to a 12-month term as head of the institute on Friday. His most important task will be to oversee the transfer of its investigative powers to the FRC, which came into being on December 1. The government set up the FRC to take over investigations of audit deficiencies at listed companies in answer to complaints that the institute has been slow to act in the past because of lack of legal powers and staff. The law which set up the FRC gives it greater investigative powers than the institute enjoyed and its own full-time staff. 'We have about 10 continuing investigations which will be handled by the institute. I hope to clean them up during my term. We have already outsourced some investigative work to speed up the process,' Mr Fong said in an interview. The new president of the institute is a senior partner of Moores Rowland Mazars. The firm was the auditor of Ocean Grand Holdings, which was forced into provisional liquidation earlier this year after 800 million yuan went missing. The provisional liquidator's report last month cited instances of alleged false accounting in the group's mainland operations. Seven people have been arrested. Mr Fong said it would be up to the new watchdog to decide if there was any need to examine Moores Rowland Mazars' performance as Ocean Grand's auditor. 'In case there is any investigation of Ocean Grand and Moores it would be handled by the FRC. To prevent any conflict of interest I would not be involved,' he said. Mr Fong's other main preoccupation in the year ahead will be leading the institute to work more closely with China which will adopt international accounting standards on January 1. 'For the longer term, we wish to unify the accountancy qualification examinations in Hong Kong and China. We also want to make it easier for accounting professionals to work across the border. But as this is a long-term project I will only be responsible for sowing the seed,' he said. The institute next year will introduce a new practice review programme to ensure the quality of accounting work. Under the new scheme the 50 'public interest' firms that audit the books of listed companies and insurers will be reviewed first and on a regular basis. Until now they have been subject only to random checks. Firms will have to be able to show that they have enough staff to properly handle their clients' business and that they have appropriate systems in place. The institute will continue to lobby the Hong Kong government to introduce changes to the law to protect the interests of accounting firms. These would include caps on a firm's liability in the event of a lawsuit. Mr Fong also wants the government to introduce the concept of limited liability partnership to ensure that an accountant's personal assets could not be seized as a result of legal action stemming from a partner's mistake. 'Many overseas countries have adopted limited liability partnership but Hong Kong law has yet to introduce the concept. Hong Kong is very much lagging behind in this area and it should catch up,' he said.