Unregistered Accountants Face Big Fines And Jail Terms

Are you a practicing accountant?
Then you need to be registered to avoid paying huge fines and going to jail.
With the signing into law of the Finance Act 2018; amendments to the Accountants Act Number 15 of 2008 stating that accountants without the required professional registration now face hefty fines and jail terms came into effect.
According to Edwin Makori, the ICPAK chief executive, there has been a rampant abuse of the designation by thousands of practitioners despite the fact that Kenya has only 22,000 duly qualified and registered accountants.
“There are only 22,000 persons recognized in law as professionals in accountancy. The rest performing roles of accountancy should not be referred to as accountants,” Mr. Makori, said adding that the Finance Act 2018 had amended the definition of an “accountant” – making clear who can use the designation.
“The law now provides that an “accountant” is a person registered under Section 24 of the Accountants Act, in line with expertise achieved through formal education and practical experience,” Mr. Makori said.
According to this definition, anyone in the accounting profession who is not registered with the Institute of Certified Public Accountants of Kenya (ICPAK), will not be considered a legitimate accountant and could face fines or jail time.
In a press statement earlier this week, ICPAK promised to be firm in the fight against rogue accounting practitioners, including those using the “Certified Public Accountant (CPA)” designation illegally.
That’s not all; students intending to pursue accountancy examinations by the Kenya Accountants and Secretary National Examinations Board (Kasneb) are required to register with ICPAK.
“The examination board shall, prior to registering a person to undertake an examination in accounting, require that the person be registered as a member of the institute,” the new clause states.
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The penalties
According to the amendment; abuse or wrongful use of the designation ‘accountant’, will attract a fine not exceeding Sh2 million, and, in the case of a continuing offense, a further fine not exceeding Sh2,000 for each day that the offense continues.
Fake Accountants
Mr. Makori warned employers and the general public against hiring quacks or allowing those who are not qualified to use designations in the accountancy profession without the proper certification.
This is after various public companies such as were able to conceal their financial status due to bad accounting practices.
A good example is how Imperial Bank, Mumias Sugar, Kenya Airways and Uchumi Supermarkets have gone into financial trouble without their auditors raising the alarm.
What does this mean for you as an accountant?
The Institute of Certified Public Accountants of Kenya (ICPAK) says the law, is intended to rid the industry of quacks who have given the profession a bad name.
With the amendment coming into effect, as an accounting professional you need to ensure you are registered with ICPAK in order to avoid the fines or going to jail.
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Not only that but it is expected that employers will now also focus on hiring accountants who are registered with ICPAK. You will have a better chance of getting the job as opposed to someone who is not registered with the organization.
In Conclusion,
Therefore, as an accounting professional you need to ensure that you are registered with the Institute of Certified Public Accountants of Kenya (ICPAK) in order to avoid paying huge fines as well as jail time.
Source: Business Daily