Financial Reporting Council (FRC) needs to play more effective role for improvement of quality of audit and corporate financial reporting systems significantly which will consequently help address the willful default loan problem in the banking sector.
Dhaka Chamber of Commerce and Industry (DCCI) President Shams Mahmud made the remarks at a virtual seminar on “Financial Reporting Act-2015: its implications on the business houses” organised by DCCI on Saturday.Comptroller and Auditor General of Bangladesh Mohammad Muslim Chowdhury joined the webinar as the chief guest while Aftab-Ul Islam, Director, Bangladesh Bank joined as guest of honour.
Speaking at the programme, DCCI President said that transparent financial reporting by all listed companies as a well as non-listed company is very critical to gain investors' confidence thereby attract investment in the capital market.
To attract foreign investment, MSME reporting also needs to meet international requirements and standards such as those set by the International Accounting Standards Board, he said.
“Simple, user-friendly accounting and financial reporting guidelines for MSMEs need to be in place to ensure better access to finance,” added DCCI president. Mohammad Muslim Chowdhury FRC needs to improve the visibility and for that it can collaborate with Bangladesh Bank, BSEC, Ministry of Finance or other regulatory body.
“In the next 4 to 5 years FRC should play a role of persuasion rather than imposition,” he suggested. For improvement of corporate governance in the small business houses or SMEs, FRC can play its motivating role, said Muslim Chowdhury.
Mentioning the wave of 4th industrial revolution, Comptroller and Auditor General requested the institutions like ICAB and ICMAB to collaborate with FRC to enhance management information system and corporate governance in next 10 years of time. Bangladesh Bank Director Aftab Ul Islam said better financial reporting will help attract FDI and create business confidence.“We have to enhance our credibility and in that case we can examine the successful examples of other countries in terms of financial reporting regulations,” he added.
Among others, Executive Director, Standard Setting Division of Financial Reporting Council (FRA), Associate Professor of University of Manchester Javed Siddiqui, The Institute of Chartered Accountants of Bangladesh (ICAB) President Muhammad Farooq, The Institute of Cost and Management Accountants of Bangladesh (ICMAB) President Jasim Uddin Akond also joined the webinar.