Oman suspends KPMG from beginning audits for a year

KPMG has been suspended from auditing entities regulated by Oman’s Capital Market Authority for a year following the discovery of what were described as ‘major financial and accounting irregularities’

The regulator said the suspension is the result of the Capital Market Authority’s inspection of some listed entities where its team identified the need to enforce immediate corrective measures to protect investors and other stakeholders.

The Capital Market Authority said it undertook a comprehensive review of the causes that included understanding the reason of the non-discovery and non-reporting of such irregularities by the auditors. This review stablished professional negligence on the part of some audit firms that warranted disciplinary measures.

This decision does not affect the engagements where the firm has already been appointed. In such cases, KPMG can continue in the capacity of auditor and discharge its contractual obligations. The legal and regulatory provisions in Oman grant KPMG a legal right to appeal against this decision before independent appellate authority.

The Capital Market Authority says it is also further strengthening its regulations in line with its learning gained from recent cases to avoid their recurrence, although it pointed out that most of the accredited audit firms it has assessed have demonstrated adherence to ISAs and ensured that financial reporting is strictly in compliance with the requirements of IFRS that are mandatory in the sultanate.

It says it expects the audit firms against whom the recent disciplinary measures have been taken to carry out comprehensive internal reviews to identify causes and make required course corrections. The Capital Market Authority also advises such firms to implement robust internal quality control procedures to avoid such occurrences in future.

In a press statement released locally KPMG said it was ‘cooperating with the Capital Market Authority during the review of certain audits dated prior to 2015 and the firm is fully committed to cooperating with the Capital Market Authority to resolve these matters.

‘Audit quality and compliance with professional standards is the highest priority in KPMG. The firm strongly believes that continuously improving audit quality is fundamental to meeting its responsibilities and maintaining public trust.’

Report by Pat Sweet

0
Be the first to vote
Subscribe