Capital Markets

CFOs of listed firms summoned over rising cases of accounting fraud

Financial markets regulators have summoned the chief financial officers of listed firms as mounting cases of accounting fraud test the effectiveness of market watchdogs.

The Capital Markets Authority (CMA) and the Institute of Certified Public Accountants will Tuesday discuss issues relating to the accountancy profession, the auditors’ and ICPAK’s role in protecting public interest in relation to recent allegations of companies faking accounts.

“Fraudulent accounting is a national disaster in Kenya just as corruption has been declared and we need the input of every stakeholder including the police, the National Intelligence Service and the Ethics and Anti-Corruption Commission to curb the vice,” said ICPAK chief executive Patrick Ngumi.

READ: ICPAK to question Imperial Bank auditor

Accountants and auditing firms of listed companies have lately been on the spot for alleged falsifying of company financials in collusion with management at the expense of shareholders.

Customers of Imperial Bank have accused its auditor PKF Consulting for failing to alert them over the fraud even as MPs raised concerns over how Deloitte failed to raise alarm on Mumias Sugar's books.

ICPAK has been accused of paying lip service without taking solid action against auditors as cases of fraud mount.

Also read: MD, PwC under probe over Haco profit scam