It is reasonable for the accounting profession to share the cost of the proposed Independent Investigation Board, Secretary for Financial Services & the Treasury Frederick Ma says.

In his latest FSTB & You column, posted on the Financial Services & the Treasury website, Mr Ma said investigating auditors has always been one of the Society of Accountants' duties.

The board will handle alleged accounting, auditing and ethical irregularities committed by professional accountants related to listed companies.

Accounting profession will benefit

Noting the board's purpose is to enhance the independence and credibility of such inquiries, he said it is unreasonable to transfer the investigation costs to other sectors as they have all along been borne by the accounting sector.

"The accounting profession will benefit from the proposal, as it would enhance the quality of auditing services," Mr Ma said, adding in other jurisdictions like the US and UK, Canada and Australia, the funding of similar bodies comes in part from the sector.

"We propose the cost of the board be shared among the Securities & Futures Commission, HK Exchanges & Clearing, the accounting profession and the Government. The Government's contribution would be borne by the Companies Registry Trading Fund," he said.

"We are discussing the relevant issues with the above parties and, mostly, their initial responses have been positive. We will continue the discussions with a view to reaching a consensus on the way forward as soon as possible."

Sector must co-operate

To increase the confidence of the investing public in the accounts of listed companies, the sector should fully co-operate with the Government in improving the existing regulatory regime, he said.

"I hope members of the Legislative Council, in considering this issue, will support our proposals in the wider public interest. I hope all directors and auditors of companies will always bear in mind the remark made by former Premier Zhu Rongji - 'don't prepare false accounts'."