VOLUME: X

FINANCIAL REPORTING

PART: Registration of certified auditors of Public Interest Entities and firms ss 2234

CHAPTER: 46:10

22.     Public Interest Entity

            For purposes of this Act "public interest entity" means-

     (a)     any entity that has issued equity or debt securities for public subscription, and which is listed in a stock exchange;

     (b)     any bank, deposit taking institution, or other similar institution that is subject to supervision by the Bank of Botswana;

     (c)     any insurance company, pension and provident fund, collective investment undertaking, and any other similar institution that is subject to supervision by the Non-Bank Financial Institutions Regulatory Authority; or

     (d)     any entity to which any two of the following conditions are applicable in excess of an amount or number the Minister may prescribe in the Regulations-

           (i)       annual revenue,

          (ii)       number of employees,

          (iii)       the total assets, or

         (iv)       total liability, not including shareholder's equity, applicable at the end of the preceding accounting year.

23.     Register

            Subject to the provisions of this Act, the Board shall cause to be kept, maintained and updated, registers in the following manner-

     (a)     Register of Certified Auditors of Public Interest Entities, specifying the name and all relevant particulars of the certified auditor of P.I.E;

     (b)     Register of Firms for Certified Auditors of Public Interest Entities, specifying the name and all relevant particulars of the audit firm; and

     (c)     any other Register for any matter the Authority deems necessary, specifying the relevant information regarding the matter.

24.     Registration of a certified auditor of public interest entity

            (1) Notwithstanding anything contained in the Companies Act, or any other law, a person shall not hold any appointment, or offer any services for remuneration, as a certified auditor of a P.I.E, unless he or she is registered by the Authority as a certified auditor of P.I.E under this Act.

            (2) An application to practise as a certified auditor of a P.I.E may be made by any person holding a practising certificate issued by the Institute, in such form as may be prescribed.

            (3) An application made under subsection (2) shall be accompanied by such fees and information as may be determined by the Authority in its rules.

            (4) Where, after consideration of an application, the Authority is satisfied that the applicant-

     (a)     holds a practising certificate issued by the Institute;

     (b)     is a fit and proper person in accordance with the rules;

     (c)     is a member or employee of a firm and has provided evidence that the firm's quality assurance procedures are appropriate; and

     (d)     meets such other requirements as may be specified in the rules and codes of the Authority,

the Authority shall register the applicant as a certified auditor of P.I.E.

            (5) The Authority shall enter the name of the certified auditor of P.I.E in the Register of Certified Auditors of Public Interest Entities.

            (6) A person who contravenes the provisions of subsection (1) commits an offence and is liable to a fine not exceeding P5 000 for each day the offence continues to occur or to imprisonment for a period not exceeding five years, or to both.

25.     Registration of audit firm for public entity

            (1) An audit firm shall not practise or provide audit services to a public interest entity, unless such firm is registered with the Authority.

            (2) A person shall not practise as a certified auditor of P.I.E in a partnership with other persons or in a registered firm, unless such person has been registered as a certified auditor of P.I.E.

            (3) An application under this section shall be in such form and manner as shall be prescribed by the Authority, and shall be accompanied by such fees and information as may be determined by the Authority in its rules.

            (4) The Authority shall register the firm and enter its name and such particulars as it considers relevant upon being satisfied that-

     (a)     all the partners of the firm who are in the accounting and auditing field, are registered with the Institute;

     (b)     all the partners of the firm who are in the accounting and auditing field, are registered as certified auditors of public interest entities and there is a written undertaking by the applicant firm and such partners, that they shall be bound by the disciplinary provisions of the rules individually;

     (c)     the applicant firm holds a professional indemnity insurance of such amount as the Authority may determine in its rules, or provides such other financial guarantee as the Authority may from time to time determine; and

     (d)     the quality of audits of a firm, including the quality assurance procedures in place in the firm's audit and assurance practice, comply with the standards set by the Authority.

26.     Certificate of registration

            (1) The Authority shall issue a certificate of registration to-

     (a)     a person registered as a certified auditor of P.I.E in accordance with section 24; and

     (b)     an audit firm which has been registered as a firm for certified auditors of public interest entities in accordance with section 25.

            (2) A certificate issued under this section shall be in such form and upon payment of such fees as may be determined by the Authority in its rules.

            (3) A certificate of registration issued in terms of subsection (1) shall be valid for a period of 12 months.

27.     Renewal of registration

            (1) A certificate of registration issued in section 26, shall be renewed annually.

            (2) A person or firm who or which wishes to renew registration shall, not later than three months before its expiration, make a written application to the Authority in such form and manner as may be prescribed by the Authority in its rules.

            (3) Where the Authority is satisfied that the applicant continues to meet the requirements for registration, the Authority shall renew the registration.

            (4) Where the Authority has not dealt with an application for the renewal of registration under subsection (3) before its expiration, the registration shall continue to be in force until the application for renewal is dealt with and any renewal in such case shall be taken to have commenced from the day when the registration would have expired.

28.     Refusal to register a person or firm

            The Authority may refuse to register-

     (a)     a person as a certified auditor of P.I.E where such person does not satisfy the requirements specified in section 24 (4); and

     (b)     an audit firm as a firm for certified auditors of public interest entities where such firm does not satisfy the requirements specified in section 25 (4).

29.     Appeal against refusal to register

            (1) Where the Authority refuses to register an applicant under sections 24 and 25, it shall, by notice in writing, inform the applicant of its decision as soon as practicable, but not later than 14 days after such decision.

            (2) An applicant who wishes to appeal the Authority's refusal to register him or her, or the firm shall, within 14 days of receiving notification of the refusal, submit an appeal, in writing, to the Appeals Committee, specifying the grounds for the appeal, including any facts or legal analyses that may contradict or mitigate the refusal to register.

            (3) Whenever such appeal is received, the committee responsible shall submit a response, in writing, to the Appeals Committee appointed under section 40, within 14 days.

            (4) The Appeals Committee shall review the decision made under subsection (1), and issue its own decision within 30 days, either to affirm or to overrule the decision made by the Authority, and to register the auditor or firm, and shall forthwith notify the applicant in writing of its decision.

30.     Change of name

            (1) Where a certified auditor of P.I.E or firm changes a name or particulars recorded in the relevant register, such auditor or firm, shall, in accordance with the rules, notify the Authority within 30 days of the change.

            (2) A person who fails to comply with subsection (1) shall be liable to a fine not exceeding P50 000.

31.     Cancellation or suspension of registration

            The Authority may either suspend or cancel the registration of a certified auditor of P.I.E or firm, and order the removal of such from the relevant register where the certified auditor of P.I.E or firm-

     (a)     has obtained registration by fraud or misrepresentation;

     (b)     no longer satisfies or has acted in breach of the auditing standards adopted by the Authority or any rules or regulations of the Authority;

     (c)     has been suspended or cancelled as a member under the Institute;

     (d)     no longer satisfies the requirements of sections 24 and 25;

     (e)     has acted in breach of the provisions of this Act; or

     (f)      has been convicted of an offence, whether in Botswana or another jurisdiction-

           (i)       for which he or she could have been sentenced to imprisonment without the option of a fine, or

          (ii)       involving dishonesty.

32.     Restoration of name to register

            Where the certified auditor of P.I.E or firm has been removed from the register or the registration has been suspended, the Authority may either of its own volition, or on the application of the certified auditor of P.I.E or firm concerned, made in such form as may be prescribed, and after holding such inquiry as the Authority may consider necessary, direct that the name of the certified auditor of P.I.E or firm be restored to the register.

33.     Register to be prima facie evidence

            (1) A register specified in this Act shall be prima facie evidence of the matters set out therein.

            (2) Notwithstanding the generality of subsection (1), a certificate purporting to be under the Seal of the Authority to the effect that-

     (a)     the name of a person or firm does not appear in the register shall be prima facie evidence that the person or firm is not registered with the Authority;

     (b)     the name of a person or firm appears in the register shall be prima facie evidence that the person or firm is registered with the Authority; or

     (c)     a person or firm has been suspended from practice as such for the period specified in the register shall be prima facie evidence that the person or firm has been suspended from practice for that period.

            (3) A copy of an entry in the register, a document in the custody of the Authority or an extract from the register or from any document purporting to be certified by the Chief Executive, shall be admitted in evidence in all courts without further proof or production of the original.

34.     Offences in connection with registration

            A person who-

     (a)     makes or causes to be made an unauthorised entry, alteration or deletion in the register;

     (b)     procures or attempts to procure for himself or herself or another person, registration, or a certificate of registration by means of fraud, false pretence or concealment of a material fact;

     (c)     makes or causes to be made in connection with an application for registration, a false declaration in a document used for the purpose of establishing his or her identity;

     (d)     wilfully destroys or renders illegible an entry in the register;

     (e)     without the permission of the holder, wilfully destroys or renders illegible a certificate of registration; or

     (f)      forges or utters, knowing the same to be forged, a document purporting to be a certificate of registration,

commits an offence and is liable to a fine not exceeding P250 000, or to imprisonment for a term not exceeding five years, or to both.