Recent disciplinary orders - Hong Kong Institute of Certified Public Accountants

Disciplinary orders / Determination

Order Date
Name/
Relevant sub-sections of the PAO
Nature of complaint
Sanction
3 July 2018Lee Yiu Sun
 
(ENG)
(CHI)

The respondent was the Executive Director, Chief Executive Officer and the Compliance Officer of a Hong Kong listed company. He was found by the Court of First Instance in a court action filed by Securities and Futures Commission to have breached his director's duties to the company by falsely putting forward a non-existent agreement, causing the company to wrongly pay a dividend of RMB18.69 million. The respondent was ordered to be disqualified from being a director or involved in the management of any listed or unlisted corporation in Hong Kong for five years.

 

The respondent was found to have not complied with the Code of Ethics for Professional Accountants and was guilty of professional misconduct.

Order:
Removal from the register of CPAs for 3 years with effect from 12 August 2018

 

Penalty:
-

 

Costs:
HK$35,857

 

Extract of Reasons and Order

26 June 2018

Seto Man Fai


(ENG)
(CHI)

Failure or neglect to observe, maintain or otherwise apply professional standards issued by the Institute and being guilty of professional misconduct.


The respondent was a former practising certified public accountant whose name was removed from the register for 5 years with effect from 22 March 2018 pursuant to an earlier disciplinary order. He was previously a director of a corporate practice, which has now been de-registered. The corporate practice audited the consolidated financial statements of a Hong Kong listed company for the year ended 31 March 2011 and the period ended 31 December 2011 and expressed unmodified auditor's opinions. The respondent was the engagement director of those audits.


There were significant deficiencies in the accounting treatment of certain acquisition transactions, convertible bonds issued and share options and warrants granted which were included in the financial statements. The respondent claimed that relevant audit procedures were carried out on those items but he failed to provide any working papers, claiming that they were withheld by a third party.

Order:
No practising certificate shall be issued to the respondent for 12 months from 21 March 2023.

 

Penalty:
-

 

Costs:
HK$277,705.60
(including FRC costs)

 

Extract of Reasons and Order

20 June 2018

1. Andrew David Ross
2. Fok Wai Ming
3. Baker Tilly Hong Kong Limited

 

(ENG)
(CHI)

 

Failure or neglect to observe, maintain or otherwise apply professional standards issued by the Institute.


The 3rd respondent was a newly appointed auditor who audited the consolidated financial statements of a Hong Kong listed company and its subsidiaries for the year ended 31 March 2012. The 1st respondent was a director of the corporate practice who issued the auditor's report. The 2nd respondent was a director of the corporate practice who was substantially involved in the audit.


The group's financial statements in previous years included errors in the accounting treatment of a substantial acquisition. Those errors affected the 2012 financial statements. Deficiencies were found in the audit procedures conducted by the respondents on the balances pertaining to the acquisition. Further, the 3rd respondent did not have adequate policies and procedures for clear designation of engagement director and appointment of an engagement quality control reviewer in the subject audit.

Order:
Reprimand

 

Penalty:
1st Respondent
HK$100,000
2nd Respondent
HK$100,000
3rd Respondent
HK$250,000

 

Costs:
HK$117,372.20
(including FRC costs)

 

Extract of Reasons and Order

24 May 2018

1. Baker Tilly Hong Kong Limited
2. Au Yiu Kwan

 

(ENG)
(CHI)

Failure or neglect to observe, maintain or otherwise apply professional standards issued by the Institute.

 

The 1st Respondent was in breach of a number of auditing standards and HKSQC1. The 2nd Respondent failed to act diligently in accordance with sections 100.4(c) and 130.1 of the Code of Ethics for Professional Accountants.


The 1st Respondent audited the financial statements of a Hong Kong listed company and its subsidiaries for the year ended 31 May 2006  The 2nd Respondent was the director who had substantial involvement in the audit.

Order:
Reprimand


Penalty:
1st Respondent
HK$250,000
 
2nd Respondent
HK$100,000


Costs:
HK$156,669.90
(including FRC costs)


Extract of Reasons and Order

15 May 2018

1. Tang Wai Hung


 2. Chow Chi Kit


3. W.H. Tang & Partners CPA Limited

 

(ENG)
(CHI)

Failure or neglect to observe, maintain or otherwise apply professional standards issued by the Institute.

 

The 3rd respondent issued an unqualified auditor's opinion on the 2012 financial statements of a Hong Kong listed company, and its subsidiaries. The 1st respondent was the engagement director and the 2nd respondent was the engagement quality control reviewer of the audit. There were non-compliance with financial reporting standards and auditing irregularities in relation to an acquisition recorded in the financial statements.

Order:
Reprimand


1st Respondent
Cancellation of practising certificate with effect from 24 June 2018 and no practising certificate shall be issued to him for 2 years.


2nd Respondent
Cancellation of practising certificate with effect from 24 June 2018 and no practising certificate shall be issued to him for 18 months.


Penalty:
1st Respondent
HK$100,000

2nd Respondent
HK$75,000

3rd Respondent
HK$150,000
 
Costs:
All Respondents jointly
HK$103,483.20(including FRC costs)
 
 Extract of Reasons and Order

2 May  2018

Yan Kwok Ting, Sunny

(ENG)
(CHI)

Guilty of dishonourable conduct.


The respondent was a licensed person under the Securities and Futures Ordinance and an employee of a company which sponsored a listing on the Growth Enterprise Market board. The Securities and Futures Commission investigated into the company's submissions to the Stock Exchange of Hong Kong about due diligence work it carried out as the sponsor.  The Commission found the respondent guilty of providing false and misleading information during the investigation, and prohibited him from re-entering the industry for 4 years.  The Securities and Futures Appeals Tribunal subsequently dismissed the respondent's appeal and upheld the Commission's finding and decision.

Order:
Removal from the register of CPAs for 5 years with effect from 13 June 2018
 
Penalty:
-
 
Cost
HK$262,499.
 
Extract of Reasons and Order
25 April 2018Yeung, Tat Kwong
(ENG)
(CHI)

Failure or neglect to observe, maintain or otherwise apply professional standards issued by the Institute.

 

The Respondent issued Accountant's Reports on a firm of solicitors for three years, in which he failed to report the firm's breaches of the Solicitors' Accounts Rules . The firm did not prepare client account reconciliations, client ledgers and office ledgers. During the Institute's enquiry, the Respondent was unable to provide copies of his working papers, claiming that the hardcopies were misplaced and his computer hard disk had failed.

 

Order:
Reprimand

 

Penalty:
HK$100,000


Costs:
HK$49,335


Extract of Reasons and Order

20 April 2018Chan Kin Cheong
(ENG)
(CHI)

Failure or neglect to observe, maintain or otherwise apply professional standards issued by the Institute.

 

The respondent is the sole proprietor of two practices. He is responsible for the practices' quality control system and the quality of the practices' audit engagements. When carrying out a practice review, the reviewer found that the practices failed to implement an adequate system of quality control. Also, a number of significant deficiencies were found in an audit engagement. In addition, the respondent was found to have provided false and/or misleading information during the practice review and in the electronic self–assessment questionnaire which was submitted to the reviewer.

Order:
Reprimand


Penalty:
HK$60,000
 
Cost:
HK$34,175
 
Extract of Reasons and Order

6 April 2018

1. HLB Hodgson Impey Cheng

 

2. Cheng Chung Ching, Raymond

 

3. Lai Tak Shing, Jonathan

 


(ENG)

(CHI)

 Failure or neglect by the 1st and 2nd Respondents to observe, maintain or otherwise apply Standard on Assurance Engagements 200 "High Level Assurance Engagements" (SAE 200). Failure or neglect by the 1st and 3rd Respondents to observe, maintain or otherwise apply SAE 200 and Hong Kong Standard on Assurance Engagements 3000 "Assurance Engagements Other Than Audits or Reviews of Historical Financial Information".

 

The 1st Respondent issued compliance reports on a corporation engaged in securities dealing under the Securities and Futures Ordinance (Cap. 571) and the preceding Securities Ordinance (Cap. 333) for three years. The 2nd Respondent was the engagement partner in the first year. The 3rd Respondent was the engagement partner in the second and third years.

 

The complaints against the three Respondents relate to breaches of the standards of assurance practices and sufficiency of documentation in the work undertaken by the Respondents for the securities firm for three relevant fiscal years.

Order:

Reprimand for all three respondents

 

Penalty:

1st Respondent

HK$400,000

 

2nd Respondent

HK$300,000

 

3rd Respondent

HK$300,000

 

Costs:

HK$3,000,000

 

Decision

 

Decision on sanctions and costs

27 March 2018

1. Lau Shiu Wai, Franklin
2. Au Yeung Tin Wah
3. Lau & Au Yeung

   C.P.A   Limited
 
(ENG)
(CHI)

 Failure or neglect by the 3rd respondent to observe, maintain or otherwise apply Hong Kong Standard on Auditing ("HKSA") 230 and HKSA 500.  Failure or neglect by the 1st respondent to act diligently in accordance with section 100.5 (c) as elaborated in section 130.1 of the Code of Ethics for Professional Accountants ("COE").

 

Failure or neglect by the 2nd respondent to act diligently in accordance with section 100.5 (c) as elaborated in section 130.1 of the COE for failure to carry out an objective engagement quality control review under HKSA 220.

 

The 3rd respondent audited the financial statements of a Hong Kong listed company and its subsidiaries for the years ended 30 June 2011 and 2012. The 1st respondent was the engagement director who issued the auditor's reports on behalf of the 3rd respondent and the 2nd respondent was the engagement quality control reviewer.

 

Order:
Reprimand
 
Penalty:
1st & 2nd  Respondent
HK$100,000 each

3rd Respondent
HK$180,000
 
Costs:
All Respondents
HK$154,567.90(including FRC costs)
 
Extract of Reasons and Order

25 August 2017

Lam Kin Choi
(ENG)
(CHI)

 Failure or neglect to observe, maintain or otherwise apply (i) HKSQC 1 "Quality Control for Firms that Perform Audits and Reviews of Financial Statements, and Other Assurance and Related Services Engagements"; (ii) HKSA 500 "Audit Evidence"; and (iii) HKSAE 3000 "Assurance Engagements Other Than Audits or Reviews of Historical Financial Information".

 

The complaint arose from findings of a practice review visit on the Respondent's practice. The Respondent was found to have failed to implement an adequate system of quality control. In addition, a number of significant deficiencies were identified in the Practice's audits and assurance engagements.

 

The Respondent's appeal against the Disciplinary Committee's decision was struck out by the Court of Appeal on 6 April 2018.

Order:
Cancellation of practising certificate with effect from 13 February 2018 and no practising certificate shall be issued to the Respondent for 12 months.


Penalty:
HK$20,000
 
Cost
HK$46,827

 


Extract of Reasons and Order

1 March 2018

1.Lam Kwan, Anthony
 
2. Charles H. C. Cheung  

    & CPA Limited

 

(ENG)
(CHI)

Failure or neglect to observe, maintain or otherwise apply auditing standards issued by the Institute.


The 2nd respondent audited the financial statements of a renovation project of a residential building. The 1st respondent was the engagement director.

 

The respondents failed to understand the scope of the audit engagement and plan it accordingly. They also failed to obtain sufficient evidence and adequately document audit procedures. The complaint was made under section 34(1AAA) of the Professional Accountants Ordinance.

 

Order:
Reprimand

 

Penalty:
HK$35,000
 
Cost:
HK$ 10,000
 
Extract of Reasons and Order

20 February 2018Chan Wing Keung, Simon
 
(ENG)
(CHI)
Failure or neglect to observe, maintain or otherwise apply the fundamental principle of Competence and Due Care in the Code of Ethics for Professional Accountants.
 
The respondent issued an accountant's report on a solicitor's firm, in which he failed to report the firm's breaches of the Solicitors' Accounts Rules including rules over handling of client money. The respondent did not comply with a number of provisions of the Institute's Practice Note 840 when he carried out procedures in relation to the accountant's report.
Order:
Reprimand;
and cancellation of practising certificate with effect from 3 April 2018 and no practising certificate shall be issued to the respondent for 12 months.
 
Penalty:
-
 
Cost:
HK$ 56,204
 
Extract of Reasons and Order
8 September 2015

1.Wong Tak Man, Stephen


2. RSM Hong Kong (formerly RSM Nelson Wheeler)


(ENG)
(CHI)

Failure or neglect to observe, maintain or otherwise apply professional standards issued by the Institute.


The Respondents audited the financial statements of a Hong Kong listed company and its subsidiaries and were found to have failed to properly interpret Hong Kong Accounting Standard ("HKAS") 39 Financial Instruments: Recognition and Measurement, which requires an entity to recognize an impairment loss in profit or loss for an available-for-sale financial asset when objective evidence of impairment exists.


The Respondents' appeal against the Disciplinary Committee's decision was dismissed by the Court of Final Appeal on 22 December 2017 (FACV10/2017).

Penalty:
HK$10,000 each
 
Cost
HK$95,401
 
Extract of Reasons and Order
7 February 2018

Yu Oi Kee

 

(ENG)
(CHI)

Convicted of an offence involving dishonesty.


The respondent was convicted in the District Court in August 2014 of one count of conspiring as an agent to use a document with intent to deceive her principal, and one count of accepting an advantage as an agent.


The respondent was a director of a subsidiary of a Hong Kong listed company. She conspired with another director to make a false statement in the board meeting minutes to conceal the interests of that director in a material disposal transaction entered into by the company. Accordingly, the transaction was incorrectly announced as an unconnected transaction and was not reported to the Stock Exchange of Hong Kong as a connected transaction. As a reward for her part in processing the transaction, she privately accepted the listed company's shares given to her by the other director. She later sold the shares in the market and received about HK$317,000.

Order:
Removal from the register of CPAs for 4 years with effect from 24 March 2018
 
Penalty:
-
 
Cost
HK$36,165
 
Extract of Reasons and Order
31 January 2018

Seto Man Fai


(ENG)
(CHI)

The respondent was the managing director of a corporate practice, Parker Randall CF (H.K.) CPA Limited, which is now de-registered. The corporate practice audited the consolidated financial statements of three Hong Kong listed companies for financial periods ended in 2010 and 2011. The respondent was the engagement director.

 

The Financial Reporting Council (FRC) enquired into breaches of auditing standards in the audits. The respondent failed to provide the working papers and repeatedly gave inconsistent and unbelievable explanations to the FRC as to why the working papers were unavailable. There were irregularities in the audits in relation to accounting for an acquisition, use of the going concern basis and failure to appoint an engagement quality control reviewer.


The respondent was found to have breached a number of HKSAs, the Code of Ethics for Professional Accountants Ordinance and was guilty of professional misconduct.

Order:
Removal from the register of CPAs for 5 years with effect from 22 March 2018
 
Penalty:
-
 
Cost
HK$523,697.20
(including FRC costs)
 
Extract of Reasons and Order

 

30  January 2018

Mak Wai Man


(ENG)
(CHI)

The respondent was convicted of offences involving dishonesty. She was also in breach of the fundamental principle of Integrity under sections 100.5(a) and 110.2 of the Code of Ethics for Professional Accountants.

 

The respondent was convicted of three counts of offences under section 9 of the Theft Ordinance (Cap 210) after she forged the signature one of her employer's directors and drew a cheque in her own favour. As a result, the company dismissed her. Subsequently, she provided false information about her professional qualifications and work experience to another employer.  That employer unknowingly submitted the false information in an Application Proof to the Hong Kong Stock Exchange for listing purposes. The respondent failed to declare to the Institute that she had  criminal convictions in the Institute's annual membership renewal.

Order:
Removal from the register of CPAs for 5 years with effect from 11 March 2018
 
Penalty:
-
 
Cost
HK$72,446
 
Extract of Reasons and Order

 

23 January 2018

Tso Yin Yee

 

(ENG)
(CHI)

Failure or neglect to observe, maintain or otherwise apply professional standards issued by the Institute and being guilty of professional misconduct.

 

The respondent is the sole proprietor of a Practice and is responsible for the Practice's quality control system and the quality of its assurance engagements.  When carrying out a practice review, the reviewer found that the Practice failed to established and maintain an effective system of quality control. In addition, the reviewer found significant deficiencies in the Practice's audit and assurance engagements.

 

Order:
Cancellation of practising certificate with effect from 6 March 2018 and no practising certificate shall be issued to the Respondent for 16 months
 
Penalty:
-
 
Cost:
HK$38,665
 
Extract of Reasons and Order
16 January 2018

1) Tam Tak Kuen, Alfred
2) Alfred T.K. Tam & Co


(ENG)
(CHI)

Failure or neglect to observe, maintain or otherwise apply the fundamental principle of Professional Behavior of the Code of Ethics for Professional Accountants.

 

The 1st Respondent was the sole proprietor of the 2nd Respondent, a firm which is now de-registered. The Respondents breached their employer's obligation to make provident fund contributions for employees under the Mandatory Provident Fund Schemes Ordinance on three occasions.  They were fined by the relevant authorities for the breaches.

Order:
Reprimand
 
Penalty:
HK$414,463.40
 
Costs:
HK$32,781
 
Extract of Reasons and Order
5 January 2018

1) Andrew David Ross
2) Fok Wai Ming
3) Baker Tilly Hong Kong Limited


(ENG)
(CHI)

Failure or neglect to observe, maintain or otherwise apply professional standards issued by the Institute.


The 3rd Respondent was in breach of a number of auditing standards and HKSQC1.  The 1st and 2nd Respondents failed to act diligently in accordance with section 100.4 (c), as elaborated in sections 130.1 of the Code of Ethics for Professional Accountants.  In addition, the 1st Respondent was in breach of HKSA220.


The 3rd Respondent audited the financial statements of a Hong Kong listed company and its subsidiaries for the years ended 31 December 2008 and 2009.  The 1st Respondent was the director who issued the auditor's reports on behalf of the 3rd Respondent and the 2nd Respondent, as a senior audit team member, was substantially involved in the audits of the financial statement.

 

Order:
Reprimand

 

Penalty:
1st & 2nd  Respondent
HK$100,000


3rd Respondent
HK$250,000
 
Costs:
2nd Respondent
HK$14,912


All Respondents
HK$124,448.3 (including FRC costs)

 

Extract of Reasons and Order

4 January 2018

Chan Hoi Shing

 

(ENG)
(CHI)

Failure or neglect to observe, maintain or otherwise apply a number of professional standards and being guilty of professional misconduct.

 

The complaint arose from findings of a practice review visit on the Respondent's practice. The Respondent was found to have failed to establish and maintain an effective system of quality control and have misused qualified opinions to circumvent necessary audit procedures.

Order:
Cancellation of practising certificate with effect from 8 February 2018 and no practising certificate shall be issued to the Respondent for 6 months
 
Penalty:
-
 
Cost:
HK$25,000
 
Extract of Reasons and Order
12 December 2017

1) Baker Tilly Hong Kong 

    Limited


2) Andrew David Ross


3) Kwok Lai Ha, Helena


(ENG)
(CHI)

Failure or neglect to observe, maintain or otherwise apply professional standards, namely, the fundamental principle of Professional Competence and Due Care in the Code of Ethics for Professional Accountants.


The Securities and Exchange Commission had imposed sanctions on the respondents for breaches of PCAOB auditing standards in their audit of a U.S. listed company.  The respondents failed to identify material related party transactions and revise the audit planning regarding fraud risks in light of those transactions.


The 2nd respondent was the engagement director, and the 3rd respondent was the director-in-charge.

Order:
Reprimand
 
Penalty:
1st Respondent
HK$100,000
2nd Respondent
HK$70,000
 3rd Respondent
HK$30,000
 
Cost of HKICPA
HK$300,000
 
Extract of Reasons and Order
12 October 2017

Tam Tak Kuen, Alfred

(ENG)
(CHI)

Failure or neglect to observe, maintain or otherwise apply HKSQC 1 and the fundamental principle of integrity under paragraphs 100.5(a) and 110.2 of the Code of Ethics for Professional Accountants, and guilty of professional misconduct.

 

The complaint arose from findings of a practice review visit on the Respondent's Practice. The Respondent was found to have failed to establish, maintain and document an effective system of quality control and provided false or misleading answers and/or furnished information recklessly in the electronic practice review self-assessment questionnaire.

Order:
Reprimand; and cancellation of practising certificate with effect from 21 November 2017 and no practising certificate shall be issued to the Respondent for 2 years

Penalty:
HK$50,000
 
Cost
HK$51,628

 

Extract of Reasons and Order

5 September 2017

Tse Lap Fu, Lawrence
(ENG)

(CHI)

Failure or neglect to observe, maintain or otherwise apply professional standards issued by the Institute and being guilty of professional misconduct.

 

There were deficiencies in the audits of the financial statements of five private companies carried out by Tse's firm. The audit areas involved were related party transactions, deferred tax, inventory and evaluation of whether the financial statements were prepared in accordance with the applicable financial reporting framework.  In addition, Tse's firm acted as auditor of one of the companies when it had a close business relationship with that company.

Order:
Reprimand; and cancellation of practising certificate with effect from 15 October 2017 and no practising certificate shall be issued to the Respondent for 6 months

 

Penalty:
HK$50,000
 
Cost
HK$123,108


Corrigendum


Extract of Reasons and Order

1 September 2017

So Kwok Keung, Keith

(ENG)

(CHI)

 

Failure or neglect to observe, maintain or otherwise apply (i) Hong Kong Standard on Auditing ("HKSA") 230 "Audit Documentation"; and (ii) HKSA 500 "Audit Evidence".


So is a practising director of a corporate practice. The practice was selected for a practice review and significant deficiencies were found in the Practice's audit engagement of a Hong Kong listed company. So was the engagement director for the audit engagement.

Order:
Reprimand


Penalty:
HK$60,000
 
Cost
HK$33,004

 

Extract of Reasons and

Order

14  August 2017

Poon Wai Kit
(ENG)

(CHI)

Poon was convicted of theft in the District Court in July 2016.  He also falsified or caused to be falsified documents.

 

Poon misappropriated a total sum of about HK$12 million during his employments with two companies.  He falsified certain documents to cover up his acts.

Order:
Removal from the register of CPAs permanently with effect from 23 September  2017
Penalty:
-
 
Cost
HK$17,130.00
 
Extract of Reasons and Order
6 July 2017

Charles Pearson Fearn
(ENG)

(CHI)

Failure or neglect to observe, maintain or otherwise apply professional standards and guilty of professional misconduct.


Fearn was the sole proprietor of a CPA firm which audited the financial statements of a company for four consecutive periods. The company was registered and regulated under the Trustee Ordinance to provide trust services. There were significant deficiencies in planning the audits, obtaining evidence and preparing audit documentation. As a result, Feam did not properly verify the company's compliance with the relevant legal and regulatory framework, the nature of significant balances between the company and related parties, and the implications of large sums of the company's client monies not being held separately at a bank.

Order:

Cancellation of practising certificate with effect from 15 August 2017 and no practising certificate shall be issued to the Respondent for 12 months.

 

Penalty:
-
 
Cost
HK$60,069
 
Extract of Reasons and Order

6 July 2017

Cheung Chun Bong
(ENG)

(CHI)

Conviction of an offence involving dishonesty.


Cheung was convicted in May 2016 at the Magistrates' Court of theft.

Order:

Reprimand
 
Penalty:
HK$5,000
 
Cost
HK$21,497.4
 
Extract of Reasons and Order

9 June 2017

1) Lai Ka Cheung, Andrew

2) Andrew K. C. Lai & Company

(ENG)

(CHI)

The 1st and the 2nd Respondent failed to comply with a number of professional standards in their audits and were guilty of professional misconduct as a result of their multiple and repeated failures.

 

The 1st Respondent is the sole proprietor of the 2nd Respondent which was the auditor an approved charitable institution in Hong Kong. The 2nd Respondent expressed an unqualified opinion in each of the auditor's reports issued on the Company's financial statements for six years ended from 31 March 2010 to 2015.  Deficiencies were found in the audit work carried out by the respondents in all six years.

Order:
1st Respondent
Cancellation of practising certificate with effect from 19 July 2017 and no practising certificate shall be issued to him for one year.

 

2nd Respondent
Reprimand
 
Penalty:
-
 
Cost
HK$77,140
 
Extract of Reasons and Order

7 June 2017

Wong Kong Yiu,
Nigel
(ENG)

(CHI)

Wong failed to comply with the Corporate Practices (Registration) Rules and Corporate Practices (Professional Indemnity) Rules. He was also in breach of section 110.2 of the Code of Ethics for Professional Accountants and guilty of dishonourable conduct. In addition, Wong failed to comply with a direction issued by the Practice Review Committee ("PRC") without reasonable excuse.

 

Wong was the sole practising director and shareholder of a corporate practice. He failed to renew Professional Indemnity Insurance ("PII") cover of his practice for four consecutive years and to arrange Run-Off cover upon the de-registration of the practice. In addition, Wong falsely declared to the Institute that the practice had PII cover when he applied for renewal of the practice's registration for each of the four years.

 

Wong's other practice was selected for a practice review. He failed to comply with a direction of the PRC requiring him to cooperate with the practice reviewer to confirm a date for the site visit.

Order:

Removal from the register of CPAs for 5 years with effect from 19 July 2017

 

Penalty:

-

 

Cost

HK$94,050

 

Corrigendum

 

Extract of Reasons and Order

7 June 2017

Chan Wone Yee
(ENG)

(CHI)

Chan was convicted of an offence involving dishonesty and guilty of conduct which renders her unfit to become a certified public accountant under by-laws 34(1)(b) and 34(1)(d) of the Professional Accountants By-Laws.

 

Chan was registered as a student. She falsified a reference letter purporting that it was issued by her former employer and used the letter to successfully apply for a job. Chan was convicted in the Magistrates' Courts of obtaining pecuniary advantage by deception under the Theft Ordinance. In replying to the Institute's enquiry of her about the matter, Chan made untruthful submissions.

Order:
Removal from student register with effect from 5 July 2017


Penalty:
-


Cost:
HK$46,908.40
 
Extract of Reasons and Order

17 May
2017

1) Pan-China (H.K.) CPA  

     Limited
2) Tsang Chiu Keung
3) Chan Kin Wai
(ENG)

(CHI)

The 1st and 2nd Respondents were in breach of auditing standards and the Fundamental Principle of Professional Competence and Due Care in the Code of Ethics for Professional Accountants. The 3rd Respondent was in breach of HKSA220.

 

The 1st Respondent audited the financial statements of a Hong Kong listed company and its subsidiaries for the years ended 31 December 2010 and 2011 and expressed an unmodified auditor's opinion for each of the two years. The 2nd Respondent was the engagement director for both years.  The 3rd Respondent was the engagement quality control reviewer for 2011 audit.

 

The complaint concerned deficiencies in the audit work conducted on impairment assessment of the company's interests in natural resource extraction and mining projects included in the financial statements.

Order:
Reprimand

 

Penalty:
1st Respondent
HK$80,000
2nd Respondent
HK$50,000
 3rd Respondent
HK$60,000

 

Cost of HKICPA
HK$42,580
 
Cost of FRC
HK$82,805.30

 

Extract of Reasons and Order

11 May
2017 

Ip Wing Lun, Allan
(ENG)

(CHI)

Guilty of dishonourable conduct under section 34(1)(a)(x) of the Professional Accountants Ordinance.


Ip was convicted of conspiracy to offer advantages to the chairman of a listed company in Hong Kong.  The advantages were offered to induce the chairman to act in a fraudulent scheme concerning the company's substantial acquisition of a mining business.  Ip participated actively in that scheme.

Order:
Removal from the register of CPAs for 8 years with effect from 30 June 2017

 

Penalty:
-

 

Cost:
HK$22,618

 

Extract of Reasons and Order

6 December 2016

So Kin Po
(ENG)

(CHI)

Convicted of an offence involving dishonesty.

 

So submitted falsified documents in his application to the Continuing Education Fund of the Hong Kong Government ("CEF") for reimbursement of the Qualification Programme course fees. The CEF office discovered the falsified documents and reported the matter to the police.  So was convicted in the Magistrates' Courts for fraud.

Order:
Removal from the register of CPAs for 5 years with effect from 17 January 2017


Penalty:
-


Cost:
HK$88,326.3


Extract of Reasons and Order

12 October 2016

Wong Wing Hong
(ENG)

(CHI)

Wong, as the engagement partner, failed to act diligently in accordance with section 100.4(c) as elaborated in section 130.1 of the then applicable Code of Ethics for Professional Accountants because the firm, of which he was formerly a partner, failed or neglected to observe, maintain or otherwise apply a number of auditing standards in an audit of the financial statements of a Hong Kong listed company and its subsidiaries.

Order:

Reprimand; and
Practising certificate shall not be issued to him for 2016 and 2017


Penalty:
HK$60,000


Cost:
HK$24,730

 

Extract of Reasons and Order

12 September 2016

1)Yuen Suk Ching
2)Leung Tai Keung
(ENG)

(CHI)

Failure or neglect to observe, maintain or otherwise apply professional standards issued by the Institute. 
The 1st Respondent was in breach of HKSA 700 Forming an Opinion and Reporting on Financial Statements and HKSA 500 Audit Evidence.  The 2nd Respondent was in breach of HKSA 220 Quality Control for an Audit of Financial Statements.


The complaint concerned deficiencies in the audit work carried out on an investment in two convertible bonds recorded in the financial statements of a Hong Kong listed company.

 

Order:
Reprimand


Penalty:
1st Respondent
HK$70,000

2nd Respondent
HK$50,000

 

Cost of HKICPA
HK$36,055

 

Cost of FRC
HK$18,068.60

 

Extract of Reasons and Order

20 September 2016

Chow Chi Hing
(ENG)

(CHI)

Failure or neglect to observe, maintain or otherwise apply the fundamental principle of professional competence and due care under section 100.5(c), as elaborated in section 130 of the Code of Ethics for Professional Accountants.

 

Chow practiced in his own name and issued an auditor's report on the financial statements of a private company for the year ended 31 December 2011.  The auditor's report did not include a modified opinion in respect of the Company's failure to disclose a material amount owed to a director and payments to directors as related party transactions in the financial statements.

Order:

Reprimand


Penalty:
HK$15,000


Cost:
HK$60,021

 

Extract of Reasons and Order

11 August 2016

Ng Kwong Sang
(ENG)

(CHI)

Failure or neglect to observe, maintain or otherwise apply HKSQC 1 and the fundamental principles of integrity and professional competence and due care under sections 100, 110 and 130 of the Code of Ethics for Professional Accountants.

 

The complaint arose from findings of a practice review visit on the Respondent's Practice. The Respondent was found to have failed to establish, maintain and document an effective system of quality control in respect of monitoring and provided false or misleading answers in the electronic self-assessment questionnaire.

Order:
(a) Reprimand; and
(b) Cancellation of practising certificate with effect from 22 September 2016 and no practising certificate shall be issued to him for one year.

 

Penalty:
HK$65,000
 
Cost:
HK$26,123

 

Extract of Reasons and Order

9 August 2016

Au Yeung Keung, Steve
(ENG)

(CHI)

Guilty of dishonourable conduct. In 2002 to 2003, the Respondent was the General Manager - Financial and Commercial Affairs and Company Secretary of a Hong Kong listed company. He knowingly made or assisted in making misrepresentations or misleading statements to the Stock Exchange of Hong Kong Limited that an investment project in a gas pipeline business in 2002 was a genuine one when he knew that it was not. He also participated in the subsequent sham disposal of the project in 2003.

Order:
Removal from the register of CPAs for 3 years with effect from 18 September 2016


Penalty:

N/A


Cost:
HK$200,000

 

Corrigendum


Extract of Reasons and Order

28 July 2016

Lam Kin Kun, Arthur

(ENG)
(CHI)

Failed or neglected to comply with a direction issued by the Practice Review Committee ("PRC") under section 32F(2)(b) of the Professional Accountants Ordinance.

Order:
Cancellation of practising certificate with effect from 6 September 2016 and no practicing certificate shall be issued to him for twelve months

 

Penalty:
N/A


Cost:
HK$37,648

 

Extract of Reasons and Order

20 June 2016

Wu Kit Man, Athena
(ENG)

(CHI)

Conviction of an offence involving dishonesty. The Respondent was convicted of theft in Hong Kong for having taken cash belonging to another person from an ATM machine.

Order:
Reprimand
 
Penalty:
HK$5,000
 
Cost:
HK$28,211

 

Extract of Reasons and Order

 

21 April 2016

 

Sek Wai Tong, Stonely
(ENG)

(CHI)

Failure or neglect to observe, maintain or otherwise apply HKSQC 1 and a number of other professional standards.

 

The complaint arose from findings of the follow-up practice review visit on the Respondent's Practice.  The Respondent was found to have continued to fail to implement an adequate system of quality control and address audit deficiencies which were identified in the previous practice review. 

Order:
Reprimand
 
Penalty:
HK$50,000
 
Cost:
HK$34,672

 

Extract of Reasons and Order

8 March 2016Chan Ying Kit
(ENG)
(CHI)

Failure or neglect to observe, maintain or otherwise apply Hong Kong Standard of Auditing ("HKSA") 500 Audit Evidence and HKSA 700 Forming an Opinion and Reporting on Financial Statements.

 

Chan audited the financial statements of two Hong Kong private companies for the period ended 31 December 2010.  In one of the audits, Chan failed to obtain sufficient evidence for a material expenditure.  In the other audit, he failed to assess the adequacy of financial statement disclosure and obtain sufficient evidence to conclude the financial statements were free of material misstatements, regarding investments in two subsidiaries.

 

Order:
Reprimand
 
Penalty:
HK$50,000
 
Cost:
HK$96,158.60


Corrigendum


Extract of Reasons and Order

3 February 2016

Chan Bing Chung

(ENG)

(CHI)

Failure or neglect to observe, maintain or otherwise apply paragraphs 100.4(c) and 130.1 of the Code of Ethics for Professional Accountants for failure to act diligently when carrying out the work as an engagement quality control reviewer ("EQCR") in the audit of the 2009 financial statements of a Hong Kong listed company.


The company failed to correctly account for issued share options in its 2007, 2008 and 2009 financial statements in accordance with International Financial Reporting Standard 2 "Shared-based Payment".

 

The Respondent's appeal against the Disciplinary Committee's decision was dismissed by the Court of Appeal on 6 March 2018 (CACV 47/2016).  Following this, his practising certificate was cancelled on 4 April 2018. 

Order:
Cancellation of practising certificate with effect from 4 April 2018 and no practising certificate shall be issued to him for 9 months.

 

Penalty:
HK$50,000


Cost:
HK$125,966.7 (including FRC costs)

 

Extract of Reasons and Order

31 December 2015

1) Leung Kam Man Victor
2) WB CPA Limited
(ENG)

(CHI)

Failure or neglect to observe, maintain or otherwise apply the Corporate Practices (Registration) Rules, Hong Kong Standard on Auditing 230 and 500, sections 130 and 440 of the Code of Ethics for Professional Accountants and guilty of professional misconduct.


The 2nd Respondent was appointed as auditor of six private companies and completed audits of the financial statements of two of the companies. The 1st Respondent was the engagement director. There were deficiencies in the two audits completed and in the engagement acceptance procedures for all six companies.

 

 

Order:
1st Respondent
Cancellation of practising certificate with effect from 9 February 2016 and no practising certificate shall be issued to him for 3 months.

 

2nd Respondent
Reprimand

 

Penalty:
N/A


Cost:
HK$69,812

 

Extract of Reasons and Order

29 December 2015

Ho Lap Wing, Anthony
(ENG)

(CHI)

Failure or neglect to observe, maintain or otherwise apply HKSQC 1 "Quality Control for Firms that Perform Audits and Reviews of Financial Statements, and Other Assurance and Related Services Engagements", Hong Kong Standard on Auditing ("HKSA") 500 "Audit Evidence" and paragraph 100.5(c) and 130 Code of Ethics for Professional Accountants ("COE").

 

The Respondent's practice was selected for practice review. Subsequent follow up practice review visit indicated that the Practice continued to fail to take appropriate actions in response to the quality control deficiencies previously identified. In addition, the practice review also identified a number of deficiencies in the Practice's audit engagements of two clients.

Order:
Cancellation of practising certificates issued to the Respondent in 2015
and the same shall not be issued to him for year 2016

 

Penalty:
N/A


Cost:
HK$22,226

 

Extract of Reasons and Order

 

21 December 2015

1) Choi Man Chau, Michael
2) Chan Kin Wai
3) Pan China (HK) CPA 

     Limited

(ENG)

(CHI)

 

Failure or neglect to observe, maintain or otherwise apply professional standards issued by the Institute.

 

The 1st and the 3rd Respondents were in breach of HKSAs 230 Audit Documentation and 500 Audit Evidence.

The 2nd Respondent was in breach of HKSA 220 Quality Control for an Audit of Financial Statements.

 

In addition, the 1st and 2nd Respondents were in breach in the Fundamental Principle of Professional Competence and Due Care in sections 100 and 130 of the Code of Ethics for Professional Accountants.

Order:
All three respondents:
Reprimand


Penalty:
1st & 2nd Respondents
HK$12,000


3rd Respondent
HK$50,000

 

Cost:
HK$83,215.6


Extract of Resons and Order

18 December 2015

1) Cheng Chi Pang
2) Leslie Cheng & Co.
(ENG)

(CHI)

Failure or neglect to observe, maintain or otherwise apply professional standards issued by the Institute.

 

The 1st Respondent was in breach of  HKSA 220 and paragraphs 100.4 and 130.1 of the Code of Ethics for Professional Accountants

 

The 2nd Respondent was in breach of a number of auditing standards.

 

Order:
All two respondents:
Reprimand


Penalty:
1st Respondents
HK$100,000
2nd Respondent
HK$200,000

 

Cost:
1st Respondents
HK$10,250


All two respondents

HK$280,788.7

 

Extract of Resons and Order

4 December 2015

Poon Ming Pui
(ENG)

(CHI)

Conducting himself in a manner inconsistent with the good reputation of a professional accountant in breach of Statement 1.200 which applied up to June 2006, and failure or neglect to observe, maintain or otherwise apply Fundamental Principle of Integrity in sections 100 and 110 of the Code of Ethics for Professional Accountants which applied from July 2006.


The Respondent made several materially false or misleading declarations to his employers in which he failed to disclose securities trading activities he carried out through two of his friends' securities accounts.  The Securities and Futures Commission took disciplinary action against the Respondent, banning him from re-entering the securities industry for 10 months from January 2014.

Order:
Removal from the register of CPAs for 1 year with effect from 18 January 2016


Penalty:
HK$10,000

 

Cost:
HK$21,947


Extract of Reasons and Order

28 October 2015

1) Lo Shung Chi

2) Ngai Wai Chung

3) Jonten Hopkins CPA Ltd.

(ENG)

(CHI)

The 3rd Respondent failed or neglected to observe, maintain or otherwise apply a number of auditing standards in the audit of a Hong Kong listed company.

All three respondents were in breach of the fundamental principle of "Professional Competence and Due Care" in section 100 and 130 of the Code of Ethics for Professional Accountants; and

The 1st and 3rd Respondents were guilty of professional misconduct.

Order:

1st Respondent
Cancellation of his practising certificate  and no practising certificate shall be issued to him for one year.


2nd & 3rd Respondents.

Reprimand

 

Penalty:

1st Respondent

HK$100,000

2nd Respondent

HK$40,000

3rd Respondent

HK$80,000

 

Costs:

HK$32,500

 

Order 

Reasons for Decision

 

 

11 September 201534(1)(a)(v)Failure or neglect to observe a direction issued by the Practice Review Committee under section 32F(2) of the Professional Accountants Ordinance.

To cooperate with the Institute to complete a practice review on his practice. Payments of penalty and costs of totaling HK$283,468.


Extract of Resons and Order

21 September 201534(1)(a)(vi)Failure or neglect to observe, maintain or otherwise apply namely paragraph 10, 11, 12 and /or 17 of Hong Kong Standard of Auditing 700. The Respondent failed to obtain sufficient appropriate audit evidence to conclude that the financial statements as a whole are free from the material misstatement.

Reprimand and payment of penalty and costs of totaling HK$69,473.

 

Extract of Reasons and Order

18 September 201534(1)(a)(vi)Failure or neglect to observe, maintain or otherwise apply multiple professional standards as provided in the Code of Ethics for Professional Accountants 110.1, 110.2, 290.4, 290.6 and 290.134; Hong Kong Standards on Auditing 220,300,315,500 and 705; Hong Kong Accounting Standard 37. The Respondent was guilty of serious professional misconduct covering audit deficiencies, ethical requirements, policies and procedures and quality control.

Reprimand and payments of penalty and costs totaling HK$78,696


Extract of Reasons and Order

11 September 2015

Chow Ho Tung, Anthony

(ENG)

(CHI)

Guilty of dishonourable conduct. Chow was convicted of 9 charges involving conspiracy to steal, conspiracy to defraud, and publishing a false statement in a company's annual report. The District Court sentenced Chow to imprisonment for 5 years and 4 months.

Order:
Permanent removal from the register of CPAs with effect from 22 October 2015.


Penalty:

N/A


Cost:
HK$24,066


Exact of Reasons and Order

10 September 201534(1)(a)(vi)Failure or neglect to observe, maintain or otherwise apply namely paragraph 100.4(e) of the Code of Ethics for Professional Accountants (effective on 30 June 2006) ('the Code') and elaborated in section 150 Code, as evidenced by their breach of their director's undertaking for failure to use their best endeavours to procure the Company's compliance with the Listing Rules. 

Reprimand and payments of penalty and costs of totaling HK$82,000.


Decision on Costs

Reasons for Decision
 

26 August 201534(1)(a)(vi)Failure or neglect to observe, maintain or otherwise apply a professional standard, namely Hong Kong Standard on Auditing 500 Audit Evidence. The Respondent failed to obtain sufficient appropriate audit evidence in respect of cash and cash equivalents in the financial statements. As a result, the balance was materially overstated.

Reprimand and payments of penalty and costs of totaling HK$36,118.


Extract of Reasons and Order

19 August 201534(1AAA)Failure or neglect to observe, maintain or otherwise apply sections 100.5, 110 and 150 of the Code of Ethics for Professional Accountants. The Respondent breached of the fundamental principle of integrity by misrepresenting professional and academic qualifications and other credentials in internet social media.

Reprimand and payments of penalty and costs of totaling HK$47,436

 

Extract of Reasons and Order

13 July 2015

LEUNG, Kent Ning, Louis

(ENG)

(CHI)

Failure or neglect to observe, maintain or otherwise apply paragraphs 290.4 and 290.6 of the Code of Ethics for Professional Accountants. The Respondent  was the engagement director of a corporate practice which issued the auditor's report of a private company for the period when he had been appointed and acted as the Chief Financial Officer of the company.

Order:
Cancellation of practising certificates issued to the Respondent in 2015
and the same shall not be issued to him for year 2016


Penalty:
HK$100,000


Cost:
HK$100,000

 

Extract of Resons and Order

22 May 2015

34(1)(a)(vi)

34(1A)

Failure or neglect to observe, maintain or otherwise apply: Hong Kong Standard on Auditing ("HKSA") 500 Audit Evidence, HKSA 200 Objective and General Principles Governing an Audit of Financial Statements, HKSA 315 Understanding the Entity and Its Environment and Assessing the Risks of Material Misstatements, and HKSA 700 The Independent Auditor's Report on a Complete Set of General Purpose Financial Statements.
The respondents failed to comply with auditing standards in their work carried out on the recognition and valuation of mining and exploration rights acquired by a listed company for the years ended 31 December 2008 and 2009.

Reprimand and payments of penalty and costs of totaling HK$211,351.4


Penalty:
HK$100,000 for each respondent


Cost:
Costs of HKICPA and FRC
HK$113,351.40

 

Extract of Reasons and Order

 

10 April 201534(1)(a)(vi)

Failure or neglect to observe, maintain or otherwise apply:

 

(a) Statement of Auditing Standards ("SAS") 400 "Audit Evidence", SAS 230 "Documentation" and SAS 200 "Audit Planning" applying in 1998 and 1999 and the corresponding standards applying in 1997 in the audit of the consolidated financial statements of a company formerly listed in Hong Kong.

 

(b) Professional Ethics Statement 1.200 in that the respondents failed to carry out professional work with a proper regard to technical and professional standards.

Reprimand and payments of penalty and costs of totaling HK$1,751,071.

  

Extract of Reasons and Order

 

10 March 201534(1)(a)(vi)Failure or neglect to observe, maintain or otherwise apply sections 100.5 and 110 “Integrity” of the Code of Ethics for Professional Accountants.  The Respondent falsely claimed, on a number of public occasions, that he held a Master degree in Professional Accounting when he was only a student of that programme at the relevant time.

Reprimand and payments of penalty and costs of totaling HK$74,265.

  

Extract of Reasons and Order
6 March 2015

Yeung Chai On, Paul

(ENG)

(CHI)

Failure or neglect to observe, maintain or otherwise apply sections 100.4/5(a) and 110 “Integrity” of the Code of Ethics for Professional Accountants.  The Respondent failed to be straight- forward and honest in his dealings with the HKICPA Trust Fund.

Order:
Removal from the register of CPAs for 6 months with effect from 1 May 2015

Penalty:

N/A

 

Cost:

HK$31,829.70

 

Extract of Reasons and Order

22 January 201534(1)(a)(vi)Failure or neglect to observe, maintain or otherwise apply sections 100.4(a) and 110 “Integrity” of the Code of Ethics for Professional Accountants and guilty of dishonourable conduct.  The Respondent was senior manager of a CPA firm and signed auditor’s reports in the name the firm without its knowledge and authority.

Removal from the register of CPAs for 12 months .

Payment of penalty and costs of totaling HK$50,499.

 

Extract of Reasons and Order

16 January 201534(1)(a)(x)Guilty of dishonourable conduct.  The Respondent was convicted in the Magistrate's Court of six charges of indecent assault.

Removal from the register of CPAs for 9 months.

Payments of costs HK$47,324 

 

Extract of Reasons and Order

8 January 2015

34(1)(a)(vi)

 

1st and 3rd Respondent:
Failure or neglect to observe, maintain or otherwise apply paragraphs 100.4(c) and 130.1 "Professional Competence and Due Care" of the Code of Ethics for Professional Accountants in the audit of the financial statements of a Hong Kong listed company.

 

2nd Respondent:
Failure or neglect to observe, maintain or otherwise apply Hong Kong Standard on Auditing 220 "Quality Control for an Audit of Financial Statements" as engagement quality control reviewer of the audit.

 

All three Respondents:
Guilty of professional misconduct in performing the audit.

Order:
1st and 2nd Respondents
Cancellation of practising certificates with effect from 17 February 2015 and the same shall not be issued to them for 24 months.

 

3rd Respondent
Reprimand

 

Penalty:

N/A

 

Costs:

HKICPA
HK$20,840

 

FRC
HK$226,234.60

 

Extract of Reasons and Order

6 January 201534(1)(a)(vi)Failure or neglect to observe, maintain or otherwise apply Hong Kong Standard on Auditing 230 "Audit Documentation" in the audits of the financial statements of a listed company in Hong Kong for the years ended 31 December 2008.
The respondents failed to prepare audit documentation that provides a sufficient and appropriate record of the objective analysis undertaken to support the basis of their concurrence with the listed company's accounting treatment of the impairment losses recorded in the investment revaluation reserves.

Reprimand and payments of penalty and costs of totaling HK$164,694.8

 

Extract of Reasons and Order
12 December 201434(1)(a)(vi)

Failure or neglect to observe, maintain or otherwise apply sections 100.5 and 130 "Professional Competence and Due Care" of the Code of Ethics for Professional Accountants and guilty of professional misconduct.   The Respondent's practice was selected for practice review.  Subsequent follow up practice review visit identified deficiencies in the Respondent's audits of two clients.

Cancellation of practising certificate with effect from 2 February 2015 and the same shall not be issued to him for 10 months.

Payments of costs totaling HK$25,376

 

Extract of Reasons and Order

12 December 2014

34(1)(a)(vi)

Failure or neglect to observe, maintain or otherwise apply section 110 "Integrity" and section 120 "Objectivity" of the Code of Ethics for Professional Accountants and Hong Kong Standard on Auditing 550 "Related Parties".  Respondent wrongfully acceded to client's request to issue an unmodified audit opinion on financial statements known to contain a material error, and failed to evaluate whether certain related-party transactions were appropriately disclosed in the financial statements.

Removal from the register of CPAs for 10 months and Reprimand.

Payments of penalty and costs totaling HK$49,840

 

Extract of Reasons and Order

21 November 2014

34(1)(a)(vi)

Failure or neglect to observe, maintain or otherwise apply HKSQC 1, HKSA 230, and HKSAE 3000.  The Respondent's practice was selected for practice review.  Subsequent follow up practice review visits indicated that the Practice continued to fail to take appropriate actions in response to the quality control deficiencies identified during practice reviews which include the failure to implement an adequate monitoring function.  In addition, the practice review also identified a number of deficiencies in the Practice's audits and assurance engagements of two clients.

Cancellation of practising certificates issued  with effect from 31 December 2014 and the same shall not be issued to him for year 2015.

Payments of penalty and costs totaling HK$48,073.

 

Extract of Reasons and Order

17 November 2014

34(1)(a)(vi)

34(1AA)

1st Respondent:
Failure or neglect to observe, maintain or otherwise apply the Fundamental Principles set out in the then applicable paragraph 100.4(c) and as elaborated in paragraph 130.1 "Professional Competence and Due Care" of the Code of Ethics for Professional Accountants ("Code") for failure to act diligently in accordance with professional standards when carrying out the work, as an engagement director, on the unaudited pro forma financial information of a group of companies ("Unaudited PFI") contained in a circular issued by a listed company in Hong Kong for the purpose of a substantial acquisition and the audit of the financial statements of the listed company for the year ended 30 June 2010 ("2010 Financial Statements").

 

2nd Respondent:
Failure or neglect to observe, maintain or otherwise apply (i) Hong Kong Standard on Auditing ("HKSA") 220 "Quality Control for an Audit of Financial Statements"; and (ii) the Fundamental Principles set out in the then applicable paragraph 100.4(c) and as elaborated in paragraph 130.1 "Professional Competence and Due Care" of the Code for failure to act diligently and in accordance with professional standards when carrying out the work, as an engagement quality control reviewer, in the 2010 Financial Statements.

 

 

3rd Respondent:
Failure or neglect to observe, maintain or otherwise apply any one or all of the following professional standards when carrying out the work on the Unaudited PFI and 2010 Financial Statements:
(i) Hong Kong Standard on Investment Circular Reporting Engagements 300 "Accountants' Reports on Pro Forma Financial Information in Investment Circulars";
(ii) HKSA 200 "Objectives and General Principles Governing an Audit of Financial Statements";
(iii) HKSA 230 "Audit Documentation";
(iv) HKSA 500 "Audit Evidence";
(v) HKSA 545 "Auditing Fair Value Measurements and Disclosures";
(vi) HKSA 620 "Using the Work of an Expert"; and/or
(vii) HKSA 700 "The Independent Auditor's Report on a Complete Set of General Purpose Financial Statements".

Reprimand and payments of penalty and costs of totaling HK$108,673.2

 

Extract of Reasons and Order

3 November 201434(1)(a)(vi)Failure or neglect to observe, maintain or otherwise apply section 150 "Professional Behavior" and section 450 "Practice Promotion" of the Code of Ethics for Professional Accountants by allowing an unregistered company sending out unsolicited promotional emails and holding itself out as providing audit services.

Reprimand and payments of penalty and costs of totaling HK$23,765

 

Extract of Reasons and Order

30 October 2014

34(1)(a)(vi)

34(1)(a)(viii)

Failure or neglect to observe, maintain or otherwise apply the then applicable Statement 1.200 "Professional Ethics – Explanatory Forward", Statement 1.290C "Professional Ethics – Unlawful Acts or Defaults By or On Behalf of a Member's Employer" and Statement 1.291 "Professional Ethics – The Ethical Responsibilities of Members in Business".  The Respondent was an accounting manager of a listed company in Hong Kong.  She failed to report her employer's unlawful acts to an appropriate level of management or to the relevant third party authorities.  She was also aware that the information provided to the auditors of a listed company was either misrepresented or false and she did not do anything to rectify the situation

Removal from the register of CPAs for 24 months.

Payments of costs of HK$20,352.

 

Extract of Reasons and Order

27 October 2014

34(1)(a)(x)

Guilty of dishonourable conduct.  The Respondent was convicted in the Magistrate's Court of one count of indecent assault and one count of loitering causing concern.

Removal from the register of CPAs for 6 months and payments of costs of HK$19,207

 

Extract of Reasons and Order

26 September 201434(1)(a)(vi)Failure or neglect to observe, maintain or otherwise apply Hong Kong Standard on Investment Circular Reporting Engagements 300 – "Accountants' Reports on Pro Forma Financial Information in Investment Circulars" in expressing an unqualified opinion in their report on the unaudited pro forma financial information of a group of companies ("Unaudited PFI") as a result of having failed to identify that the listed company had not applied its deferred taxation accounting policy consistently in the pro forma adjustments in the Unaudited PFI.

Reprimand and payments of penalty and costs of totaling HK$55,080

Extract of Reasons and Order

11 September 2014

34(1)(a)(vi)

 

Failure or neglect to observe, maintain or otherwise apply section 130 "Professional Competence and Due Care" of the Code of Ethics for Professional Accountants for the Respondents' failure to act diligently in accordance with Hong Kong Accounting Standard 16 "Property, Plant and Equipment" in the audit of the financial statements of a listed company.

Reprimand and payments of penalty and costs of totaling HK$73,273.4

 

Extract of Reasons and Order

11 September 2014

34(1)(a)(vi)

Failure or neglect to observe, maintain or otherwise apply Hong Kong Standard on Auditing 700 "Forming an Opinion and Reporting on Financial Statements" for the Respondent's failure to express a modified auditor's opinion in respect of a listed company's non-compliance with Hong Kong Accounting Standard 16 "Property, Plant and Equipment"for two years.

Rerpimand and payments of penalty and costs of totaling 93,157.4

 

Extract of Reasons and Order

26 August 201434(1)(a)(x)Guilty of dishonourable conduct.  Cheng was convicted in the Magistrate's Court of one charge of an attempted indecent assault and one charge of indecent assault.

Removal from the register of CPAs for six months and payments of costs of HK$14,965.

 

Extract of Reasons and Order

15 August 2014

34(1)(a)(vi)

Failure or neglect to observe, maintain or otherwise apply paragraphs 100.5(e) and 150.1 "Professional Behavior" of the Code of Ethics for Professional Accountants for the Respondent's failure to comply with relevant laws and regulations and avoid any action that discredits the profession when he took and duplicated the apartment keys of a colleague and attempted to gain entry into that apartment.

Reprimand and payments of penalty and costs of totaling HK$34,681

 

Extract of Reasons and Order

22 July 201434(1)(a)Failure or neglect to observe, maintain or otherwise apply Statement 1.203 "Professional Ethics – Integrity, Objectivity and Independence".

Guilty of professional misconduct as a result of his failure to observe, maintain or otherwise apply the independence requirements of the Institute, namely Statements of Professional Ethics 1.200 "Professional Ethics – Explanatory Foreword" and Statement 1.203 "Professional Ethics – Integrity, Objectivity and Independence".

Reprimand for the 1st and 2nd Respondents.

The name of 3rd Respondent be removed from the register of CPAs for 2 years .

Payments of penalty and costs of totaling HK$ 2,500,000

 

Determination 

 

21 July 201434(1)(a)(vi)Failure or neglect to observe, maintain or otherwise apply section 100.4(e) of the Code of Ethics for Professional Accountants, as a result of the Respondent's being convicted for unlawful short selling of shares of a listed company contrary to the Securities and Futures Ordinance.

Reprimand and payment of penalty totaling HK$26,708


Extract of Reasons and Order

21 July 201434(1)(a)(vi)Failure or neglect to observe, maintain or otherwise apply section 100.4(e) of the Code of Ethics for Professional Accountants, as a result of the Respondent's being convicted for unlawful short selling of shares of a listed company contrary to the Securities and Futures Ordinance.

Reprimand and payments of penalty totaling HK$55,834

 

Extract of Reasons and Order

17 June 2014

34(1)(a)(vi)

Failure or neglect to observe, maintain or otherwise apply Statement of Auditing Standards 230 "Documentation" in their audit of a listed company's 2002 financial statements.  The Respondents did not document the procedures adopted for maintaining control over the external confirmation exercise and for reaching an audit conclusion regarding the existence and valuation of the deferred development cost of a project amounting to HK$40,857,000.

Reprimand and payments of penalty and costs totaling  HK$635,000

 

Extract of Reasons and Order

24 March 2014

34(1)(a)(vi)

Failure or neglect to observe, maintain or otherwise apply the Fundamental Principles of "Professional Competence and Due Care" set out in sections 100.5 and 130 of the Code of Ethics for Professional Accountants, and "Professional Behavior" set out in sections 100.5 and 150 of the Code.  The respondents' failed to comply with certain provisions of the Companies Ordinance and the Companies (Winding-up) Rules in conducting a liquidation and were removed by the Court as liquidators.

Order:

Cancellation of practising certificates issued to the respondents and the same shall not be issued to them for 12 months.

 

Penalty:

HK$50,000 for each Respondent

 

Cost:

HK$23,441

 

Extract of Reasons and Order

 

18 March 2014

34(1)(a)(vi)

Failure or neglect to observe, maintain or otherwise apply section 130.1 of the Code of Ethics for Professional Accountants and Hong Kong Accounting Standard 33 "Earnings per Share".  The respondents had calculated or concurred with wrong amounts of earnings per share disclosed in the accountants' report and audited financial statements of a Hong Kong listed company.

Reprimand and payments of penalty and costs totaling HK$80,000

 

Extract of Reasons and Order

27 January 2014

34(1)(a)(vi)

Failure or neglect to observe, maintain or otherwise apply Hong Kong Standard on Auditing 250 "Consideration of Laws and Regulations in an Audit of Financial Statements" and Hong Kong Standard on Auditing 500 "Audit Evidence".

Reprimand and payments of costs totaling HK$25,887

 

Extract of Reasons and Order

 

8 January 2014

34(1)(a)(ix)

34(1AA)

Refusal or neglect to comply with rule 7 of the Corporate Practices (Registration) Rules by allowing audit reports issued by the corporate practice to be signed by persons who were not directors of the corporate practice and practising members.

The corporate practice was reprimanded; and the name of the CPA was removed from the register of CPAs for 30 months. 

Payments of costs HK$81,893

 

Extract of Reasons and Order

7 January 2014

34(1)(a)(vi)

34(1)(a)(iii)(B)

34(1)(a)(viii)

 

Failure or neglect to observe, maintain or otherwise apply the Fundamental Principles of "Professional Competence and Due Care" set out in section 100 "Introduction and Fundamental Principles", section 110 "Integrity" and section 130 "Professional Competence and Due Care" of the Code of Ethics for Professional Accountants.

 

Made statements which were material and which he knew to be false or did not believe to be true.

 

Guilty of professional misconduct due to the above non-compliances.

Reprimand and payments of penalty and costs totaling HK$64,980

 

Extract of Reasons and Order

 

5 December 201334(1)(a)(ii)

Conviction by the Magistrate's Court of offences involving dishonesty. The Respondent obtained merchandise and money from a toy shop by acts of deception.

Removal from the register of CPAs for six months and payment of costs of HK$20,200.

 

Extract of Reasons and Order

27 November 201334(1)(a)(x)

Guilty of dishonourable conduct. The Respondent was convicted of 20 charges of "Behaving in a Disorderly Manner in a Public Place".  He had taken improper photos of unknown females in public places.

Removal from the register of CPAs for 12 months and payment of costs of HK$19,976.

 

Extract of Reasons and Order

22 November 201334(1)(a)(vi)

Failure or neglect to observe, maintain or otherwise apply section 100 "Introduction and Fundamental Principles" and section 130 "Professional Competence and Due Care" of the Code of Ethics for Professional Accountants.

Reprimanded and payment of penalty and costs totaling HK$60,879.

 

Extract of Reasons and Order

19 November 201334(1)(a)(vi)

Failure or neglect to observe, maintain or otherwise apply the Fundamental Principles of "Professional Competence and Due Care" and "Professional Behaviour" set out in section 100 "Introduction and Fundamental Principles" of the Code of Ethics for Professional Accountants.

Reprimanded and payment of costs of HK$21,466.

 

Extract of Reasons and Order

11 November 201334(1)(a)(vi)

Failure or neglect to observe, maintain or otherwise apply section 450 "Practice Promotion" of the Code of Ethics for Professional Accountants.

Reprimanded and payment of costs of HK$23,481.

 

Extract of Reasons and Order

29 October 201334(1)(a)(vi)

Failure or neglect to observe, maintain or otherwise apply Hong Kong Standard on Auditing 230 "Audit Documentation" and Hong Kong Standard on Quality Control 1 "Quality Control for Firms That Perform Audits and Reviews of Historical Financial Information, and Other Assurance and Related Services Engagements".

Reprimanded and payment of penalty and costs totaling HK$79,750.

 

Extract of Reasons and Order

28 October 201334(1)(a)(vi)

Failure or neglect to observe, maintain or otherwise apply Hong Kong Standard on Auditing 230 "Audit Documentation".

Reprimanded and payment of penalty and costs totaling HK$279,986.60.

 

Extract of Reasons and Order

10 October 201334(1)(a)(vi)

Failure or neglect to observe, maintain or otherwise apply section 130 "Professional Competence and Due Care" of the Code of Ethics for Professional Accountants.

The corporate practice was reprimanded and the CPA be removed from the register of CPAs for 18 months with effect from 18 November 2013.
The respondents were also ordered to pay costs of HK$162,265.40.

 

Extract of Reasons and Order

3 October 201334(1)(a)(vi)

Failure or neglect to observe, maintain or otherwise apply section 100 "Introduction and Fundamental Principles", section 110 "Integrity" and section 130 "Professional Competence and Due Care" of the Code of Ethics for Professional Accountants.

Reprimanded and payment of penalty and costs totaling HK$81,532.

 

Extract of Reasons and Order

2 October 2013

Yip Tze Wai, Andy

(ENG)

(CHI)

Guilty of dishonourable conduct. The Respondent was convicted of an offence under the Organized and Serious Crime Ordinance (Cap.455) in that he has dealt with property known or reasonably believed to represent the proceeds of an indictable offence. The Respondent was sentenced to imprisonment for 2 years and 9 months.

Order:

Removal from the register of CPAs for 4 years.

 

Penalty:

N/A

 

Cost:

HK$78,116

 

Extract of Reasons and Order

29 August 201334(1)(a)(vi)

Failure or neglect to observe, maintain or otherwise apply section 100 "Introduction and Fundamental Principles" and section 130 "Professional Competence and Due Care" of the Code of Ethics for Professional Accountants. 

Reprimanded and payment of penalties and costs totalling HK$1,150,000.

 

Extract of Reasons and Order

12 August 201334(1)(a)(ix)

Refusal or neglect to comply with a direction given by the Council pursuant to section 18B of the Professional Accountants Ordinance.

Removal for 6 months with effect from 13 September 2013, and payment of penalty and costs totaling HK$158,116.

 

Extract of Reasons and Order

23 July 201334(1)(a)(vi)

Failure or neglect to observe, maintain or otherwise apply section 100 "Introduction and Fundamental Principles" and section 150 "Professional Behaviour" of the Code of Ethics for Professional Accountants.

Reprimanded and payment of penalties and costs totaling HK$31,607.

Extract of Reasons and Order

25 June 201334(1)(a)(vi)

Failure or neglect to observe, maintain or otherwise apply section 150 Professional Behavior of the Code of Ethics for Professional Accountants.

Reprimanded and payment of costs totaling HK$23,727.

 

Extract of Reasons and Order

 

Extract of Reasons and Order