Page 7 - PakistanAccountantOct-Dec2017

President’s Page he repealed Companies Ordinance 1984, which determine legal framework for the corporate sector in Pakistan, was due for revision for a long time, owing to the evolving business environment, impact of technology and globalisation. The Securities and Exchange T Commission of Pakistan (SECP) lead the process for proposing changes in the Company Law after extensive deliberation with various stakeholders, resulting in the eventual promulgation of the Companies Act 2017 (Companies Act) on May 30, 2017. The Companies Act is developed with the objective to facilitate all stakeholders as well as to strengthen the regulatory framework, incorporate new concepts, simplify the requisite provisions and remove the unnecessary regulatory requirements. The changes in the Companies Act impact all major stakeholders across the business cycle from simplifying company business, easing regulations for small companies, focusing on the use of technology, protect investors and creditors interest, to simplified winding up and merger requirements. Due to significance of Islamic Finance, the Companies Act has introduced the concepts of ‘Shariah- compliant company’ and ‘Shariah-compliant security.’ Further, in an increasingly global world, new concepts have been adopted like specie dividend, mediation and reconciliation, complete regime for the valuation of assets, certification of real estate, shifting of jurisdiction to approve the amalgamation of companies, compromises and arrangements from court to the SECP, e-intermediaries for filing the returns of the companies having no IT infrastructure, and removing redundant and unnecessary obligations contained in the repealed Companies Ordinance 1984. The new Companies Act also provides added responsibilities for directors and auditors, requires preparation of the ‘Statement of Compliance’ duly reviewed by auditors, introduces new auditor reporting responsibility and requires auditor’s report to be in compliance with International Standards on Auditing (ISAs) as adopted by The Institute of Chartered Accountants of Pakistan (ICAP). ICAP, in collaboration with the SECP, organised seminars in Karachi, Lahore and Islamabad with an objective to create awareness among members and other professionals about the new Companies Act requirements so that they would be vigilant and keep adjusting to the changing business scenarios to maintain the relevance and effectiveness of their profession. We all hope that new law will facilitate the growth of economy in general and the corporate sector in particular and will ensure better corporate governance and give a boost to corporatisation in the country. Riaz A. Rehman Chamdia, FCA October - December 2017 The Pakistan Accountant 5tober - December 2017 The Pakistan Accountant 5 Oc