Audit Firm, Audit Partner Fined For Breach Of Partner Rotation Requirement

KUALA LUMPUR, Aug 27 (Bernama) -- The Securities Commission Malaysia (SC) Audit Oversight Board (AOB) has imposed fines of RM150,000 and RM37,500 on Grant Thornton Malaysia PLT (GTM) and its audit partner, Mohamad Heizrin Sukiman, respectively, for failing to comply with key audit partner rotation requirement.

SC said Mohamad Heizrin had breached the key requirement of the Malaysian Institute of Accountants’ By-Laws on Professional Ethics, Conduct and Practice (MIA By-Laws) during the transition period of the revised MIA By-Laws.

“Mohamad Heizrin was an engagement partner and engagement quality reviewer on the audit of a public interest entity (PIE) from 2013 to 2017, after which he was required to serve a minimum cooling-off period of three consecutive years.

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“But he failed to do so, and as a result, was involved in the audit of the PIE for more than seven years,” the SC said in a statement today.

It said the MIA By-Laws stipulate that an audit engagement partner shall not be involved in an audit engagement for a cumulative period of more than seven years to ensure audit independence.

“The AOB views the breach seriously as auditors’ independence and compliance with ethical standards are fundamental requirements for the audit profession,” it said.

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SC said GTM failed to meet the quality objectives of the International Standards of Quality Management (ISQM) 1 as adopted by the MIA, specifically on non-compliance with relevant ethical requirements, including those related to independence.

Both GTM and Mohamad Heizrin had appealed to the SC against the AOB’s enforcement action.

“The SC heard the appeal and after due process, affirmed the AOB’s decision,” it added.

-- BERNAMA