COMPANIES' AUDITS.

Dominion, Volume 3, Issue 867, 13 July 1910, Page 2

COMPANIES' AUDITS.

MEETINC OF ACCOUNTANTS. RESTRICTION OPPOSED. A meeting of registered accountants was held in tho Chamber of Commerce last evening. Mr. A. Leigh Hunt, the convener, was voted to the chair. There were 17 present. The chairman mentioned that it had been hoped that Mr. J. H. Holliwell would have been present and would have presided. Though unable to do so he had expressed full" sympathy with the object of the meeting.

The chairman reminded those present that draft Regulation 67d under the Companies Act (providing that only public accountants shall audit the accounts of companies) was struck out at a meeting of the New Zealand Society of, Accountants, but tho council of tho society afterwards aske.d the Government to amend the Act so as to effect the same object as that of Regulation 67d, although a letter of protest was sent to the council in tho matter. He believed that the public should have some; protection in tho matter of auditing, though he did not approve o£ the proposal of the council. He moved: That it is desirable that an

amendment to tie Companies Act,

1908, be niado to provide that any

member of the New Zealand Society of Accountants shall be eligi-

)le, and that no person other than

a member of the said society shal be eligible to perform the audi of, or accept the position of audito: to any company registered unde the_ said Act (excepting such as ar registered as private companies) o under any other Act of Parliamen for'the time being in force whicl provides for the audit of the accounts of any corporation, company, or public body, and that the council be requested to take all neces-

sary steps to.ensure the passing of

the above amendment at as early a da to as possible. "

If audits were confined to public accountants, continued Mr. Hunt, there; would be heavy expense to small companies in country towns and elsewherej where there was no public accountant in residence. Tfie National Dairy Association had lodged its protest against the council's scheme, and so had the mining companies in Otago. Similar expressions had come from other quarters,- and accountants generally were waiting for Wellington to givo them alead. The public accountants and the' registered accountants (who were much more numerous) were of equal status in tho society, and the difference was that, the latter were for the most part employed by different firms, while the former were in business for themselves. The proposal of Regulation 67d would result in taking away a considerable part of the income of some of the registered accountants in - country, places, and would block registered, accountants in tho endeavour to gradually become public accountants. ,It appeared to be an attempt by the public accountants to get by regulation what they could not get by legislatiin, and tho result was likely to be a split in tie Society of Accountants.

Mr. T. Forsyth seconded the motion. Ho remarked that any registered accountant could turn himself into a public accountant by giving 24 hours' notice and putting up a brass plate. Yet the public accountants were prating about' protection to the public. Mr. W. Jack, in supporting the motion, said: the object was to have the matter fully considered by the society,' and decided at the annual meeting next' month. The proposed restriction topublic accountants might injure the public accountants themselves by driving registered accountants to : become public accountants. The council had done very good work, and.the present movement was not meant to be antagonistic to the council.

Mr. R. W. Nelson said there was something to be said on the other side. The registered accountant had his position, and could • compete on unfair terms with the public accountant, whohad an office to keep up. ,It was to the advantage of public companies to have their, audits performed by public accountants, who were permanently settled in a place, whereas the registered accountant might be here to-day and gone to-morrow. ; the chairman said 67d was the only blot on the regulatious, which- were in other respects excellent; and gratitude was due to the council for the excellent work they had done. ''

3fr. J. M.- Fleming said that he had found, when in Dunedin lately, that the commercial accountants there strongly disapproved of the. action of the council in this matter. The proposal of the council meant taking away a valuable right from the registered accountants, ■ who could use it, as many of the present public accountants''had done, to get up the nucleus-of a practice of their own. Another result would bo to lower the status of the registered - accountant in the' public eye. No member of the society would enter into unfair competition with the public accountant, and if the fees were fixed, the competition would be on the ground of ability. '' ■_. The motion was carried with one dissentient voice.

jlr. Jack moved in favour of abolishing the restriction under which proxies for meetings of the society can- be given only to members of the council or the society of the district represented, unless no such member is available. (Draft Regulation 127.) The motion was seconded by Mr. Gibb and carried.

It was decided to circularise accountants throughout the' Dominion on the questions discussed as above.