By Timothy Knight,2014-05-19 00:36
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Chairman and Members of the NBAA Governing Board,

    World Bank Officials,

    NBAA Acting Executive Director,

    Consultants to the Project,

    Distinguished Guests,

    Ladies and Gentlemen,

1. It is an honour and great pleasure to be given this opportunity to

    officiate this historical workshop on “updating the accounting and auditing legislation in Tanzania.” Since this is my first audience with members and stakeholders of the accounting profession in

    Tanzania this year, may I on behalf of the Minister of Finance and on


    my own behalf congratulate, Mr. Ludovick S.L. Utouh for his presidential appointment as the new Controller and Auditor General of the United Republic of Tanzania. He is your true product of the profession and through his leadership, we shall, with your support carry the ongoing financial reforms in Tanzania.

    May I also congratulate all members of the accounting profession who were elected new Members of Parliament in the fourth Phase Government under the leadership of H.E. President Jakaya Mrisho Kikwete.

    We wish all those elected and appointed good health and success in their new careers.

    Mr. Chairman, today’s forum is one of the products of the

    ongoing financial reforms in the country, which is being accomplished by the Government of the United Republic of Tanzania and, assisted by our development partners like the World Bank. The project is on updating the accounting and auditing legislation in Tanzania.


    Mr. Chairman, a similar forum was held in March 2006 and the focus was on a World Bank and International Monetary Fund “Report

    on Observance of Standards and Codes (ROSC)“ study aimed at

    strengthening the corporate financial reporting regime in the country.

    Chairman, the World Bank ROSC Study revealed that the National Board of Accountants and Auditors (NBAA) has made a

    significant contribution to accounting development of the accounting

    profession over the past decade through its examination processes,

    professional education programmes and usage of International

    Accounting and Auditing Standards. However, among the constraints

    is the lack of learning materials on these international standards.

    Another problem which was identified by the Study was that NBAA is unable to

    function effectively both as a regulator and a professional body. This is due to the

    composition of the Governing Board, whose membership does not allow for adequate

    regulatory public oversight by non-accountants. Additionally, there is lack of capacity to

    undertake monitoring activities in order to ensure compliance with accounting and

    auditing standards by the Practitioners.

    Furthermore, it was observed that in some cases the accounting and disclosure

    requirements set by other legislations like the Bank and Financial Institutions Act,

    Insurance Act, Capital Market and Securities Act and Companies Act are incompatible

    with the International Financial Reporting Standards requirements.


    Mr. Chairman, as stated above, the ROSC Report is based on a review of

    strengths and weaknesses of existing institutional framework that underpin financial

    accounting and auditing practices, the actual practices, as well as an analysis of the

    effectiveness of monitoring and enforcement mechanism. Various weaknesses and

    encouraging advancements were revealed in the study. The challenge, now facing both

    the Government and NBAA, is to work on the weaknesses identified in order to come up

    with improvements in the financial reporting regime in the country.

    Mr. Chairman, one thing, which the profession should take into consideration,

    which is also the Government headache, is the introduction of an oversight body, which

    is a major recommendation in the ROSC report. The World Bank thinks that this is in

    line with the global trend towards accountancy bodies being more open in their

    governance and regulatory processes and towards more independent oversight or

    regulation in areas of public interest.

The oversight (regulatory) body among other things shall be responsible for adoption,

    monitoring, and enforcement of accounting and auditing standards based on financial

    reporting of Public Interest Entities (PIE).

    Mr. Chairman, may I emphasize again that, a financial reporting system

    supported by strong governance, high quality standards and sound regulatory

    frameworks is key to our economic development. Indeed, high quality standards in

    financial reporting, auditing and ethics underpin the trust that investors place in financial

    and non-financial information and, go a long way in contributing to a country’s economic

    growth and financial stability.

    Mr. Chairman, we must also agree that as forces of globalisation prompt more

    and more countries to open their doors to foreign investments and as businesses

    themselves expand across borders, both the public and private sectors are increasingly

    recognizing the benefits of having a commonly understood financial reporting framework

    supported by strong globally accepted auditing standards. If we need to have enhanced

    sustainable economic growth, we must comply with requirements set by these



    Mr. Chairman, the Project on “updating of accounting and auditing standards legislation in Tanzania” by the World Bank commissioned consultants Emerging

    Markets Group [ EMG] is one of the Government’s attempts to solve the above

    problems in order to strengthen our financial architecture in crisis prevention mitigation

    and resolution.

    The EMG Consultants have researched, consulted a number of key stakeholders

    and come up with the following proposals for our deliberations and recommendations to

    the government:

    (a) Update the current legal framework for accounting and auditing in


    (b) Restructure the NBAA so as to be a public oversight (regulatory) body to

    monitor compliance by auditors and accountants with international

    standards as they apply to public interest entities.

    (c) Develop a strong independent professional institute for accountants and


    Mr. Chairman, the sooner this goal is achieved, the better will be the financial

    and economic environment needed to compete in today’s global economy. On this

    score may I sincerely express my appreciation to the World Bank, Consultants and the

    NBAA for their timely organisation of this stakeholders workshop aimed at coming up

    with concrete and workable recommendations. Please feel at ease and get prepared to

    contribute intellectually and if necessary provocatively.

    Mr. Chairman, since I see you have a very busy programme to discuss issues

    concerning updating of the current legal framework for accounting and auditing in

    Tanzania, restructuring of NBAA and establishing accountancy institute, I would like to

    end my opening remarks by wishing you very fruitful deliberations. May I thank you for

    your attention and I now declare this Workshop officially opened.

    Thank you!



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