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Bank of Ghana to issue “External Auditors Directive” to make sector effective

The Bank of Ghana is set to issue a draft “External Auditors Directive” to help improve the effectiveness of audits in the country and forestall future challenges.

Mr Donatus Freitas, the Chief Manager of the Banking Supervision Department of the Bank of Ghana, said there was growing global problems with auditing and warned accountants to address the issue as a matter of urgency.

Mr Freitas said this in a presentation on ‘Corporate Governance Measures for Ghana’ at a symposium organised by the University of Professional Studies (UPSA) in collaboration with the Institute of Chartered Secretaries and Administrators, Ghana, on Friday.

He said the BoG, in light of global happenings in the audit space, was in the process of issuing the Directive to prevent similar occurrences in Ghana.

The symposium was under the theme: “Towards Deliberate Governance in Ghana: Immediate Considerations”.

Among other things, the Director will seek to ensure that audit firms not only rotate every six years but also rotate partners periodically.

Outlining other proposed measures to enhance corporate governance in Ghana, Mr Freitas said the country must also consider mandating big accounting firms to run joint audits with smaller firms so as to help build their capacity and reduce the risk of firm concentration.

He raised concerns on the lack of a national code on corporate governance noting that various regulators such as the BoG, the Securities and Exchange Commission (SEC) and the Ghana Stock Exchange (GSE) had developed sector-specific corporate governance guidelines, codes or directives.

He stressed the need for harmonised and mandatory national corporate governance code for Ghanaian businesses.

Prof. Albert Puni, the Dean of Distance Learning at UPSA, who spoke on Ghana Corporate Governance Landscape and Framework, said there was the need to revise the Companies Code to make it more responsive to modern challenges.

“We need to really look at this law if we want corporate governance to be what it should be in Ghana,” he said.

He said concentrated ownership in Ghanaian business was a major challenge to corporate governance as majority shareholders could flout corporate governance principles.

He, however, acknowledged that concentrated ownership was working in other parts of the world, an indicator that Ghana was not doing something right.

Prof. Puni urged key institutions in the corporate governance space including the SEC, GSE, and the National Insurance Commission to be more proactive for governance to be what it was supposed to be.

Source: GNA

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