ICPAK must stop shifting blame for banks’ collapse

Dr Patrick Ngumi, the Institute of Certified Public Accountants (ICPAK) chief executive officer. PHOTO | KEVIN ODIT 

Imagine hiring a pedigree guard dog and spending a fortune to maintain it.  One day thugs raid your house and clean it up as the dog watches unperturbed. On enquiring why the dog did not even bark at the intruders the dog replies as a matter of factly that its work is not to provide guard services but  to stay in the dog house!

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The dog reminds you that you already have a  guard and fence to protect you. Never mind the fact that the dog has highly sensitive senses of hearing and smell that would have helped pick out intruders from afar.

Listening to the Institute of Certified Public Accountants of Kenya (ICPAK) defend external auditors on the banking industry crises made me question whether the services of external auditors are required if they cannot as much as “bark”! Frankly its better to  have a robot or a village dog on duty.

Sample these comments from  ICPAK: “External auditors are just that -external”, “we don’t prepare accounts”, ‘‘we are not forensic auditors”, “its the board to blame”  “its internal auditors”.

They went ahead to quote their “revered” international auditing  standards. They were not done yet – they embarked on reminding Kenyans  about that “hallowed’’ disclaimer, which never  they fail to highlight on all audited accounts.

The problems Kenyans have with ICPAK is the timing and insensitivity of those denials, coming at a  time billions of shillings of customer deposits  may have been lost , thousands rendered jobless directly or indirectly.

Kenyans have been left scratching their heads in disbelief. Kenyans expected answers from ICPAK and not a string of excuses and scapegoats.

To tell Kenyans “it wasn’t me” is being callous to say the leastExternal auditors have a moral responsibility to employ watertight audit methodology, apply technology to generate trend analysis and exceptions, query variances and obtain credible management responses.

Where in doubt, external auditors can conduct  secondary checks, call in banking industry experts , increase audit sample and extend audit stay at the auditees cost.

The fact remains that ICPAK members were on duty when the three  banks collapsed and must justify the hefty fees Kenyans pay for their services ! Kenyans don’t want textbook answers. They want a reliable assurance  that their hard earned money in banks is safe.

JOE MUSYOKI , via email


The accountants’ regulatory body defended its members who audited the collapsed Dubai, Imperial and Chase banks, shifting blame to management and boards of the lenders.

Auditors make free money. What is their work if they blame directors and managers? It is like a policeman expecting a criminal to report himself.