Incorporation of CPA firms in Singapore

• Main Authors: Chee, Kim Huei, Hoe, Su Hui, Low, Teck Meng
• Other Authors: Tan Khoon Eng
• Format: Final Year Project
• Language: English
• Published: 2015
• Subjects: DRNTU::Business::Auditing
• Online Access: http://hdl.handle.net/10356/62986
• Institution: Nanyang Technological University

Since its formation, the audit profession has prevented its members from practice in corporate form to enhance the professional image. In recent years, some countries have lifted the prohibition and permitted the incorporation of Certified Public Accounting (CPA) firms. However, in Singapore, members of the Institute of Certified Public Accountants of Singapore are still prohibited to be incorporated under the Accountants Act. To date, no study has been conducted in Singapore to determine the effect of incorporation of CPA firms on its professional image and public confidence. Our research attempts to find out the opinions of users of financial statements and determine if public confidence would be affected by the incorporation of CPA firms. A comprehensive search for literature review was conducted to identify the effects of incorporation and determine the factors that influence the level of public confidence in the audit profession. Survey questionnaires were sent out to users of audited financial statements to ascertain their views on the issue of incorporation of CPA firms. Some of the significant findings are that public confidence would be adversely affected if auditors assume limited liability or non-accountants are allowed to own shares in the CPA firms. The respondents of the survey also indicated their most preferred structure of incorporated CPA firms as the one where the auditors assume unlimited liability for their personal negligence and the accountants own all the shares in the CPA firms. We hope that the findings from our research will contribute to the issue of incorporation of CPA firms in Singapore.