Established under part IXC of the SECP Act, 1997 in August 2016
AOB is the independent audit oversight board established by the parliament to function in the public interest and enhance the quality of audit of financial statements of public interest entities. This development is in line with the efforts in other jurisdictions to enhance the audit quality and reliability of financial statements that are a key source of information to investors and other stakeholders.
– to deregister audit firms in the manner laid down in sub-section (2) of section 36T;
– to direct the Institute of Chartered Accountants of Pakistan (ICAP) for making such changes in the quality control review framework as it considers necessary or expedient for the purposes of this Part;
– to ensure that the auditing standards adopted by the Institute conform to the international standards as issued by the International Auditing and Assurance Board;
– to undertake comprehensive review and examination of the QAB work and independently assess the appropriateness of the quality control review framework and take such actions as deemed necessary;
– to oversee and review policies, procedures, programs of QAB for ensuring an effective oversight of quality of audit of public interest companies and to specify any improvement required in QAB’s policies, procedures and systems;
– to conduct inspections and inquiries in respect of matters related to this Part and regulations made hereunder; and
– to coordinate with relevant authorities including SECP, State Bank of Pakistan and ICAP in formulating and implementing strategies for enhancing the reliability of quality and effectiveness of audits of public interest companies.
According to section 36H(i) of SECP Act 1997, a “public interest company” means such company or body corporate as may be notified by the Commission;
On 15 March 2018, in exercise of the powers conferred by section 40B of the Securities and Exchange Commission of Pakistan Act, 1997 (XLII of 1997), read with clause (i) of section 36H thereof, the Securities and Exchange Commission of Pakistan has notified that a “public interest company” shall mean a company which falls under the criteria of “public interest company” as laid down in the Third Schedule to the Companies Act, 2017 (XIX of 2017).
On 03 October 2019, in exercise of the powers conferred by sub-section (2) of section 507 of the Companies Act, 2017 (XIX of 2017), the Securities and Exchange Commission of Pakistan has altered the Third Schedule to the Companies Act, 2017.
Therefore, with effect from 03 October 2019, the following are public interest companies for the purposes of SECP Act 1997:
With effect from 06 July 2020, “all companies engaged in production and sale of sugar” are included in the Third schedule to the Companies Act, 2017.
For Annual Supervision Fee Schedule, click here.
To get registered with the Audit Oversight Board (AOB), an audit firm is to follow the procedure as laid down in sub-regulation 2 of regulation 4 of the Audit Oversight Board (Operations) Regulations, 2018. Here is a step-wise guidance to the procedure:
Click here to create your firm’s account on Audit Firm Registration System (AFRS)
Click here for step by step guide.
LOR to AOB
Submit required information to QAB to obtain a Letter of Recommendation, as specified in Schedule 4 to the Regulation.
Pay fee as specified in Schedule 3 to the Regulation. For fee schedule, click here.
For fee challan, click here.
A certificate of registration is issued subject to the these conditions under Regulation 4(10) of the Regulations
Through Finance Act 2019, Audit Oversight Board has been granted tax exemption on its total income via its inclusion under clause (66) of Part One of Second Schedule to Income Tax Ordinance, 2001. Please refer to page 206 of Finance Act 2019.
For exemption certificate U/S 151 of Income Tax Ordinance 2001, click here.
AOB CEO & CRO addressing Asean Audit Regulator Group