Continuing its integrity focus on the Minimum Financial Requirements (MFR) reporting and the accounting profession, the Queensland Building and Construction Commission (QBCC) announced last week that 10 more accountants are no longer recognised as ‘Qualified Accountants’ for their purposes. This brings the total number to 15 and follows a similar QBCC announcement back in August 2019.
Being a Qualified Accountant is a pre-requisite for signing documents under the MFR Regime, the cornerstone of the financial framework under which QBCC licensees are assessed. In their media release, QBCC states “all of these accountants have either provided false and misleading information, or in the alternative, provided information that may be incorrect or incorrectly applies the MFR”. These comments reinforce that integrity and a sound understanding of the MFR regime are both non-negotiables.
In some cases, removal was due to accountants failing to ensure that licensees paid their debts as and when they fell due.
While the listed accountants are no longer able to sign MFR documents, there is a bigger question for QBCC licensees.
As a starting point, a QBCC licensee who relied on one of the listed accountants to navigate the MFR complexities are now likely to find themselves under a microscope from the building and construction regulator which could have been avoided.
More broadly, QBCC licensees and their advisers must always come from a position of honesty and integrity when dealing with the QBCC, including when providing financial information as required under the MFR regime. There is a fundamental requirement for an accountant to provide independent, and sometimes hard to swallow, advice to all clients. When this fails, the profession is damaged. In these circumstances, expect the QBCC (and all stakeholders in the profession) to take action similar to what is being reported here.
As I’ve highlighted in a previous article, regular monitoring of the QBCC specific ratios is a sound starting point in managing the right to trade here in Queensland. Where the financial review process is only annual, such as year-end financial statements and tax returns, the opportunities to make tough decisions, financially restructure, adjust for changing market conditions, or any of the other options available, are unlikely to be managed appropriately.
When accountants work with QBCC licensees to manage their financial stability, all participants in the industry benefit. On the flip side, when accountants actively undermine this integral process by providing “false and misleading information” or incorrectly applying the MFR regime, the industry is weaker.