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The Consortium of Civil Society Organisation on Economic and Social Justice have given the Institute of Chartered Accounting of Sierra Leone (ICASL) 5-day ultimatum to explain whether the Institute itself and its member audit firms are not culpable in the Monumental Insurance Industry Fraud and Non-Compliance with Insurance Act of Sierra Leone 2016 and Financial Engineering brought to the public attention last week.
Upon receipt of serious complaints about the fraudulent operations of the international Insurance company with very strong supporting evidence on 13th September 2021 we wrote to international Insurance Company SL Limited, SLICOM, ICASL and BDO, the Audit firm that was auditing International Insurance and concealing the true financial position of the company.
According to Standard Times Newspaper, ICASL has not deemed it fit to respond to our letter with needed explanation. Meanwhile, BDO responded using their Lawyer to threaten us, therefore, for fairness to prevail ICASL, should state its position on the matter.
The involvement of ICASL is based on the following information. ICASL, was formed by an Act of Parliament on 12th May 1988 with an overarching mandate to promote and regulate the Accountancy profession in Sierra Leone and to ensure integrity, objectivity, independence, confidentiality and professionalism in the accounting profession ICASL license and regulate audit; Therefore, ICASL licenses and regulates audit practices in the Sierra Leone and International Insurance Company were given UNQUALIFIED (clean) Audit Reports in all these years despite these monumental concealments. How was that possible? We also have evidence of a formal request made in 2017 to ICASL for the Review of International Insurance Company Financial Statements. We would like to know what the outcome of ICASL review was, who did the investigation, their findings and Conclusion. Why were the fraudulent Insurance practices and auditing opinions not sanctioned to serve as deterrent to others? We are aware that KPMG South Africa were sanctioned for concealment involving the Firm of former South African President, Arthur Anderson a leading US Audit Firm was held liable for audit negligence in expressing an Unqualified Audit Opinion on Financial statements with several concealments; Following the complaints, the consortium has examined sample Audited Financial Statements of 4 Leading Insurance Companies operating a Life Assurance Scheme with UNQUALIFIED Audit Opinion in the country and compare same with a sample audited financial statement of a leading Insurance Company from Nigeria. The gaps are wide; key observations are; Life Assurance Funds were not accounted for. The Life Assurance Premium was not accounted for and liabilities arising from the accrued Life Benefits were not even mentioned or provided in the financial statements; we did not see clearly Investments for Life Assurance Funds disclosed separately; and The Investment income.
