SEC Secretary-General Ruenvadee Suwanmongkol said “this is the first time in Thailand that a comparative study between Thai laws on the supervision of auditors and audit firms in Thai capital market and foreign laws is conducted. The proposals resulting from this study will be greatly beneficial to amendment of the Securities and Exchange Act B.E. 2535 (Securities and Exchange Act) to enhance effectiveness in enforcement of the law and protection of investment to be aligned with international standards”

From the study of the related laws in five influential countries and a focus group meeting with stakeholders, information and comments from which was used in drawing up a proposal for revision of oversight of auditors and audit firms in Thai capital market, TDRI offered a detailed proposal as follows:

(1)  The Securities and Exchange Act to be amended to enable SEC to register the audit firms in the capital market and to supervise and impose sanction on an audit firm in the capital market found by SEC to have failed to maintain sufficient quality control system in accordance with the professional standards, which will raise the investor protection and creditability of Thai capital market to be in alignment with standards adopted by top-tier global capital markets;

(2)  SEC to disclose the audit inspection results of the audit firms and auditors in the capital market to public and the Audit Committee of the listed companies, which are the clients of the auditors and the audit firms, respectively. Information of which is useful for performance of duties under the Charter of the Audit Committee, such as the review of financial statement and selection of SEC-registered auditors, and to encourage stakeholders of financial reporting ecosystem to put more attention and importance to audit quality, which will serve as a mechanism to motivate the auditors and audit firms to provide better quality auditing service;

(3)  SEC to be empowered to set professional standards for audit firms and auditors in the capital market in addition to those issued by the Thailand Federation of Accounting Professions to enhance creditability of the audit quality of a listed company;

(4)  SEC to define the levels of sanction on the capital market auditor in the Securities and Exchange Act and to repeal and replace the provisions on renewal of the approval of the capital market auditor every 5 years with a permanent approval to lessen burdens of the capital market auditor, provided that the knowledge, skills and quality of work are evaluated by SEC on a regular basis.

In addition, TDRI has presented the draft proposal to the stakeholders through Facebook live streaming on 15 May 2020 from 1.30 pm to 3.30 pm. Stakeholders and interested parties are welcome to submit comments on the draft proposal until 2 June 2020. The comments will be used by TDRI in preparing the proposal for revision of oversight of auditors and audit firms in the capital market. The study and the proposal on that matter are expected to be completed by June 2020. SEC will then promptly submit the proposed revision of the Securities and Exchange Act and the study result to the Department of Business Development, Ministry of Commerce for use, where relevant, in the amendment of the Accounting Professions Act B.E. 2547.

Stakeholders and interested parties are welcome to watch video of the live stream of the presentation of the draft proposal on Facebook page “Thailand Development Research Institute” or click https://www.facebook.com/tdri.thailand/ and submit comments on the draft proposal by filling out the questionnaire available at https://forms.gle/9obfP7SDmaJ5775J7 until 2 June 2020. 

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