This article first appeared in The Edge Financial Daily on August 20, 2019

KUALA LUMPUR: Messrs Chengco PLT (or formerly known as Cheng & Co) and its partners have been barred by the Securities Commission Malaysia’s Audit Oversight Board (AOB) from accepting public interest entities (PIEs) or schedule funds as clients and auditing their financial statements for 12 months.

This followed the dismissal of Hong Thuan Boon, Liew Kwai Choy and Yap Peng Boon’s appeal against the AOB's decisions to prohibit the firm, Hong and Liew on Aug 6.

In a statement yesterday, the AOB said the firm and its partners concerned were found having multiple instances of non-compliance with international auditing standards, discovered in two inspections by the AOB in 2016 and 2018 respectively.

The AOB also noted the firm had failed to remedy a recurring finding identified in the first inspection.

“As a result, the firm and the partners, Hong Thuan Boon and Liew Kwai Choy, were prohibited from accepting PIEs or schedule funds as clients and auditing their financial statements for 12 months,” it added.

Hong and Liew were an engagement partner and engagement quality control reviewer respectively for the auditing firm. The firm was also fined RM175,000, and Hong RM57,000. Another of the firm’s partner, Yap, was fined RM44,000 for non-compliance with audit procedures. Chengco’s listed clients include Smile-Link Healthcare Global Bhd, Kawan Food Bhd, PNE PCB Bhd, Ygl Convergence Bhd and M3 Technologies (Asia) Bhd.