Recent fraud cases disgrace accountants

JAKARTA (JP): The chairman of the Association of Indonesian Accountants, Soedarjono, acknowledged yesterday that his organization must address integrity problems plaguing the accounting profession in Indonesia.

Soedarjono told newsmen after a meeting with Vice President Try Sutrisno that the integrity of accountants has come under increased scrutiny as a result of several well publicized cases of project price mark-ups, bad credits and manipulation of financial reports.

"Some accountants are alleged to have collude with businessmen in manipulating financial reports," added Soedarjono.

He also said that some accountants may have helped investors mark up the costs of their projects in attempts to secure larger loans.

"The price mark-ups have enabled some borrowers to receive much larger loans than they required for their projects," added Soedarjono, who is also chief of the Government Audit Agency (BPKP).

Soedarjono acknowledged, however, that it was difficult for the association to prove such allegations because of a lack of transparency in the country's information system.

"Under the existing accounting principles, it is extremely difficult to detect the alleged manipulation," he said, adding that collusion is often detected only when the problems it creates surface and are brought to the attention of the public.

"In Singapore, you can get full access to comprehensive price information by paying only 10 or 15 dollars. That is rather impossible here," he pointed out.

The association's executive board reported to the Vice President on the results of the organization's national meeting recently held in Bandung, as well as the planned congress of the ASEAN Federation of Accountants in Bali on Oct.5.

Radius Prawiro, former coordinating minister for economic and financial affairs, also joined the meeting with the Vice President and acted in his capacity as chairman of the organization's Advisory Board.

Soedarjono said that Indonesian accountants should work harder to improve their professional image so they cam compete with foreign counterparts in the global marketplace.

Eventually foreign accountants will be free to work in Indonesia under the World Trade Organization's global trading system. Indonesian accountants should prepare now to face future international competition, Soedarjono said.

At present, foreign accountants are allowed only to offer their services in cooperation with local accounting offices.(hen)