FSC punishes 12 certified accountants

The Financial Supervisory Commission yesterday imposed penalties on 12 certified public accountants for negligence in certifying financial documents of several companies hit by corporate scandals.

The accountants are held responsible for irregularities at such companies as Procomp Informatics Co (博達科技), Summit Computer Technology Co (皇統科技), Infodisc Technology Co (訊碟科技) and High Tech Computer (HTC, 宏達電), the commission said.

"In order to maintain order in the market, all accountants will definitely be held responsible for their duties in conducting due diligence checks into the finances of listed companies," commission vice chairman Lu Daung-yen (呂東英) said yesterday.

According to Wu Tang-chieh (吳當傑), head of the commission's securities and futures bureau, Hsu Chun-chen (徐俊成) and Chao Chi-hao (趙志浩) of Lan Jai Certified Public Accountants (聯捷會計), who failed to thoroughly review High Tech Computer's finances, are suspended from certifying listed companies' financial reports for two years, beginning in January.

Two other accountants for High Tech Computer, Liu Yi-chi (劉義吉) and Chang Chia-hsin (張嘉信) from KPMG Certified Public Accountants (安侯), were also suspended from practicing the same duty for one year, also beginning in January.

Another two KPMG accountants, Tsai Tien-yuan (蔡添源) and Ho Chin-chiang (何靜江), who failed in their professional duties in certifying Procomp's finances, were given a six-month suspension. Since Tsai had previously been punished for other infractions, he is restricted from practicing until Feburary 2007.

Also, two other KPMG accountants, Yu Chi-lung (余紀隆) and Liu Chin-tong (柳金堂), were given a warning for failing to collect sufficient evidence to support their endorsement of Summit Computer's financial records.

Also found negligent in certifying Summit Computer's finances were Kao Tsung-ming (郭宗銘) and Chen Shen-fa (陳順發) from PricewaterhouseCoopers Taiwan (資誠會計). The two were given a three-month suspension, starting January.

A warning was given to Wang Chin-lai (王金來) and Chang Lan-chin (張嵐菁) from Diwan, Ernst & Young (致遠會計) for negligence in collecting sufficient evidence to support their certification of Infodisc's pre-paid investments.

The commission yesterday also revoked President Securities Investment Trust Co's (總統投顧) license, saying it had repeatedly attempted to manipulate the stock performance of certain companies by making groundless forecasts of share-price rises.

The company was found to have published advertisements in newspapers that exaggerated the performance of an unspecified company's overseas re-investment, which the company denied, so as to attract investments from investors, according to Wu.

The trust company's president, Wang Tong (王瞳) was also suspended from practicing business for three months due to similar misconduct when presenting his analysis of the company's shares while hosting a TV program.

"No equity analysts can predict share prices of a company without solid research to support their analysis," Wu said.