1. Which statement correctly distinguishes the roles of ICAB and the Financial Reporting Council (FRC) of Bangladesh?

A) The FRC admits members and issues practising certificates, while ICAB oversees the audits of public interest entities under the 2015 Act
B) ICAB regulates its members under the 1973 Order, while the FRC, under the Financial Reporting Act 2015, oversees financial reporting and audit in the public interest
C) The FRC replaces ICAB's disciplinary role, leaving ICAB responsible only for examinations, training and student registration
D) ICAB sets the listing rules for the stock exchanges, while the FRC registers companies and receives their annual returns under the Companies Act

Correct: B difficult Regulation of the profession

ICAB is the professional body for chartered accountants, controlling entry, training, practising certificates and member conduct. The FRC, created by the Financial Reporting Act 2015, provides public-interest oversight of financial reporting, auditing standards and the auditors of public interest entities. If you gave ICAB the audit oversight and the FRC the membership role, you swapped the bodies. Listing rules belong to BSEC and company registration to the Registrar of Joint Stock Companies and Firms. The FRC oversees but does not replace ICAB's regulation of its members.

2. The most common criticism of the self-regulation of a profession by its own members is that:

A) regulators who are also practitioners may be seen as protecting their own interests
B) self-regulation is always more costly to the public purse than statutory regulation would be
C) professional bodies have no power to discipline members who breach their codes
D) practitioners lack the technical knowledge needed to set professional standards for themselves

Correct: A difficult Self-regulation

Self-regulation draws on practitioners' technical expertise and is flexible, but the main concern is perceived or actual conflict of interest, which is why independent oversight such as the FRC's was introduced. If you chose lack of knowledge you reversed a recognised strength. If you chose cost you assumed a funding disadvantage that does not follow. If you chose no disciplinary power you ignored that bodies such as ICAB can sanction members.

3. Which TWO statements about anti-money laundering (AML) in Bangladesh are correct? (Select TWO.)

Multiple response
A) The BFIU is the principal national authority for receiving and analysing information on suspicious transactions
B) An accountant should tell the client that a suspicious transaction report has been made
C) Reporting organisations must report suspicious transactions to Bangladesh Bank through the BFIU framework
D) ICAB is the principal national authority for AML
E) AML duties apply only to banks

Correct: A, C complex Anti-money laundering

The BFIU, within Bangladesh Bank, receives, analyses and disseminates suspicious transaction information, and reporting organisations report through that framework. Telling the client is 'tipping off' and is prohibited. ICAB supports AML compliance by educating and supervising members but is not the national authority. AML duties cover a wide range of reporting organisations, especially in the financial sector, not only banks.

4. Consider the regulation of accountants in Bangladesh. For each statement, select Yes if it is correct and No if it is not.

Yes/No grid

1. Members working in business are more highly regulated by ICAB than members in practice.   No

2. Owners or partners of a practice must hold a practising certificate.   Yes

3. FRC oversight replaces ICAB's self-regulatory role entirely.   No

Correct: N, Y, N difficult Regulation of members

(1) No: members in practice face more detailed requirements. (2) Yes. (3) No: ICAB retains its role under the 1973 Order; the FRC provides oversight alongside it.

5. Consider the Bangladesh AML regime. For each statement, select Yes if it is correct and No if it is not.

Yes/No grid

1. Customer due diligence, record keeping and internal controls are part of AML requirements.   Yes

2. Professional bodies such as ICAB help by educating members on AML responsibilities.   Yes

3. The BFIU issues circulars and guidance and promotes compliance frameworks.   Yes

4. Only audit firms are reporting organisations.   No

Correct: Y, Y, Y, N difficult AML framework

(1) Yes. (2) Yes. (3) Yes. (4) No: reporting organisations cover a wide range of entities, particularly in the financial sector.

6. A Dhaka bookkeeper with no professional qualification describes himself as an 'accountant' and prepares accounts for small traders. He does not call himself a Chartered Accountant. Which statement is most accurate for Bangladesh?

A) There is no general legal requirement to belong to a professional body to describe oneself simply as an accountant, but the 'Chartered Accountant' title is restricted to qualified ICAB members
B) He may use both the 'accountant' and 'Chartered Accountant' titles freely, because title restrictions apply only when a person signs statutory audit reports
C) Only members of ICAB may describe themselves as an accountant in any context, so his description of himself is an offence even without the Chartered Accountant title
D) He may use the 'accountant' title only if he holds a certificate of practice, because the certificate is what authorises people to prepare accounts

Correct: A difficult Use of the title accountant

The workbook explains that no general legal requirement exists for a person describing himself simply as an 'accountant' to be a member of a professional body, whereas 'Chartered Accountant' and 'Cost and Management Accountant' are regulated by law through ICAB and ICMAB. Certificates of practice relate to regulated areas such as statutory audit, not to the general use of the word accountant.

7. Members of professional accountancy bodies in Bangladesh face competition from unqualified persons in general accounting and bookkeeping work. In which area do qualified members retain exclusive rights because of specific qualification, certificate of practice and regulatory approval requirements?

A) General business advisory work
B) Preparation of monthly management accounts
C) Statutory audit
D) Bookkeeping for small traders

Correct: C difficult Regulated areas of practice

Statutory audit and other regulated forms of professional practice require specific qualifications, certificates of practice and regulatory approval. General accounting, bookkeeping and advice are open to competition from people without a recognised professional qualification.

8. Which THREE are among the activities of the Financial Reporting Council of Bangladesh under the Financial Reporting Act 2015? (Select THREE.)

Multiple response
A) Setting corporate tax rates
B) Monitoring the quality of audit and financial reporting in public interest entities
C) Enlisting and overseeing auditors and audit firms for relevant engagements
D) Registering new private companies
E) Adopting and updating standards for financial reporting, auditing and ethics
F) Setting monetary policy

Correct: B, C, E difficult Functions of the Financial Reporting Council

The FRC sets and adopts standards, monitors audit and reporting quality in public interest entities and regulates the audit profession, including enlistment. Tax rates are set through law and administered by the NBR, company registration is by RJSC, and monetary policy belongs to Bangladesh Bank.

9. Consider the International Federation of Accountants (IFAC). For each statement, select Yes if it is correct and No if it is not.

Yes/No grid

1. IFAC has over 175 member organisations and associates, including ICAB.   Yes

2. IFAC has direct power to discipline individual ICAB members in Bangladesh.   No

3. ICAB's Code of Ethics is largely based on IFAC's framework-based Code.   Yes

4. IFAC aims to protect the public interest by encouraging high-quality practices by accountants.   Yes

Correct: Y, N, Y, Y difficult IFAC

(1) Yes. (2) No: discipline of members is a matter for ICAB and the oversight framework, not IFAC. (3) Yes. (4) Yes.

10. Consider the regulation of professions. For each statement, select Yes if it is correct and No if it is not.

Yes/No grid

1. Regulation is justified where issues are too technically complex for the public to look after their own interests.   Yes

2. Regulation should be designed to protect existing members from competition.   No

3. The Bangladesh accountancy profession uses self-regulation backed by an independent oversight mechanism.   Yes

4. Regulation should impose heavier burdens on some firms than on others to reward quality.   No

Correct: Y, N, Y, N difficult Regulation of professions

(1) Yes. (2) No: regulation should not protect vested interests. (3) Yes. (4) No: regulation should not distort competition by imposing extra burdens on some but not others.

11. Which audit engagement falls within the oversight of the Financial Reporting Council of Bangladesh under the Financial Reporting Act 2015?

A) The internal audit of a charity's petty cash by its own volunteers
B) The statutory audit of a listed bank, as a public interest entity
C) The preparation of a sole trader's tax return by a bookkeeper
D) The compilation of management accounts for a family-owned shop

Correct: B difficult Public interest entities

The FRC regulates financial reporting, auditing and related standards in respect of public interest entities, such as listed companies and financial institutions. Bookkeeping, volunteer checks and compilation work for small businesses are outside its remit.

12. Which is the main advantage claimed for self-regulation of the accountancy profession by ICAB rather than regulation solely by a government department?

A) Members can never be disciplined because the profession polices itself
B) The profession's technical expertise is used and the cost to the state is lower
C) The public interest is automatically protected without any oversight
D) Regulation is free of any perception of self-interest

Correct: B difficult Self-regulation

Self-regulation draws on professional expertise and is usually cheaper for government. The risk is a perception that the profession protects itself, which is why an independent oversight mechanism is used.

13. Why is it important that the oversight mechanism for a self-regulating accountancy profession is independent of the profession?

A) To ensure that only government employees may qualify as accountants
B) To maintain public confidence that regulation does not serve the profession's self-interest
C) To remove the need for a code of ethics
D) To allow the profession to avoid disciplinary rules altogether

Correct: B difficult Independent oversight

Independence counters accusations that the profession is pursuing its own self-interest and supports confidence in regulation.

14. A member of ICAB with no experience of banking accepts the audit of a Bangladeshi microfinance institution without training or consultation and issues the report. Which fundamental principle is most directly at risk?

A) Confidentiality
B) Objectivity
C) Professional behaviour
D) Professional competence and due care

Correct: D complex Professional competence

Accepting work beyond one's competence, without developing it or seeking support, risks the principle of professional competence and due care.

15. Shareholders blame an auditor after management and the head of accounts collude to hide a fraud that the audit did not detect. The auditor carried out the audit properly and gave reasonable assurance. Which concept best describes the shareholders' view?

A) Self-review threat to the auditor's independence
B) Failure of the oversight mechanism to meet the auditor
C) The expectation gap between what the public expects of auditors and what an audit provides
D) Conflict between ICAB's Code and company law

Correct: C complex Expectation gap

An audit gives reasonable (not absolute) assurance and may not detect collusive fraud. Public expectations are often higher than that, which is the expectation gap.

16. A member of ICAB who is not authorised to practise wants to sign a statutory audit report for a client. Which statement is correct?

A) Any person may sign statutory audit reports because 'accountant' is not a protected title
B) Only the client's management may decide who signs the report
C) A certificate of practice is required only for bookkeeping
D) Statutory audit is a regulated area requiring the right qualification, certificate of practice and regulatory approval

Correct: D difficult Regulated practice

Statutory audit and some other practice areas require specific qualifications, certificates of practice and regulatory approval, even though the general title 'accountant' is not restricted.

17. Which THREE are typical characteristics of a profession? (Select THREE.)

Multiple response
A) Maximising owners' profits as the primary duty
B) No requirement for qualifications
C) Complete freedom from regulation
D) Duty to act in the public interest
E) Specialised body of knowledge
F) A code of ethics

Correct: D, E, F difficult Characteristics of a profession

Professions rest on specialised knowledge, ethical standards and an obligation to act in the public interest. Qualifications and regulation are usual features.

18. Which TWO roles are typical of professional accountants in business rather than public practice? (Select TWO.)

Multiple response
A) External auditor
B) Financial controller
C) Insolvency practitioner
D) Management accountant
E) Tax adviser in a firm of chartered accountants

Correct: B, D difficult Accountants in business

Accountants in business work for an employer in roles such as financial controller and management accountant. External audit, tax advice and insolvency work are typically in practice.

19. Which TWO are proper objectives of regulating the accountancy profession? (Select TWO.)

Multiple response
A) Protecting the public interest
B) Raising fees for the profession
C) Maintaining confidence in the profession
D) Distorting competition between firms
E) Protecting existing members from competition

Correct: A, C difficult Objectives of regulating the profession

Regulation should protect the public and maintain confidence. It should not protect vested interests or distort competition.

20. Consider the regulatory framework for accountants in Bangladesh. For each statement, select Yes if it is correct and No if it is not.

Yes/No grid

1. Anyone describing himself as an 'accountant' must be a member of ICAB.   No

2. ICAB was established under the Bangladesh Chartered Accountants Order 1973.   Yes

3. A non-member with a certificate of practice may lawfully use the title Chartered Accountant.   No

4. The FRC operates under the Financial Reporting Act 2015.   Yes

Correct: N, Y, N, Y complex ICAB, titles and the FRC

(1) No: there is no general legal requirement for the general term 'accountant'. (2) Yes. (3) No: the Chartered Accountant title is restricted to qualified ICAB members. (4) Yes.

21. Consider how professions should be regulated. For each statement, select Yes if it is correct and No if it is not.

Yes/No grid

1. Regulators use judgement to balance different aspects of the public interest.   Yes

2. Regulation should not impose burdens out of proportion to the benefit gained.   Yes

3. Regulation may legitimately protect existing practitioners from competition.   No

4. An independent oversight mechanism removes the need for any professional code of ethics.   No

Correct: Y, Y, N, N difficult Principles of regulation

(1) Yes. (2) Yes. (3) No. (4) No: oversight complements, and does not replace, a code.

22. Consider IFAC and the ICAB Code. For each statement, select Yes if it is correct and No if it is not.

Yes/No grid

1. IFAC aims to protect the public interest by encouraging high-quality practices.   Yes

2. IFAC can fine individual ICAB members directly.   No

3. IFAC has more than 175 member organisations and associates.   Yes

4. ICAB's Code of Ethics is unrelated to IFAC's Code.   No

Correct: Y, N, Y, N difficult IFAC

(1) Yes. (2) No. (3) Yes. (4) No: it is largely based on it.

23. Consider the Financial Reporting Council. For each statement, select Yes if it is correct and No if it is not.

Yes/No grid

1. It monitors the quality of audit and financial reporting in public interest entities.   Yes

2. It can act in matters of discipline and enforcement within its statutory jurisdiction.   Yes

3. It sets the rates of personal income tax.   No

4. It regulates the enlistment of auditors and audit firms for relevant engagements.   Yes

5. It sets the listing rules of the stock exchanges.   No

Correct: Y, Y, N, Y, N complex Scope of the FRC

(1) Yes. (2) Yes. (3) No. (4) Yes. (5) No: listing and disclosure are for BSEC and the exchanges.

24. A member is asked to value a complex financial instrument outside her expertise. For each statement, select Yes if it is correct and No if it is not.

Yes/No grid

1. Competence is needed only at the time of qualification.   No

2. She should decline the work or obtain suitable assistance.   Yes

3. Due care means acting diligently in accordance with applicable standards.   Yes

4. Competence must be maintained only if a client requests it.   No

Correct: N, Y, Y, N complex Professional competence

(1) No. (2) Yes. (3) Yes. (4) No: competence must be maintained through continuing development.

25. After a fraud involving collusion at a company, shareholders criticise the auditor. For each statement, select Yes if it is correct and No if it is not.

Yes/No grid

1. Collusive fraud is always detected by a properly conducted audit.   No

2. Public education about the purpose of an audit can narrow the expectation gap.   Yes

3. An audit provides reasonable assurance.   Yes

4. An auditor guarantees that no fraud exists.   No

Correct: N, Y, Y, N complex Expectation gap

(1) No. (2) Yes. (3) Yes. (4) No.