Andi Haswidi, Jakarta – The Supreme Audit Agency (BPK) has urged the Finance Ministry to revoke the business licenses of a number of accounting and appraisal firms due to malpractice and misrepresentation.

"We have reported these accounting and appraisal firms to the finance minister, and have suggested that their business licenses be revoked, as well as the individual professional licenses of their partners," said BPK director Anwar Nasution in Jakarta on Monday.

However, Anwar refused to name and shame the firms involved, saying only that they had all been reported to the ministry earlier this month.

Anwar said that many accounting firms involved in auditing the books of state-owned enterprises, for example, had been guilty of unprofessional conduct, including giving inflated and misleading figures in their reports.

"Their fees are reported to be unreasonably high. We suspect that part of the fees actually constitute bribes," he was quoted as saying by Antara.

"The accounts have to depict the real condition of the company being audited," he said. "If the accounts are not reliable, then they are of no use," he said.

"One of the causes of the 1997 crisis was the unreliability of the reports issued by accounting firms and government auditors. Back then, the substance of these reports was determined by how large the bribe was," he said. "We have to reform the culture in the accounting industry," he added.

Anwar said that accounting scams also took place in the developed world, such as those involving major companies like the United States-based Enron and the Italy's Farmalat.

Meanwhile, Indonesian Accountants Association (IAI) spokesman Franky Setiawan said that his association had not been notified by the BPK of the names of the individuals or companies that had been reported to the finance ministry.

Franky said that the IAI was solely responsible for membership issues. He said that under the current regulations, an accountant had to be registered as a member of the IAI before he could practice. "If the finance minister decides to revoke their licenses, than we will automatically revoke their membership," he said.

In order to improve professionalism, the IAI would have all of its members assessed by an independent agency called the Quality Review Board. "The function of the board is basically to assess quality control within accounting firms. The program will be launched around September or October," Franky explained.

Franky said that during the initial stage, the board would prioritize the assessment of high-profile accounting firms that audited the accounts of banks, publicly listed companies and other businesses involving the public.

"We have more than 400 members. These assessments could take three or four years to finish, but, of course, we will prioritize the important ones and the ones that have to potential to prejudice the public," he said.