The National Board of Revenue (NBR) and Institute of Chartered Accountants of Bangladesh (ICAB) had teamed up on November 12, 2020, to curb the scope for submitting fake audited financial statements.

As a part of their initiative, a digital system called the document verification system (DVS) was launched to prevent unruly firms from submitting falsified or multiple audited financial statements that hide their actual income from the NBR.

A month later, the NBR asked its field offices for tax to use the DVS in order to ensure that businesses are depositing their due amount of corporate income tax to the state coffer.

Eventually other major regulatory bodies -- the Financial Reporting Council, Bangladesh Bank and Bangladesh Securities and Exchange Commission -- also issued directives to ensure the use of DVS in a concentrated effort to end fake financial reporting.

Through this digital system, participating members of ICAB have to provide five key financial data on the company they are auditing. This includes the firm's profits, turnover, total assets and the company's liability for a stipulated period.

After that, the ICAB members will generate an 18-digit Document Verification Code (DVC) that will be printed on the signed audited financial statement.

Through the DVC, relevant regulatory agencies and tax offices can then use the DVS from the ICAB website to compare details of the financial report with their own database and approve its authenticity.

Ever since the system was first launched, ICAB members have issued nearly 32,600 DVCs, meaning that they authenticated and signed off on the same number of financial statements.

"We have addressed all malpractices completely and impeccably through the DVS," said ICAB President Md Shahadat Hossain in an interview with The Daily Star recently.

He went on to say that the benefits of using the DVS for issuing properly audited accounts would soon be clear to all.

Many businesses previously avoided holding their annual general meetings (AGMs) every year but due to the introduction of the DVS, they will have to hold AGMs and submit tax returns regularly.

"Through the DVC, the user can verify the audited company details and besides, it ensures that the same report can never be generated twice," Hossain added.

The ICAB president also spoke about the fees they charge for carrying out their duties, citing that the organisation has prepared a schedule in this regard so that companies can avail services at officially determined rates.

However, he then informed that members are still not taking the scheduled fees from their clients.

"We even directed our members to make sure that the companies don't see the fee as a burden," Hossain said.

ICAB, which began its journey back in 1973, has around 160 firms while the country has around 30,000 professionals who have completed a chartered accountancy course.

Over the last five decades, the institute developed around 2,200 chartered accountants. Of them, 1,700 to 1,800 are now still in the country.

"Our chattered accountants are of international standard. As a result, they get appreciation from Canada, Australia and many other parts of the world," he added.