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controversial,” Fung agrees. “Some practitio-
ners took the idea very well, but others had a
bit of resistance. By the time I came on board,
it had been passed as legislation so they had
no choice but to accept it.”
Fung says that in the early stages, the em-
phasis was on encouragement, not punish-
ment. “It was practice review in a more edu-
cational sense,” he says. “ The educational
emphasis let the practitioner know what
practice review was about and how it could
help them improve their own quality.”
Mar says that approach dampened the op-
position to practice review. “ We said that in
the first round, it’s all about education. You
get advice and the Society will structure a
review by people who are capable of telling
you, ‘Look, you shouldn’t do it this way, do it
“Only in the second round, or if you refuse
to cooperate, or if you refuse to take the ad-
vice, or if we go back to do a second review
and you haven’t done a goddamned thing,
then you’ll be hauled before the Disciplinary
Committee,” he adds.
During the 1990s, about 10 percent of all
practice units in Hong Kong were selected
for practice review each year. In the first
three years, more than 400 practices were
reviewed, from which just seven cases were
referred to the Disciplinary Committee.
Even those unaffected by practice review
approved of the new system. Sanford Yung
retired as senior partner of Coopers & Ly-
brand in 1992, just before its introduction.
“Although I did not actually experience the
introduction of practice review, I believe it
helped change perceptions of ethics and the
profession was much improved,” he says.
In 1993, the Society celebrated its 20th
anniversary. In his message to the Society,
marking the milestone, Macleod said the gov-
ernment believed practice review to be one of
the Society’s most significant achievements.
“Now that the system has been in place, it
has won increasing acceptance both within
the profession and the community as an effec-
tive means of reassuring both the public and
the government that professional standards
are being maintained,” he said at the time.
Another important change in the 1992 pack-
age of reforms to the accountant ’s ordinance
included the establishment of an Investigation
Committee with its own statutory authority
to seek evidence from members until a case is
referred to the Disciplinary Committee (which
already was a statutory committee).
Other elements included the expansion
of the Council and permission for members
not holding a practising certificate to become
CPA firm partners.
In 1995, a further step was taken with
permission for CPAs to incorporate. “Now
w ith incorporation as an option, there exists a
mode of practice which affords protection for
an auditor’s personal assets against negligent
acts of his other partners,” T. Brian Stevenson,
Society president in 1996, said at the time.
Throughout the 1990s, the Society pro-
v ided input and assistance with numerous
pieces of legislation, including ordinances
related to companies, banking, tax, salaries
and pensions, insurance and securities –
even the Drug Trafficking (Recovery of Pro-
ceeds) (Amendment) Bill 1995.
The Society was also called upon to help
with legislation not related to accounting or
finance, but to its experience and expertise
as a model for qualification or self-regula-
tion, such as legislation refining the duties
of the Hong Kong Council for Academic Ac-
creditation, passed in 1995.
However, one dark cloud that hung over
the decade was whether there would be
enough accountants remaining in Hong Kong
after 1997 to ensure any new rules took affect.
After all, the end of the 1980s had seen
something of an exodus from Hong Kong
accountants. Many had gone to Canada and
Australia, anxious about the negotiations
over Hong Kong between China and the
United Kingdom through the 1980s and then
spooked by Tiananmen Square in June 1989.
Peter Wong, the profession’s first functional
constituency representative in the Legisla-
tive Council, had noted a Vocational Training
Council sur vey showed that Hong Kong had
A Society delegation visits China’s Ministry of Finance in 1996
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