B Mirror Report: The Bangladesh Securities and Exchange Commission (BSEC) has requested the Financial Reporting Council (FRC) to take action against Kamrul Abedin, engagement partner of M. J. Abedin & Co. Chartered Accountants, over alleged audit failures related to Delta Life Insurance Company Limited’s financial statements for five consecutive years.

According to sources, a special audit conducted on Delta Life’s financial accounts for the 2016–2020 fiscal years uncovered multiple serious irregularities, concealment of information, and lapses in auditing standards. However, the auditing firm responsible for the company’s accounts during that period reportedly failed to properly reflect those discrepancies in the audited financial reports.

The BSEC alleges that the company did not maintain the required provision against unsettled insurance claims amounting to Tk 124.02 crore. As a result, the company’s profits and earnings per share (EPS) were allegedly overstated.

The special audit also found that Delta Life purchased 30 vehicles worth Tk 6.51 crore without following its own procurement policies. In another major irregularity, an actuarial surplus of Tk 253.39 crore was allegedly not included in the equity section of the company’s balance sheet, raising concerns about the transparency of its actual financial position.

Investigators further found that members of the same family controlled 22.77 percent of the company’s total issued shares, but the matter was not adequately disclosed in the audit report.

BSEC described the most serious concern as the issuance of an “unmodified opinion” by the auditor despite the absence of sufficient audit evidence. Although the audit firm certified the financial statements without identifying major discrepancies, the later special audit reportedly revealed several significant violations and inconsistencies.

The issue was discussed in detail during a recent BSEC commission meeting. The commission decided to forward the matter to the FRC for necessary action, citing the auditor’s failure to properly reflect the violations uncovered in the special audit.

According to the commission, the alleged audit negligence misled investors and the general public regarding the company’s true financial condition.

Market analysts believe the incident has raised broader concerns about the credibility of Bangladesh’s corporate auditing system. Since investors rely heavily on audited financial statements to make investment decisions, any failure by auditors could undermine transparency in the capital market and weaken investor confidence, they said.