ACAR announces new law with fines up to 60M riel

ACAR announces new law with fines up to 60M riel

The regulation applies to audited and non-audited enterprises registered with the Ministry of Commerce and the General Department of Taxation that are classified as large and medium taxpayers.

Businesses, non-profit organisations, accountants and auditors found violating Cambodia’s Accounting and Auditing Law could face fines up to 60 million riel (approximately $15,000) under a new sub-decree set to take effect on June 25, as regulators seek to strengthen compliance and improve financial transparency.

The Accounting and Auditing Regulator (ACAR) of the Non-Banking Financial Services Authority (NBFSA) on Wednesday announced the implementation of the sub-decree on ‘Penalties for Violations of the Accounting and Auditing Law’, which will replace the interim penalty framework that has been in force since June 1, 2020.

The new sub-decree was adopted following a decision by Prime Minister Hun Manet at the 19th Government-Private Sector Forum on November 13, 2023, and in accordance with the guidelines of Aun Pornmoniroth, Deputy Prime Minister and Minister of Economy and Finance and Chairman of the FSA.

According to an ACAR notice, the sub-decree aims to strengthen enforcement of the Accounting and Auditing Law by defining offences and fines for violations, as well as establishing the authorities, measures and mechanisms for imposing and managing penalties.

The framework is intended to ensure the effective implementation of the Accounting and Auditing Law and encourage greater compliance among entities required to maintain proper accounting records and financial reporting standards, the statement added.

Under the sub-decree signed by Prime Minister Hun Manet on May 25, penalties will be imposed based on the nature and severity of violations. Enterprises and organisations that fail to submit annual financial reports face the highest penalty of 60 million riel.

The regulation applies to audited and non-audited enterprises registered with the Ministry of Commerce and the General Department of Taxation that are classified as large taxpayers and medium taxpayers. It also covers all non-profit organisations registered with competent ministries and institutions.

In addition, the sub-decree applies to all accountants and auditors who are members of the Kampuchea Institute of Certified Public Accountants and Auditors (KICPAA) and hold licences to practise accounting or auditing issued by ACAR. The regulator noted that the new sub-decree will replace the sub-decree on Interim Penalties for Violations of the Accounting and Auditing Law issued in 2020, marking a significant step in enhancing regulatory oversight and accountability.

To help stakeholders better understand the new requirements, ACAR will organise a seminar on June 25 at Phnom Penh Hotel from 8 am to 12 noon. The event is expected to provide an overview of the sub-decree, explain compliance obligations and enforcement mechanisms, and address questions.

ACAR urged business owners, heads of non-profit organisations, accountants, auditors and other stakeholders to familiarise themselves with the new provisions and cooperate in their implementation.

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