SECP Holds High-Level Consultation on Reforming Pakistan’s Cost Audit Regime

The Securities and Exchange Commission of Pakistan (SECP) issued a Consultation Paper on the “Cost Audit Regime in Pakistan” in January 2025, aiming to review the utility and effectiveness of the existing cost audit framework. As part of this initiative, consultation sessions were held in Lahore and Karachi with representatives from industry, professional bodies, and regulators. The responses reflected a broad range of perspectives, with most participants viewing the current cost audit framework as compliance-heavy and offering limited practical or economic utility. Building on the feedback received, a follow-up consultation session was organized at the SECP Head Office in Islamabad on October 27, 2025, chaired by the SECP Chairperson. The session was attended by representatives from the Institute of Chartered Accountants of Pakistan (ICAP), the Institute of Cost and Management Accountants of Pakistan (ICMAP), the Ministry of Industries and Production (MoI), the Competition Commission of Pakistan (CCP), and other industry stakeholders. Participants engaged in detailed discussions on aligning the cost audit regime with international standards and enhancing its relevance to regulatory and policy objectives. It was unanimously agreed that ICAP and ICMAP would jointly undertake a comprehensive review and provide detailed recommendations to the SECP, after consulting relevant stakeholders where necessary, within three weeks. The review will focus on the formats of cost accounting statements to be annexed with audited financial statements, the scope of the audit of these annexed statements, and the mechanism for filing them with sectoral regulators. The aim is to develop a balanced and efficient cost audit framework that ensures transparency and accountability, avoids duplication of reporting requirements, and facilitates ease of doing business in Pakistan.