“Minister Al-Huwailah” announces new cooperative law to penalize negligent auditors

The Minister of Social Affairs, Family and Childhood Affairs, Dr. Amthal Al-Huwailah, announced that the new law for cooperative societies is nearing finalization.
The draft law is currently being reviewed by the relevant authorities to provide feedback, with any amendments or changes to its provisions aimed at strengthening the cooperative movement and serving Kuwait’s interests.
Al-Huwailah highlighted a key provision of the new Cooperative Societies Law, which imposes penalties on financial and administrative auditors appointed by the Ministry.
These penalties apply in cases of proven intentional negligence or collusion that harm the society, impact its financial standing, or lead to the loss of shareholders’ funds, which are regarded as a trust held by the Ministry.
Al-Huwailah emphasized that the penalties outlined in the new cooperative societies law will apply not only to employees within the cooperative sector but also to any negligent employee lacking competence in their role. This measure aims to address any deficiencies that arise. Conversely, the law will include incentives and rewards to recognize and encourage proficiency.
Furthermore, Al-Huwailah highlighted the critical role of auditors as intermediaries between the Ministry of Social Affairs and the boards of directors of cooperative societies. She stressed that the outcomes and recommendations of audit reports significantly influence key decisions, such as dissolving boards, dismissing members, or referring cases to the Public Prosecution.
Al-Huwailah underscored the necessity for auditors to maintain complete accuracy and integrity in their reporting, ensuring no negligence or willful ignorance of violations, to avoid accountability, legal action, and penalties.
Moreover, Al-Huwailah emphasized the importance of thorough verification by auditors, requiring conclusive evidence, papers, and documents to support any claims of violations.
Al-Huwailah stressed the need for early intervention to prevent serious infractions by gradually applying the penalties outlined in the law and regulations. This proactive approach, she stated, would ensure that the cooperative sector operates in a way that serves and benefits the broader cooperative movement.