Building for Sustainable Growth—(re)Defining Accountancy Profession in the Age of Twitter
•
1 recomendación•1,277 vistas
Presentation given by Szymon Radziszewicz, IFAC Senior Technical Manager, during a seminar on the IFAC and the accountancy profession at the Philippines Institute of Certified Public Accountants.
Recomendados
Recomendados
Más contenido relacionado
La actualidad más candente
La actualidad más candente (20)
Destacado
Destacado (19)
Similar a Building for Sustainable Growth—(re)Defining Accountancy Profession in the Age of Twitter
Similar a Building for Sustainable Growth—(re)Defining Accountancy Profession in the Age of Twitter (20)
Más de International Federation of Accountants
Más de International Federation of Accountants (20)
Último
Último (20)
Building for Sustainable Growth—(re)Defining Accountancy Profession in the Age of Twitter
- 1. Page 1 | Confidential and Proprietary Information Building For Sustainable Growth – (re)Defining Accountancy Profession in the Age of Twitter Szymon Radziszewicz Senior Technical Manager Member Body Development Team Leader PICPA Seminar Manila, Philippines April 11, 2013
- 2. Page 2 | Confidential and Proprietary Information Conventional Approach Think Profession
- 3. Page 3 | Confidential and Proprietary Information Live Core Values – Think Different Think Profession
- 4. Page 4 | Confidential and Proprietary Information • The context • Regulation of the profession – the global perspective • Role of the national profession – Commitment to quality – Implementation support & thought leadership • What is IFAC & its SMOs • Adoption & Implementation of international standards • Quality Assurance – concept & examples • How IFAC assists Outline Today’s Presentation
- 5. Page 5 | Confidential and Proprietary Information 5000 Years Ago
- 6. Page 6 | Confidential and Proprietary Information 500 Years Ago
- 7. Page 7 | Confidential and Proprietary Information 84 Years Ago
- 8. Page 8 | Confidential and Proprietary Information 5 Years Ago
- 9. Page 9 | Confidential and Proprietary Information Last Year Why Greece won't go away By Laurence Knight Business reporter, BBC News 6 February 2012
- 10. Page 10 | Confidential and Proprietary Information What Now?
- 11. Page 11 | Confidential and Proprietary Information Global Landscape Today • Pressures on the broader financial architecture – Economy in recovery – Increased regulatory proposals resulting from global financial crisis – Sovereign debt crisis • Globalization – Information, capital, accountants moving across borders – Integrated reporting and long term sustainability • Diverse and segmented – Large multinationals/networks and smaller local SMEs and SMPs – Accountants in diverse roles: auditors, preparers, advisors, strategic business leaders (CFO/CEO/COO) • Twitter generation – 140 Complexity
- 12. Page 12 | Confidential and Proprietary Information • Global regulatory convergence – IFAC’s position; importance of high-quality globally accepted standards and consistent adoption, implementation and oversight • Balancing shared regulation – Policy Position Paper (PPP) 1 and the role of professional accountancy organizations • Statements of Membership Obligations (SMOs) – A framework for credible and high quality professional accountancy organizations (PAOs) IFAC Perspective on Regulation Clarity
- 13. Page 13 | Confidential and Proprietary Information • Regulation of individual professional accountants is primarily conducted at a national level, with professional accountancy organizations playing an important role in working with governments to ensure that such regulation is effective, efficient, and in the public interest • Shared approach to regulation – roles for government and PAOs Regulation of the Accountancy Profession Finding the Balance
- 14. Page 14 | Confidential and Proprietary Information Strong Accountancy Profession = Inclusive and Sustainable Growth • Maintain core values • Think different • Push boundaries • Commit to public interest • Create, contribute, give! Role of the Profession
- 15. Page 15 | Confidential and Proprietary Information The Goal – Provide Quality Information • Contribute to economic stability and growth • Enhance efficiency and accountability of businesses • Promote and support governmental transparency and accountability • Be a key player in (re)building confidence in financial markets Role of the Profession
- 16. Page 16 | Confidential and Proprietary Information • Educate stakeholders • Advocate the role of the profession • Raise awareness – Need for accountants and auditors – Global regulatory convergence – Public & Private Sector • Input into development of legislation and regulation • Support to those in charge Be the Voice Role of the Profession
- 17. Page 17 | Confidential and Proprietary Information • Education and training • If not the responsible body • Advocacy for international best practice • Input into the development of standards • Support implementation of standards • Promote and monitor adherence to ethics and independence requirements Provide Support Role of the Profession
- 18. Page 18 | Confidential and Proprietary Information • Commitment to the public interest • Adherence to the values of integrity, transparency and expertise • Commitment to follow high standards • Ongoing education • Oversight of its public interest activities Leadership Through Action Role of the Profession
- 19. Page 19 | Confidential and Proprietary Information Global Profession IFAC
- 20. Page 20 | Confidential and Proprietary Information For the global accountancy profession to be recognized as a valued leader in the development of strong and sustainable organizations, financial markets and economies IFAC’s Vision Ultimate Objective
- 21. Page 21 | Confidential and Proprietary Information Overview of IFAC Structure Transnational Auditors Committee Professional Accountancy Organization Development Committee Professional Accountants in Business Committee Small and Medium Practices Committee Compliance Advisory Panel International Auditing and Assurance Standards Board International Accounting Education Standards Board International Ethics Standards Board for Accountants International Public Sector Accounting Standards Board Forum of Firms Planning and Finance Committee Governance and Audit Committee Nominating Committee IFAC Regulatory Liaison Group IFAC COUNCIL IFAC BOARD ACCOUNTABILITY KEY
- 22. Page 22 | Confidential and Proprietary Information Oversight of IFAC PIACs Transnational Auditors Committee Professional Accountancy Organization Development Committee Professional Accountants in Business Committee Small and Medium Practices Committee Compliance Advisory Panel International Auditing and Assurance Standards Board International Accounting Education Standards Board International Ethics Standards Board for Accountants International Public Sector Accounting Standards Board Forum of Firms Planning and Finance Committee Governance and Audit Committee Nominating Committee Public Interest Oversight Board IFAC Regulatory Liaison Group IFAC COUNCIL IFAC BOARD ACCOUNTABILITY KEY OVERSIGHT
- 23. Page 23 | Confidential and Proprietary Information IFAC Oversight and Consultation Transnational Auditors Committee Professional Accountancy Organization Development Committee Professional Accountants in Business Committee Small and Medium Practices Committee Compliance Advisory Panel International Auditing and Assurance Standards Board International Accounting Education Standards Board International Ethics Standards Board for Accountants International Public Sector Accounting Standards Board Consultative Advisory Group Consultative Advisory Group Consultative Advisory Group Forum of Firms Planning and Finance Committee Governance and Audit Committee Nominating Committee Public Interest Oversight Board IFAC Regulatory Liaison Group Monitoring Group IFAC COUNCIL IFAC BOARD ACCOUNTABILITY OVERSIGHT CONSULTATION/ADVICE KEY
- 24. Page 24 | Confidential and Proprietary Information • In accordance with IFAC Constitution, IFAC members and associates are required to comply with the SMOs • Member and associates have to identify and take actions to fulfill the requirements set out in the SMOs What are the SMOs IFAC SMOs – International Soft Law
- 25. Page 25 | Confidential and Proprietary Information • Clear benchmarks for PAOs • Enable high quality performance by professional accountants • Encourage continuous improvement • Drive sustainable development of the accountancy profession Power to Grow What are SMOs
- 26. Page 26 | Confidential and Proprietary Information SMO 7: IFRS SMO 3: ISA SMO 5: IPSAS SMO 2: Education SMO 4: Ethics Building Blocks What are SMOs
- 27. Page 27 | Confidential and Proprietary Information • Serve the public interest • Drive adoption and implementation of international standards • Clarify • Reflect international good practice • Increase effectiveness of IFAC Compliance Program Why Revise? 2004 vs. 2012 SMOs
- 28. Page 28 | Confidential and Proprietary Information • Shall = requirement • Applicability Framework • Comply or explain • Best endeavors • Compliance Program Key Concepts SMOs
- 29. Page 29 | Confidential and Proprietary Information Understanding Diversity Key Concepts Regulatory frameworks Sectors of profession Different degree of responsibility
- 30. Page 30 | Confidential and Proprietary Information Degree of responsibility for an SMO area Direct Shared No Responsibility Implement all the requirements of the SMO In exceptional situations departures are possible if can be justified from the public interest perspective and need to be documented For the elements for which Member Body has direct responsibility follow the approach for "Direct" AND For the elements for which Member Body has no direct responsibility follow the approach for "No Responsibility " Use best endeavors to: a. Encourage those responsible for the requirements to follow this SMO in implementing them; AND b. Assist in the implementation where appropriate SMO Applicability Framework
- 31. Page 31 | Confidential and Proprietary Information IFAC Compliance Assessment Requirements and Application Guidance Applicability Framework Scope Obligation Structure of the SMOs Revised SMOs
- 32. Page 32 | Confidential and Proprietary Information Adoption SMOs 2, 3, 4, 5, 7 Decision Action to make the decision effective
- 33. Page 33 | Confidential and Proprietary Information Adoption Transposition Different Approaches – One Goal SMOs 2, 3, 4, 5, 7
- 34. Page 34 | Confidential and Proprietary Information Education and training Raising awareness Dissemination of standards Implementation guidance Implementation SMOs 2, 3, 4, 5, 7
- 35. Page 35 | Confidential and Proprietary Information • Assess priorities and challenges • Is there a need of translation to ensure proper adoption and implementation • Process for timely, accurate and complete translation Translation SMOs 2, 3, 4, 5, 7
- 36. Page 36 | Confidential and Proprietary Information Extension of the scope to ALL audits of financial statements (priority for PIE audits) Consider QA performed by another authority to avoid overlap Ensure sufficient resources Refer to I&D if no corrective action Consideration of public oversight Review of implementation and effectiveness Quality Assurance SMO 1
- 37. Page 37 | Confidential and Proprietary Information • Review and understand revisions • Consider actions necessary to address revisions • Plan and execute actions • Cooperate within RO/AG • Reflect actions in the next update of the SMO Action Plan What PAOs Need To Do Revised SMOs
- 38. Page 38 | Confidential and Proprietary Information Strong Global Accountancy Profession It All Fits Together
- 39. Page 39 | Confidential and Proprietary Information Why Quality Assurance? Internal Quality Controls External Quality Assurance Reviews Confidence Credibility Reputation Quality Assurance
- 40. Page 40 | Confidential and Proprietary Information • Protects public interest • Enhances reputation • Reduces risk of errors and omissions • Reflected in enhanced service to clients • Improves the standard of audit work • Generates referrals for new business • Increases profits • Meets regulatory requirements Benefits Quality Assurance
- 41. Page 41 | Confidential and Proprietary Information Scope • Consider efficiency & don’t reinvent the wheel • ALL audits of financial statements – But priority to PIEs’ audits • Other services? • Mandatory or voluntary? • Criteria & risk factors Quality Assurance
- 42. Page 42 | Confidential and Proprietary Information • ISQC 1 • ISA 220 • Guidance – Awareness building – Manuals – CPD – Start small (voluntary programs) • Trust the market and play to the market Quality Control Standards & Guidance Quality Assurance
- 43. Page 43 | Confidential and Proprietary Information • Subject – Firm or engagement partner • Criteria – Suitable – Respectful of and aligned with the national regulatory framework – What needs to be considered to conclude that the QC system is adequate and the firm/partner complies • Guidance – Awareness building – Manuals – CPD – Start small (voluntary programs) • Trust the market & play to the market Design Quality Assurance
- 44. Page 44 | Confidential and Proprietary Information • Cycle approach • Risk-based approach • Mixed approach • Other considerations Review Cycle Quality Assurance
- 45. Page 45 | Confidential and Proprietary Information • Procedures • Documentation • Quality – Resources – Skills & competence – Quality of team leader – Ethical requirements • Confidentiality Review Team Quality Assurance
- 46. Page 46 | Confidential and Proprietary Information • Conclusion – Is the firm’s system designed to meet requirements? – Is the partner subject to the system? – Does the firm/partner comply with internal QC system? • Reasons for conclusion • Recommendations for improvement • What if the review was unsatisfactory? Reporting & Corrective Actions Quality Assurance
- 47. Page 47 | Confidential and Proprietary Information • IFIAR principles • Cooperate closely & share information and expertise • Consider how to contribute to the regulation of the profession • IFAC PPP 1, Regulation of the Accountancy Profession Public Oversight Considerations Quality Assurance
- 48. Page 48 | Confidential and Proprietary Information Review of Implementation and Effectiveness Quality Assurance Consider Plan ExecuteReview Improve
- 49. Page 49 | Confidential and Proprietary Information • Rwanda • Malta • Bahamas • Poland Examples from Around the World Quality Assurance
- 50. Page 50 | Confidential and Proprietary Information Quality in the performance of Auditing Engagements by ICPAR members is the goal of the Audit Quality Review Programme. The Programme seeks to achieve its goal through education and remedial, corrective actions. This goal serves the public interest and, at the same time, enhances the significance of ICPAR membership. The Programme is based on the principle that a systematic monitoring and educational process is the most effective way to attain and maintain the envisaged quality of professional work throughout the profession. Thus, it depends on mutual trust and cooperation. The reviewed practice unit is expected to take appropriate actions in response to deficiencies in either design of its system of quality control, or its compliance with that system, or both. These actions will be positive and remedial. Matters touching on the professional conduct of a member will be investigated within the Disciplinary Process as provided for in the Laws of the Land. Rwanda Examples from Around the World
- 51. Page 51 | Confidential and Proprietary Information Malta Examples from Around the World
- 52. Page 52 | Confidential and Proprietary Information
- 53. Page 53 | Confidential and Proprietary Information Feedback from Firms • I would also like to take this opportunity to thank both of you for the professional but friendly way you approached our visit and your practical findings which will enable us to focus on our weaknesses in the practice so that they can be rectified to bring all areas up to the required standard • In the meantime, we would like to thank you for the professional and courteous manner in which you carried out the review and for your honest and open approach. Your review has proved to be very constructive and has outlined valid improvements that need to be made in our quality control procedures Quality Assurance
- 54. Page 54 | Confidential and Proprietary Information Feedback from Firms cont. • We would like to thank you for your very helpful and constructive comments during your visit which we found to be a very productive review and a useful process carried out in a supporting manner • It is very encouraging to see that the BICA are using monitoring compliance officers who are realistic and understanding in their approach and have good solid actual background practice experience and appreciate more fully the real life problems and difficulties facing practitioners Quality Assurance
- 55. Page 55 | Confidential and Proprietary Information Free Tools and Resources How IFAC assists
- 56. Page 56 | Confidential and Proprietary Information Free Tools and Resources • www.ifac.org/SMP • web.ifac.org/clarity-center/index • www.ifac.org/ComplianceProgram • www.ifac.org/about-ifac/professional-accountancy- organization-development-committee • www.ifac.org/Ethics/Resources.php • www.ifac.org/Translations • www.ifac.org/issues-insights/public-policy-regulation How IFAC Assists?
- 57. Page 57 | Confidential and Proprietary Information THANK YOU www.ifac.org/ComplianceProgram www.ifac.org
Notas del editor
- Solid craftsmanship based on education, experience, examination, values
- Flexibility for adaptation is one of the best sustainable characteristics of a building. Besides this the award winning Sky Village project for Copenhagen building will also integrate the latest technologies according to the progressive Danish environmental standards.
- The annual balance sheet of a Sumerian state-owned farm, drawn up by the scribe responsible for artisans: detailed account of materials and workdays for a basketry workshop.
- The timeswe live in are no doubt VERY interesting…
- But being part of the accountancy profession we have the tools to bring clarity to today’s complex world
- Policy Position Paper 1 emphasizes best practicein the design and implementation of regulation. An understanding of the characteristics and operations of the market is essential (market size, business diversity, economic factors, consumers, etc.). Care needs to be taken that the nature and characteristics of the operation of the market are well understood; otherwise, the regulation may not achieve its purpose. To be effective, IFAC believes that regulation should reflect six qualities: (i) transparent; (ii) proportionate; (iii) targeted; (iv) non-discriminatory; (v) implemented fairly and consistently; and (vi) subject to regular review.Regulation should aim to ensure that the quality of services provided by the profession responds effectively and efficiently to the demands of the economy and society.It must be designed to take into consideration the shocks and stresses that may occur in different economic conditions.
- Global organization for the accountancy professionComprised of 173 Members and Associates in 129 countriesMembers and Associates are Professional Accountancy OrganizationsRepresents 2,5 millions accountants in public practice, business, government, and academiaThe color may be uniform but there are different ways to effectively organize the profession, different legislative frameworks, different stakeholder expectations and capacity Green – membersYellow – associates onlyGrey – no IFAC representation
- Let’s start by looking at what are the SMOs. They are embedded in the IFAC Constitution and in the first instance apply to all IFAC members and associates. In a sense they are international “soft law” but for IFAC members and associates SMOs
- But more broadly, the SMOs are globally recognized as a clear benchmark for strong accountancy profession.
- The 7 Statements of Membership Obligations (SMOs) serve as the basis for the IFAC Member Body Compliance Program and provide clear Framework for strong and high quality Professional Accountancy Organizations (PAOs). The SMOs are also globally recognized as the benchmark for PAOs as they work, in the public interest, to develop, continuously improve and monitor high quality professional accountants. Of course for the PAOs to be strong they need sound governance framework. While there is no SMO on Governance IFAC has some guidance and soon we will issue a refreshed version on it.As you see,we can think about the SMOs in terms of building blocks for constructing strong PAOs. First, solid PAO needs a good base of education; then come technical standards, IFRSs, ISAs, public sector accounting standards, but the whole house is kept together by a cornerstone of Ethics. All of us are simply human and, therefore, require guidance on what is right or wrong. But also because we are human, we need solid systems of external quality assurance and if wrongdoing is reported or suspected – an unbiased investigation and disciplinary system.
- So, why did IFAC decide to revise the SMOs in 2012? Under the oversight of the Compliance Advisory Panel and PIOB.Serve the public interest: to reflect the context of developments in international standards and today’s regulatory environment, to also reflect the expectation of the accountancy profession held by the public and key stakeholders.Clarify the SMOs: to ensure that the SMOs continue to be an effective framework for credible and high quality PAOs.To further drive adoption and implementation as clearly mandated in the IFAC strategy Changes were made to the structure of the SMOs to (A) ease the understanding of the SMOs, and (B) to add new requirements to reflect current international best practice.Presentation will cover a description of both elements of the revised SMOs.
- Let’s look at the next piece of the puzzle and consider what are the key concepts of the SMOs.Use of “shall” to identify requirementsUnderstanding diversity – Applicability FrameworkComply or explain - when PAO has responsibilityBest endeavors – when PAO has no responsibilityIFAC Member Body Compliance Program
- Probably one of the most important concepts underlying the SMOs is appreciation and understanding that PAOs are all very different.
- What you see on this slide is the clarified applicability framework. It is included at the very beginning of each SMO to guide PAOs what actions they have to take to satisfy SMO requirements depending on how much responsibility they have for each of the seven SMO areas.For example, if you have direct responsibility for setting auditing standards, then to comply with the SMO 3, you have to adopt and implement the ISAs and if something prevents you from doing it, you have to provide satisfactory explanation.On the other hand, if you have no responsibility for setting accounting standards for the public sector, then to comply with SMO 5, you should use your best endeavors to promote the IPSASs to the government and offer your assistance for example to organize training for government accountants.Now on to the main requirements.
- To further help PAOs in understanding the SMOs, we have improved and streamlined the structure of the SMOs.Each SMOs starts with clear reference to the obligations enshrined in the IFAC Constitution.It then identifies the scope of the SMOAnd proceeds to set out the applicability framework that we have just discussedAfter setting the scene, each SMO sets out relevant requirements and application guidanceFinally, each SMO concludes by indicating how IFAC approaches the assessment of each member and associate compliance with the SMO
- Adoption consists of two key steps: (i) the decision that the international standard is appropriate for the jurisdiction, and (ii) the actions necessary to make that decision effective.
- Depending on legal and regulatory framework and other jurisdiction-specific factors, adoption can take many different forms, including: requiring use of the international standards, as set by law or regulation; incorporating or transposing international standards into existing national requirements;establishing a convergence process, bringing together national and international standards to minimize and/or eliminate differences; oreliminating major departures from international standards through harmonization of national requirements with international standards.
- Implementation includes a range of activities that ultimately raise awareness of the standards and build understanding regarding their use in practice by individual practitioners. In addition to promoting and disseminating the standards, actions supporting implementation include design and delivery of related education, training, and practical guidance materials.
- Translation can also be a core element of effective implementation. In jurisdictions where English is not the official language, the responsible entity should consider their priorities and determine the impact of translation on proper adoption and implementation. Where it is deemed relevant, a process for timely, accurate, and complete translation should be established.
- To assist you in understanding the revisions and your considerations on what changes need to be addressed, we have prepared a range of tools that will be made available on the IFAC website after the Council ratifies the SMOs. The main tool is the Revised SMO Comparison Guide that includes: a) Summaries of major revisions to each SMO as compared to the previous SMOs issued in 2004,b) Full text of the revised SMOs with: - Paragraph references mapping it to the previous version of the SMOs Notes indicating the nature and the objective of the changes, if any, made to the paragraph.In addition, to the comparison guide, and if you will want to know more detailed information, we have also prepared and will make available:A document summarizing significant issues raised in the exposure process and conclusions reached by the CAPDetailed mark-up document from original to revised SMOs.And, of course, as always you can reach out to the IFAC staff in case you will have any further questions or required some additional clarifications.We also think about organizing learning workshops alongside events organized in the regions. We want to make use of webinar technology to organize virtual learning opportunities. And last, but not least, we want to leverage our relationships at global, regional and national level to progress our vision of global adoption and implementation of international standards.
- Before we will start the more exciting part of this afternoon and have more hands-on discussion about what the SMOs mean for each of you, I would like to finish my remarks by emphasizing that the Vision of the Compliance Program is one of encouragement and improvement. The Program strive to influence agendas and actions towards global adoption and implementation of the international standards, but we can only do that by partnering with you as IFAC members and associates. Since 2004, when the program was established, you – IFAC Member Bodies – have taken the lead and continue to demonstrate the commitment to building strong and high quality professionals. We are confident, that with your ongoing commitment and the support of our partners, we will continue on the road to building strong and high quality PAOs around the world for the benefit of public interest and sound and sustainable economies.
- Enhances reputationReduces risk of errors and omissionsReflected in enhanced service to clientsGenerates referrals for new businessIncreases profitsMeets regulatory requirements
- Improves the standard of audit workEnhances reputation of auditors and PICPAEnables PICPA to discharge its membership obligations to IFAC (SMO 1 – Quality Assurance) Protects the public interestEncourages inward investment by increasing confidence in audited financial statements
- Undertaken in accordance with IFAC SMO 1Covers compliance with International Standard on Quality Control No.1 (ISQC1) and International Auditing Standards (ISAs) ISQC 1: Firm-level review of its quality controls and proceduresISAs: Engagement reviews of each audit principalEngagement reviews will be undertaken at the same time as firm level reviews