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IFAC Update: April 2011
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May 4, 2011
The IFAC Update provides summaries of developments from the International Federation of Accountants (IFAC) and the independent standard-setting boards it supports over the past month.
IFAC News in Brief
1. New Exposure Drafts Issued by IAASB, IAESB, IPSASB, and PAIB Committee
2. Research Projects Designed to Inform IAESB Completed
3. Kreston International Joins the Forum of Firms
4. Updated IPSASB Handbook Released
5. SMP Quick Poll: Make Your Views Count!
Open Consultations and Exposure Drafts
1. IAASB Exposure Drafts and Consultation Papers
? International Standard on Review Engagements (ISRE) 2400, Engagements to Review Historical Financial Statements—Comment Deadline: May 20, 2011
? The Evolving Nature of Financial Reporting: Disclosure and Its Audit Implications—Comment Deadline: June 1, 2011
? International Standard on Assurance Engagements (ISAE) 3410, Assurance Engagements on Greenhouse Gas Statements—Comment Deadline: June 10, 2011
? International Standard on Assurance Engagements (ISAE) 3000, Assurance Engagements Other Than Audits or Reviews of Historical Financial Information—Comment Deadline: September 1, 2011
2. Proposed IFAC Member Body Compliance Program Strategy 2011-2014—Comment Deadline: May 30, 2011
3. IPSASB Exposure Drafts and Conceptual Framework Documents
? Conceptual Framework for General Purpose Financial Reporting by Public Sector Entities: Role, Authority, and Scope; Objectives and Users; Qualitative Characteristics; and Reporting Entity—Comment Deadline: June 15, 2011
? Elements and Recognition in Financial Statements—Comment Deadline: June 15, 2011
? Measurement of Assets and Liabilities in Financial Statements—Comment Deadline: June 15, 2011
? Exposure Draft 45, Improvements to IPSASs 2011—Comment Deadline: June 30, 2011
? Key Characteristics of the Public Sector with Potential Implications for Financial Reporting—Comment Deadline: August 31, 2011
4. IAESB Exposure Drafts
? International Edu-cation Standard 4, Professional Values, Ethivs and Attitudes—Comment Deadline: July 15, 2011
? International Education Standard 6, Assessment of Professional Competence—Comment Deadline: July 28, 2011
5. PAIB Committee Predictive Business Analytics Exposure Draft—Comment Deadline: July 29, 2011
IFAC News in Brief
1. New Exposure Drafts Issued by IAASB, IAESB, IPSASB, and PAIB Committee
2. Research Projects Designed to Inform IAESB Completed
Research projects designed to inform the International Accounting Education Standard Board (IAESB)’s standard-setting agenda in the area of professional accountancy education have been completed. The four projects, chosen out of 29 research proposals, focused on access to continuing professional development in the Asia Pacific region; ethical awareness of practicing professional accountants; good practices in non-technical skills; and IESs 2, 3, and 4. The research projects were sponsored by the International Association for Accounting and Education Research (IAAER) and the Association of Chartered Certified Accountants (ACCA). For more information on the completed projects, please see Informing the International Accounting Education Standards Board: A Summary of IAAER/ACCA Research Projects, available through the IAESB website.
3. Kreston International Joins the Forum of Firms
International network of accounting firms Kreston International has been admitted as a full member of the Forum of Firms. Membership was granted after confirmation that Kreston met the Forum’s membership standards, including implementation of a globally coordinated quality assurance program, policies and methodologies based on the International Standards on Auditing (ISAs), and other specific requirements of the Code of Ethics for Professional Accountants. For additional details on the Forum of Firms, please visit www.ForumofFirms.org. Read the full press release in the Media Center on IFAC’s website.
4. Updated IPSASB Handbook Released
The 2011 Handbook of International Public Sector Accounting Pronouncements has been released by the International Public Sector Accounting Standards Board (IPSASB). In two volumes, the Handbook contains all current IPSASB pronouncements, including accrual-based standards and the IPSASB's cash-basis standard. The 2011 Handbook incorporates the amendments made as a result of the IPSASB’s 2010 Improvements Project, as well as a history of the amendments made to that standard at the beginning of each accrual-based standard.
5. SMP Quick Poll: Make Your Views Count!
Are you a practitioner in a small- or medium-sized (SMP) practice? Join the dialogue on current challenges and issues faced by SMPs by taking the SMP Quick Poll. The survey should only take three minutes to complete, and the results will be highlighted in the next issue of SMP eNews. The survey will close on May 18, 2011.
Open Consultations and Exposure Drafts
1. IAASB Invites Comment on Recently Proposed Exposure Drafts and Consultation Papers
The International Auditing and Assurance Standards Board (IAASB) recently released the following:
? International Standard on Review Engagements (ISRE) 2400, Engagements to Review Historical Financial Statements, addresses the growing international need for robust standards for services that can be used by entities, especially SMEs, that are either not required or do not elect to be audited. Comment Deadline: May 20, 2011
? The Evolving Nature of Financial Reporting: Disclosure and Its Audit Implications, a discussion paper and thought piece, discusses key issues relating to disclosures in financial statements, highlights recent trends in the range, volume, and complexity of financial statement disclosures, and explores issues and practical challenges in preparing, auditing, and using them. Comment Deadline: June 1, 2011
? International Standard on Assurance Engagements (ISAE) 3410, Assurance Engagements on Greenhouse Gas Statements, addresses the practitioner’s responsibilities in identifying, assessing, and responding to risks of material misstatement, and contains illustrative assurance reports on greenhouse gas statements. Comment Deadline: June 10, 2011
? International Standard on Assurance Engagements (ISAE) 3000, Assurance Engagements Other Than Audits or Reviews of Historical Financial Information, a principles-based standard that can be applied effectively to a broad range of assurance engagements, ranging from assurance on statements about the effectiveness of internal control to direct engagements, such as performance or “value for money” audits, to possible future engagements addressing integrated reporting or corporate social responsibility reporting. Comment Deadline: September 1, 2011
2. IFAC Publishes Proposed Member Body Compliance Program Strategy 2011-2014
The Compliance Advisory Panel (CAP) has released for comment the Proposed Member Body Compliance Program Strategy 2011-2014. The paper was drafted as a result of the strategic discussions held between the CAP, IFAC member body development staff, and Public Interest Oversight Board (PIOB) representatives in October 2010 and January 2011. The discussions were based on the CAP self-assessment, submitted as part of the 2009-2010 Monitoring Group’s review of the IFAC Reforms, as well as comments from the Fifth Public Report of the PIOB in May 2010. Comment Deadline: May 30, 2011
3. IPSASB Publishes Exposure Drafts and Proposed Conceptual Framework Documents
The International Public Sector Accounting Standards Board (IPSASB) issued an exposure draft and two consultation papers related to its project to develop a Conceptual Framework for the general purpose financial reporting of public sector entities. Summaries of the consultation papers can be found in the “At a Glance” publications, which have been posted along with the consultation papers. Comment Deadline: June 15, 2011
? Conceptual Framework for General Purpose Financial Reporting by Public Sector Entities: Role, Authority, and Scope; Objectives and Users; Qualitative Characteristics; and Reporting Entity proposes that the objectives of financial reporting should be to provide information for accountability and decision-making purposes.
? Elements and Recognition in Financial Statements identifies alternative asset and liability-led and revenue and expense-led approaches to financial statements and considers the key characteristics of assets, liabilities, revenue, and expenses.
? Measurement of Assets and Liabilities in Financial Statements considers the measurement bases that may be appropriate for the elements that are recognized in financial statements.
The IPSASB also recently released the following:
? Exposure Draft 45, Improvements to IPSASs 2011, which proposes the deletion of the Introduction section of each IPSAS where relevant (i.e., 21 of 31 IPSASs); the addition of an Objective paragraph to the four IPSASs that do not currently include an Objective paragraph (IPSASs 6–8 and 10); and improvements to four IPSASs (IPSAS 16, 17, 19, and 21). Comment Deadline: June 30, 2011
? Key Characteristics of the Public Sector with Potential Implications for Financial Reporting provides background on issues affecting the development of a conceptual framework for public sector entities and standard setting. In particular, it highlights that public sector entities are likely to depend upon taxation rather than commercially generated profits for their continued existence—and have governance arrangements that generally involve a legislative body holding an executive to account. The paper is geared toward those who may have limited familiarity with the public sector, particularly those with more experience in financial reporting for the private sector—including not-for-profit entities. Comment Deadline: August 31, 2011
4. IAESB Invites Comment on Proposed Revised, Clarified Education Standards
The International Accounting Education Standards Board (IAESB) has released the following exposure drafts:
? International Education Standard (IES) 4, Professional Values, Ethics, and Attitudes, which proposes the development of professional values, ethics, and attitudes be addressed by learning and development activities that occur throughout the career of the professional accountant. This revision to IES 4 will be helpful to educational organizations, employers, regulators, government authorities, and other stakeholders who support the learning and development of professional accountants. Comment Deadline: July 15, 2011
? International Education Standard 6, Assessment of Professional Competence, will assist professional accountancy organizations to understand both the learning and development requirements for areas of assessment of professional competence, and their obligations in upholding the standard. The revised standard addresses elements that are essential to assessing professional competence over the career of a professional accountant, including proposing:
o a principles-based approach, which specifies the requirements for the assessment of professional competence across the Initial Professional Development (IPD) and Continuing Professional Development (CPD) of a professional accountant;
o principles of individual assessment used by member bodies to assess professional competence—applied across IPD and CPD career stages—that shall be reliable, valid, equitable, transparent, and sufficient; and
o a requirement that IFAC member bodies undertake a formal evaluation of the adequacy of competence of aspiring professional accountants prior to their admission to the profession and have a systematic process to verify whether professional accountants meet CPD requirements.
Comment Deadline: July 28, 2011
5. Predictive Business Analytics Exposure Draft Released by PAIB Committee
New guidance on predictive analytics has just been released by the Professional Accountants in Business (PAIB) Committee. The Predictive Business Analytics: Forward-Looking Measures to Improve Business Performance Exposure Draft, part of the International Good Practice Guidance series, is designed to help professional accountants working in commerce, industry, financial services, education, and the public and not-for-profit sectors, as well as their organizations, embrace predictive analytics to achieve better forward-looking performance insights. Comment Deadline: July 29, 2011
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