The IFAC Council approved full member status for the Association of Accounting Technicians (UK) and the Mongolian Institute of Certified Public Accountants, and welcomed six organizations as new associates: the Albanian Institute of Certified Accountants, the Association of National Accountants of Nigeria, the Institute of Professional Auditors (Russia), the Ordre National des Experts Comptables et des Comptablies Agréés du Togo, the Institute of Certified Public Accountants of Rwanda, and the Ordem Dos Tecnicos Oficiais dos Contas (Portugal). In addition, Recognized Regional Organization status was granted to the Pan African Federation of Accountants.

 

 

 

The Notice of the Call for Nominations for Boards and Committees in 2014, along with its companion guide, Developing a Nominations Strategy, contain strategic and practical advice for nominating organizations and individuals, allowing them to make more informed decisions in their selections and to understand the requirements and expectations of nominees. Each year, approximately one-third of the 155 positions on the boards and committees have openings, though serving members may be reappointed for some of those positions. The Nominating Committee follows an open and transparent process in selecting the best candidates for the available positions, while also aiming to achieve gender, regional, and professional balance. All vacancies on the independent standard-setting boards are open for nominations by the public including, for the first time, the International Public Sector Accounting Standards Board. The official Call for Nominations for Boards and Committees in 2014 will be issued on January 15, 2013, and nominations may be submitted from January 15 to March 15, 2013.

 

 

 

The IFAC International Gold Service Award was presented to Professor Mervyn King SC in honor of his substantial contributions to corporate governance and integrated reporting. In particular, in his role as chair of the King Committee on Corporate Governance in South Africa, Mr. King has demonstrated extraordinary foresight and dedication, pioneering the drafting of the international benchmark for corporate governance guidelines known as King I (now King III), which have been lauded for their inclusive and integrated approach. King now presides at the center of the integrated reporting movement, chairing the International Integrated Reporting Council (IIRC), which has been charged with drafting an internationally accepted integrated reporting framework. Prior to the IIRC’s formation, King led the accelerated development of such a framework for South Africa, when the country, in 2010, became one of the first in the world to require publicly listed companies to produce integrated reports.

 

 

 

As part of the IFAC Council Meeting, IFAC’s strategic plan for 2013-16 was approved. The theme of the plan, Leading the Way, signifies IFAC’s intent to solidify its position as the global voice of the accountancy profession and to take on an increased leadership role on key global initiatives. The plan highlights IFAC’s responsiveness to the major global regulatory shifts that will continue to shape the profession in the coming years. IFAC will continue to focus on its core activities: development, adoption, and implementation of high-quality international standards. In addition, it will continue its focus on improved public sector financial reporting and integrated reporting, and enhance its focus on regulation and public policy. It will also continue to take an inclusive approach, with an emphasis on capacity building. And finally, it will pursue a sustainable funding model.

 

 

 

At the recent IFAC Council meeting, Warren Allen (New Zealand) was elected president, succeeding Göran Tidström, and Olivia Kirtley (US) was elected deputy president. Additionally, six new members were elected to the IFAC Board: Carol Bellringer (Canada), Norunn Byrkjeland (Norway), Dr. Yugui Chen (China), Pamela Monroe Ellis (Jamaica), Dr. In-Ki Joo (South Korea), and Russell Loubser (South Africa). The Council also re-elected Jacques Potdevin (France) and Marta Rejman (UK).

 

 

 

IFAC welcomed the recent release of the International Monetary Fund (IMF)’s paper, Fiscal Transparency, Accountability, and Risk. The paper highlights the seriousness and extent of the current inadequacies in governments’ fiscal reporting and accountability, and underscores the immense risks associated with these shortcomings. In particular, IFAC welcomes the IMF’s support for the International Public Sector Accounting Standards, the globally accepted, high-quality accrual-based standards issued by the International Public Sector Accounting Standards Board (IPSASB), an independent standard-setting body. These standards promote greater transparency and accountability in public sector finances and allow for enhanced monitoring of governments’ fiscal positions.

 

 

 

IFAC has released the Statements of Membership Obligations (SMOs) 1-7 (Revised), which form the basis of the IFAC Member Body Compliance Program and serve as benchmarks for developing the accountancy profession and promoting the value of professional accountants worldwide. The SMOs were revised with input from IFAC members, associates, and other external stakeholders. The revisions clarify member bodies’ obligations when they have varying degrees of responsibility, enhance the description of the best endeavors concept, and align with IFAC’s strategic focus on adoption and implementation of international standards and current practices for quality assurance and investigation and discipline. IFAC technical staff has also developed A Comparison Guide to the 2012 SMO Revisions, which provides further explanation of the revisions and serves as a tool for IFAC member organizations to identify and understand the revisions.

 

 

 

Are you a practitioner operating in a small- or medium-sized practice (SMP)? If so, make sure your voice is heard by taking the November/December 2012 IFAC SMP Quick Poll. Intended to take a snapshot of the key issues confronting SMPs and their small- and medium-sized entity (SME) clients, this edition of the poll is being conducted in 17 languages thanks to the generous translation support provided by SMP Committee members and IFAC member organizations. The semi-annual poll only takes three minutes to complete and will close on December 31, 2012. Look for the results in the next issue of the SMP eNews (register and subscribe here). Results from previous editions of the poll are available on the IFAC website.

 

 

 

The staff of the International Ethics Standards Board for Accountants (IESBA) has released additional questions and answers (Q&As) to support the adoption and implementation of the IESBA’s Code of Ethics for Professional Accountants (the Code). The new Q&A covers issues related to materiality, partner rotation, public interest entities, and network firms. To aid consistent application of the Code, the IESBA monitors the adoption and implementation of the Code to identify areas where support is needed—these Q&As respond to identified needs.

 

 

 

IFAC Chief Executive Officer Ian Ball’s latest Public Finance International blog, “Government Accounts: clear and present danger”, has been published. This edition of the blog focuses on the International Monetary Fund’s (IMF) paper-Fiscal Transparency, Accountability, and Risk.

 

 

• Danish—International Standard on Assurance Engagements (ISAE) 3420, Assurance Engagements to Report on the Compilation of Pro Forma Financial Information Included in a Prospectus (2011), International Standard on Related Services (ISRS) 4410 (Revised), Compilation Engagements (2012)

• French—International Framework for Assurance Engagements (2012)

• German—International Framework for Assurance Engagements (2012)

• Italian—Guide to Practice Management for Small- and Medium-Sized Practices, Second Edition (2011)

• Spanish—International Education Standards 1-6, 8 (2011), IAASB Strategy and Work Program, 2012–2014 (2012), Feedback Statement: The Evolving Nature of Financial Reporting: Disclosure and Its Audit Implications (2012), Helping Small- and Medium-Sized Practices Meet the Challenges and Seize the Opportunities of Tomorrow (2012)

 
 

 

1. Arnold Schilder Presents Directions in Auditing and Assurance: Challenges and Opportunities at Australian Auditing and Assurance Standards Board Seminar, Melbourne, Australia
 

International Auditing and Assurance Standards Board (IAASB) Chairman Prof. Arnold Schilder was a guest speaker at a seminar in Melbourne, Australia, hosted by the Australian Auditing and Assurance Standards Board. His presentation, Directions in Auditing & Assurance: Challenges and Opportunities, focused on the impact of the global environment on the relevance of an audit, and included the response of the IAASB to these challenges. Specific topics included the IAASB’s Invitation to Comment on auditor reporting, the IAASB’s projects on audit quality and disclosures, and alternatives to audits aimed at meeting the needs of small- and medium-sized entities.

Open Consultations and Exposure Drafts

 

The International Auditing and Assurance Standards Board (IAASB) has released for public comment proposed International Standard on Auditing (ISA) 720 (Revised), The Auditor’s Responsibilities Relating to Other Information in Documents Containing or Accompanying Audited Financial Statements and the Auditor’s Report Thereon.
 

The proposed standard clarifies and enhances the scope and focus of auditor efforts on “other information”—that is, information included in documents containing or accompanying the entity’s audited financial statements. The proposals recognize that significant changes in financial reporting have occurred over the last two decades regarding the information issued in connection with an entity’s financial statements and the manner in which it is shared with users. Comment Deadline: March 14, 2013

 

The International Accounting Education Standards Board (IAESB) has released proposed revisions of International Educations Standards (IES) 8, Professional Development for Engagement Partners Responsible for Audits of Financial Statements, which is part of a project to improve the clarity of the IAESB’s eight standards. Each standard addresses an aspect of developing the technical competence, professional skills, and professional values, ethics, and attitudes of an aspiring professional accountant or aspiring engagement partner. Comment Deadline: December 11, 2012

 

The International Ethics Standards Board for Accountants (IESBA) has released Responding to a Suspected Illegal Act, which addresses a professional accountant’s responsibilities regarding the disclosure of suspected illegal acts committed by a client or employer. The proposals describe the circumstances in which a professional accountant is required or expected to breach confidentiality and disclose the act to an appropriate authority. The IESBA proposes adding two new sections addressing illegal acts to the Code of Ethics for Professional Accountants—one each for professional accountants in public practice and in business—and several revisions to other related sections. Comment Deadline: December 15, 2012

 

The International Public Sector Accounting Standards Board (IPSASB) recently released two Exposure Drafts—Conceptual Framework Exposure Draft (ED) 2, Conceptual Framework for General Purpose Financial Reporting by Public Sector Entities: Elements and Recognition in Financial Statements and Conceptual Framework Exposure Draft (ED) 3, Measurement of Assets and Liabilities in Financial Statements.

Both EDs are related to the IPSASB’s project to develop a Conceptual Framework for the general purpose financial reporting of public sector entities. ED 2 proposes definitions of eight elements—assets, liabilities, revenue, expenses, deferred inflows, deferred outflows, ownership contributions, and ownership distributions—and considers how to deal with the uncertainty that can arise over the existence and measurement of elements. ED 3 identifies the measurement concepts that should guide the IPSASB in the selection of measurement bases for International Public Sector Accounting Standards. It stresses the importance of selecting measurement bases that meet the objectives of financial reporting decision making and accountability. Comment Deadlines: April 30, 2013

 

The proposed Professional Accountants in Business Strategy (PAIB) and Work Plan for 2013-2016 outlines specific initiatives to improve recognition of the diverse roles professional accountants in business perform and how they need to be positioned to drive successful and sustainable organizations. As professional accountants in business make up more than half of all accountants in the world, they have the collective power to significantly influence their organizations in implementing effective governance and an ethical culture supported by integrated risk management and internal control, sustainable leadership, and effective reporting and performance management. Comment Deadline: January 31, 2013

The Professional Accountants in Business (PAIB) Committee’s proposed principles-based International Good Practice Guidance, Project and Investment Appraisal for Sustainable Value Creation, will help the accountancy profession to facilitate sustainable organizations, financial markets, and economies by taking into account economic, environmental, and social considerations for project appraisal and investment decisions. The guidance sets out the critical role professional accountants in business play in advising on the application of financial principles and theory. Comment deadline: February 29, 2012