News from Member Bodies, Affiliates, and Regional Accountancy Organisations
1. CIPFA Seeks New Chief Executive
The Chartered Institute of Public Finance and Accountancy (CIPFA), the world’s only professional accountancy body exclusively dedicated to public finance, is looking for a new chief executive to address public financial management and governance in the UK and globally.
2. Importance of Ethics Emphasized by ICAG
The importance of ethics to the accountancy profession was emphasized by the president of the Institute of Chartered Accountants Ghana (ICAG), Angela Peasah, to graduating accountancy students. “Keeping the ethics of our profession is not negotiable; if we do not abide by them, then we become a liability,” she said. “As financial gatekeepers we must work to the benefit of society and the organizations we represent.” ICAG also recently launched its golden jubilee 50th anniversary celebration and is hosting the
Second African Congress of Accountants: Africa’s Economic Growth, Accountability, and Democracy, May 14-16, 2013, in Accra, Ghana. It also hosted the IFAC Professional Accountancy Organization Development Committee meeting on May 12-13, 2013.
3. ZICA: Increased Adherence to Good Governance Needed to Enhance Transparency
During a recent interview, Frederick Banda, president of the Zambia Institute of Chartered Accountants (ZICA), stressed the need for the corporate world and other sectors to strictly adhere to good governance practices to enhance transparency. Mr. Banda also said that ZICA believes many of the problems cited in reports from the Zambia Auditor General, including irregularities, fraud, and mismanagement of funds, were largely because of organizations’ failure to adhere to good corporate governance values.
4. CGA-Canada: Overhaul of Canada Capital Cost Allowance System Necessary
The Certified General Accountants Association of Canada (CGA-Canada) recently called for an overhaul of the Capital Cost Allowance system in Canada, calling it too complex. Citing information from a CGA-Canada commissioned study, CGA-Canada said the system needs to be modernized to reduce redundancies and increase efficiencies.
CGA-Canada has also been in the news recently for re-entering unification talks with CPA Canada, the new organization formed by the merger of CGA-Canada and the Canadian Institute of Chartered Accountants.
5. NBA Workshop Series Focuses on Integrity
Integrity in practice will be the focus of a series of regional workshops in June for professional accountants in the Netherlands, held by the Nederlandse Beroepsorganisatie van Accountants (NBA). Topics under discussion will include the overall concept of integrity, managing integrity, compliance and integrity, and results from questions regarding integrity within the NBA’s annual business performance survey of accountants in business.
6. New Thought Piece on Corporate Governance Published by ICAEW
The Institute of Chartered Accountants in England and Wales (ICAEW) has published a new thought piece on corporate governance.
What Should Companies be Responsible for? argues “companies should be sensitive to a full range of responsibilities to get their ‘license to operate’ and help create trust in the market.” Companies are also “fundamentally responsible for achieving a business purpose, behaving [in] a socially acceptable way, complying with law and regulations, and acknowledging and answering for their actions.”
7. CAPA and ICAN Host Public Financial Management Conference
The Confederation of Asian and Pacific Accountants (CAPA) and the Institute of Chartered Accountants in Nepal (ICAN) recently hosted a conference on public financial management to discuss the challenges in reforming and improving public financial management. Strengthening Nepal Public Sector Accounting and Auditing: Building on Experiences featured the secretary for the Minister of Finance, Shanta Raj Subedi, who discussed current reform initiatives in Nepal. “Nepal is committed to adopt and implement cash-based International Public Sector Accounting Standards, and we look forward to hearing the experiences of other countries in their reform and implementation process," he said.
8. ICAC to Include a Focus on Women on Corporate Boards
The upcoming 31st annual conference for the Institute of Chartered Accountants of the Caribbean (ICAC) in June will include a focus on the underrepresentation of women on organization boards, according to Andrew Brathwaite, the chair of the Speakers Committee. Citing the topical nature of the issue, Mr. Brathwaite said, “In the accounting profession, I think the statistics will show that most of our members are actually women. And many of those women occupy senior positions throughout the corporate world. However, the representation of women on boards generally is still extremely low.” Mr. Brathwaite continued, “Having a more gender balanced board results in a more effective board and actually might help to increase the profitability of the company.” The ICAC conference will also include IFAC President Warren Allen as a speaker.
9. New Apprenticeship Program Offered by CIMA
The Chartered Institute of Management Accountants (CIMA), working with the professional education services provider BPP and PwC, will start offering a degree-level apprenticeship in management accounting starting as early as September 2013. The program offers an additional route to qualification, with students studying for the CIMA Certificate in Business Accounting, while gaining wider business training and experience. The program was designed to attract those students who are interested in a career in accountancy but “don’t feel university is for them” and are seeking alternative routes to higher education and employment. CIMA also believes the program will provide a more diverse workforce for businesses. “It is our ambition to make it the norm for school leavers to either go to university or to do an apprenticeship. Higher apprenticeships like this are crucial to making that a reality.”
10. Transparency Awards Recognize Clear, Focused Business Reporting
Plan International Australia and Youth Off The Streets were recently recognized with the PwC Transparency Awards, a collaboration between the Institute of Chartered Accountants in Australia (ICAA), the Centre for Social Impact, and PwC. The awards recognize and encourage “improvement in the quality and transparency of reporting in the Australian Not for Profit sector.” The winners were hailed for reports with clear, focused, and well-articulated goals and business strategy.
11. Recent Member Appointments and Elections
• Mr. Joe Aherne, President, The Institute of Certified Public Accountants in Ireland
• Mr. Cormac Fitzgerald, Vice President, The Institute of Certified Public Accountants in Ireland
• Mr. Brian Purcell, Vice President, The Institute of Certified Public Accountants in Ireland
• Mr. Ronald Alli, President, The Institute of Chartered Accountants of Guyana
• Mr. Colin Thompson, Vice President, The Institute of Chartered Accountants of Guyana
12. Joint Initiatives Launched Among Professional Accountancy Organizations
• A new World Bank-funded initiative targeting public sector accountants is underway by the Institute of Chartered Accountants of Sri Lanka (CA Sri Lanka) under the domain of the Association of Public Finance Accountants of Sri Lanka (APFASL), the public sector wing of CA Sri Lanka. APFASL was created in January 2012 to enhance professional skills and expertise of public sector accountants, auditors, and assessors to improve financial management practices. The new initiative will include Train the Trainers, awareness, and roll-out programs for the Sri Lanka Public Sector Accounting Standards. The Chartered Institute of Public Finance and Accountancy (CIPFA), with whom CA Sri Lanka previously signed a Memorandum of Understanding, will be working closely with CA Sri Lanka to support this initiative and introduce the Chartered Public Finance Accountant qualification to public sector professionals in Sri Lanka.
• The Association of National Accountants of Nigeria and the Institute of Chartered Accountants of Nigeria have announced plans to collaborate and continue to make meaningful contributions to the development of Nigeria and “begin to think of a joint advisory role to government.”
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The recent
2013 North America Top Technology Initiatives survey from the American Institute of Certified Public Accountants and CPA Canada shows that “managing and retailing data” is the top technology concern, followed by “securing the IT environment.”
• The Institute of Chartered Accountants in Australia, Fédération des Experts Comptables Européens (FEE), and the Center for Audit Quality have released Global Observations on the Role of the Audit Committee. The report cites common themes identified over the course of roundtables held around the world on enhancing public company audit committee effectiveness. “Discussions are taking place in every corner of the globe about identifying leading audit committee practices, ensuring greater consistency in the performance of audit committees across the spectrum of public companies, and enhancing transparency about how they meet their obligations to investors.”
News from Government, Regulatory Bodies and Other International Organisations.
1. European Juri Committee Votes in Favor of 14-Year Auditor Rotation
The European Parliament Committee on Legal Affairs (Juri) has voted in favor of auditor rotation every 14 years (with the possibility of an extension to 25 years if member states fulfill certain criteria). The original European Commission plan was rotation on a 6-year basis. The reforms will go before the full European Parliament later this year.
2. Tax, Regulation Complexity Draw North American SMEs to Professional Accountants
Results from the recently conducted Sage
Small Business Accountants Usage 2013 Study show that, in Canada and the US, small- and medium-sized entities (SMEs) who work with outside accountants primarily do so because of the complex nature of tax codes and regulations. Additionally, 55% of respondents agreed or strongly agreed that their outside accountant is “critical to the success of our business.” They survey also includes information on how accountants were located and selected and why outside accountants are not used in some SMEs.
3. Proposed Sustainability Accounting Standards Released by SASB
The Sustainability Accounting Standards Board (SASB) has released a set of proposed sustainability accounting standards for the financial sector. Industries included are: asset management and custody activities, investment banking and brokerage, commercial banking, consumer finance, mortgage finance, security and commodity exchanges, and insurance. The public comment period closes on June 14, 2013.
4. GRI to Host Global Conference, Release G4 Guidelines
The Global Reporting Initiative (GRI) is holding the
Global Conference on Sustainability and Reporting in Amsterdam, May 22-24, 2013. The conference will provide the opportunity to connect, share successful strategies, and collaborate on efforts to build a sustainable global economy. Additionally, the latest evolution of GRI’s Sustainability Reporting Guidelines (G4) will be released at the conference. GRI expects more than 1,500 leaders and practitioners from more than 70 countries, including representatives from business, financial institutions, civil society, international organizations, governments, labor, and academia.
5. International Integrated Reporting Framework Released by IIRC
The
International Integrated Reporting Framework has been released by the International Integrated Reporting Council (IIRC). The Framework is expected to be a critical tool for businesses as they create integrated reports and drive integrated thinking in their organizations. The IIRC is asking all stakeholders to provide feedback on the Framework during its public consultation period, which closes July 15, 2013. The Framework has been released in English but will also be available soon in additional languages. IFAC, a partner in this global effort, encourages all professional accountants to provide feedback.
6. More “Meaningful” Whole of Government Accounts Report Called For
In a recent Public Accounts Committee report, the UK Whole of Government Accounts (WGA) was criticized for a lack of “meaningful” relevance. The WGA was called an “elaborate accounting exercise,” but one with potential for improved relevance and meaning if the Treasury takes stock of “how the full picture could be used to assist the management of public finances.” The report also calls on the Treasury to use the WGA to inform spending decisions, improve the design and layout to enhance comprehension by “lay readers,” and comply with normal accounting rules so all government bodies are included within the WGA. The WGA includes financial information from approximately 1,500 public sector organizations and was first published by the UK in July 2011 (see
August 2011 Global Digest for additional information).
7. Increasing Tolerance of Unethical Behavior Seen in E&Y Survey
According to
Growing Beyond: A Place for Integrity, Ernst & Young’s 12th Global Fraud Survey, almost half of all board members and senior managers across Europe, the Middle East, Africa, and India are aware of financial irregularities within their own financial reports. Irregular financial reporting within their own companies was reported by 42% of respondents and one-fifth of all employees have personally witnessed financial manipulation. The survey reports that risks are on the rise but standards of behavior are not, the control environment is not strong enough, and there is a need for an independent view on compliance. The survey included more than 3,000 employees in 36 countries.
Recent Development Related to the Financial Crisis and Economic Recovery
1. Will 2013 be a “Breakthrough” Year for an EU, Southern Africa Trade Deal?
This year could be a “breakthrough” year for a significant trade deal between the European Union (EU) and nations in Southern Africa, according to the EU Ambassador to Pretoria, Roeland van de Geer. Mr. van de Geer reports that the agreement is within months of being finalized after years of little progress.
2. IMF Warns on Possible “Chronic” Phase of Financial Crisis
The International Monetary Fund (IMF) has issued a warning for the global financial community: excessive risk taking and bank balance sheets that are still broken could prompt a “chronic” new phase in the financial crisis. Although the IMF notes improvements over the last six months, the biannual
Global Financial Stability Report also says improvement can only be sustainable by addressing underlying stability risks and promotion of economic recovery. “Continued improvement will require further balance sheet repair in the financial sector and a smooth unwinding of public and private debt overhangs. If progress in addressing these medium-term challenges falters, risks could reappear. The global financial crisis could morph into a more chronic phase, marked by a deterioration of financial conditions and recurring bouts of financial instability.”