Transcript Document

OVERVIEW
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•
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•
“Scandals” or media beat ups?
Crisis or blessing?
The United States
Australia –
how does the Australian system work?
• What responses have we seen in Australia?
• Just in time – a real-time update
Yes, it is the end of a boom
cycle, but it seems much
worse because more
shareholders are affected.
In Australia over 50% of the
population hold shares.
“Rules, excessively
written, can encourage
avoidance and an attitude
of ‘show me where it says
you can’t do it’”.
Australian Prime Minister
John Howard
The Australian system
STANDARD-SETTING
REGULATION
GOVERNMENT
ACCOUNTING
FRC
Financial
Reporting
Council
CALDB
Companies
Auditors and
Liquidators
Disciplinary
Board
ASIC
Australian
Securities and
Investments
Commission
AUDIT
AuASB
Australian Auditing and
Assurance Standards
Board
ASX
Australian
Stock
Exchange
AASB
Australian Accounting
Standards Board
UIG
Urgent Issues
Group
PROFESSIONAL BODIES - ICAA & CPA
AARF
Australian Accounting
Reserch Foundation
REGULATION
CALDB
Companies Auditors and
Liquidators Disciplinary
Board
The CALDB takes
disciplinary action against
registered company
auditors and liquidators
that have acted in a
manner that does not
uphold the standards
expected of their
profession. These actions
include the cancelling of a
person's legal entitlement
to act as a registered
company auditor or
liquidator.
ASIC
Australian Securities
and Investments
Commission
ASIC enforces company
and financial services laws
to protect consumers,
investors and creditors.
ASIC regulates and informs
the public about Australian
companies, financial
markets, financial services
organisations and
professionals who deal and
advise in investments,
superannuation, insurance,
deposit taking and credit.
Given its enforcement role,
ASIC is sometimes referred
to as 'the corporate cop'.
ASX
Australian
Stock
Exchange
ASX operates Australia’s
primary national stock
exchange for equities,
derivatives and fixed
interest securities. It
also provides comprehensive market data and
information to a range of
users. In 1998 it became
a listed company, which
meant that ASX shares
are listed for trading on
ASX's own market.
STANDARD-SETTING
FRC
Financial Reporting
Council
AASB
Australian Accounting
Standards Board
UIG
Urgent Issues
Group
AuASB
Australian Auditing and
Assurance Standards
Board
AARF
Australian Accounting
Reserch Foundation
The FRC is the peak body responsible for the broad oversight of the accounting
standard setting process for the private and public sectors. Key functions of the
FRC are to advise the Government on the accounting standard setting process and
the development of international accounting standards.
The AASB is the technical body responsible for the development and approval of
Australian Statements of Accounting Concepts (SACs) and Australian Accounting
Standards (known as the AASBs) which have the force of law. The Board releases
exposure drafts (for proposed new standards) to elicit feedback from financial
reporting constituents.
The UIG is a committee of the AASB. Its role is to provide timely guidance on urgent
financial reporting issues prevent unsatisfactory reporting practices.
The role of the AuASB is to develop high quality professional standards and
related guidance for auditors and providers of other assurance services, as a
means to enhance the relevance and reliability of information provided to users of
Auditing & Assurance services.
The AARF was established jointly by the Institute and CPA Australia. Since 2000, the
AARF has acted as the technical research engine of the Auditing & Assurance
Standards Board (AuASB) and the Legislation Review Board (LRB).
THE PROFESSIONAL BODIES
The Institute of
Chartered Accountants
in Australia
CPA Australia
Section 297 of the Australian Corporations
and Securities Legislation clearly states:
“The financial statements and notes for a
financial year must give a true and fair view
of the financial position and performance of
the company, registered scheme, or
disclosing entity.”
Key recommendations of the Ramsay Report
• Support ICAA’s FI independence rules (new IFAC
independence guidelines)
• Audit rotation of partners
• Independent public oversight board
• Independent audit committees