Transcript Strategic Report – [Insert Board/Committee Acronym here]

IFAC Compliance Program –
Adoption and Implementation
of International Standards
Sylvia WY Tsen
Director, Quality and
Member Development
IESBA Meeting
New York, USA
December 12, 2012
Page 1 | Confidential and Proprietary Information
Statements of Membership Obligations (Revised
Nov 2012)
• Acknowledged framework for “Professional accountancy
organization”
– Development agencies (World Bank, etc), governments reforming national
frameworks
– Aspiring IFAC member bodies
• 7 Statements of Membership Obligations (SMOs)
– 5 groups of international standards: IAASB, IESBA, IAESB, IPSASB, IASB
– 2 relating to Quality Assurance and Investigation and Discipline
mechanisms
• Applicability Framework
Page 2 | Confidential and Proprietary Information
SMO Key Concepts – Applicability Framework
Degree of responsibility for an SMO area
Direct
Implement all the
requirements of the SMO
In exceptional situations
departures are possible if
it can be justified from a
public interest
perspective and need to
be documented
Shared
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 "
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
Page 3 | Confidential and Proprietary Information
SMO 4: Key Concepts and Requirements
• MBs shall identify and undertake actions to have the
IESBA Code of Ethics adopted and implemented in their
jurisdictions
• MBs shall notify their members of the new, proposed, and
revised provisions of the IESBA Code of Ethics and other
pronouncements issued by the IESBA.
• MBs are encouraged to comment on IESBA exposure
drafts
• Given the importance of consistent, high-quality ethical
standards, MBs should not apply less stringent standards
than those stated in the IESBA Code of Ethics
Page 4 | Confidential and Proprietary Information
Compliance Program
• Mandatory participation in the Compliance Program
• Action Plan submission: plans to demonstrate ongoing
actions to further SMO requirements
• Based on “Self-Assessments” against SMOs
– Regulatory and standard-setting framework
– Benchmark against SMOs and reference underlying international standard
• Transparency – action plans and self-assessments
published
• Compliance Advisory Panel
• Subject to oversight by PIOB
Page 5 | Confidential and Proprietary Information
SMO 4 and IESBA Code – Adoption Challenges
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•
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•
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Complexity
Other national requirements
Anglo Saxon legal tradition vs local?
Lack of ongoing process for adoption
Quality of adoption process
Translation and dissemination
Recent emphasis on ISA and IFRS adoption
Page 6 | Confidential and Proprietary Information
SMO 4 and IESBA Code – Implementation
Challenges
•
•
•
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Lack of resources to develop tools, resources, implement
Level of development of the accountancy profession
Country-level concepts of “independence”, “objectivity” etc
Education and training
– Curricula
– Case studies and other appropriate education tools
• Investigation and disciplinary processes
Page 7 | Confidential and Proprietary Information
Compliance Program – Strategic Outlook
• Maintaining momentum and credibility of the Compliance
Program
– Monitoring member body action plans
• Request for information on the status of adoption and
implementation of international standards
• How to report on status of adoption and implementation
– Dashboard reports (PFNs)
• Revisions to self-assessment questionnaires
– Types of questions to identify modifications, differences
– Level of detail
Page 8 | Confidential and Proprietary Information
Example of Dashboard Report – Information Gathering for Monitoring
and Evaluation
Page 9 | Confidential and Proprietary Information
Example: Extract for SMO 4
Page 10 | Confidential and Proprietary Information