Transcript INTERNATIONAL FEDERATION OF ACCOUNTANTS

NASBA
Role of State Regulators in Global
Standards Setting
Bob Bunting, Deputy President
October 29, 2008
Obstacles to Common Standards and Uniform
Quality
Obstacles
Competition
Sovereignty and national pride
Champion industries
Politics
Cost and inconvenience
Representation
Implementation
Leading to a lack of Collaboration
……..And, yet…….
IFRS & ISAs
Over 110 countries require or permit the
use of IFRS
Over 110 countries require or permit the
use of IFRS
Benefits of a United Global Approach
Enhanced levels
of production of
goods and
services
Promotion of
growth and
efficiency in
capital and
labor
markets
Improved
economic
decision-making in
the private and
public sectors
Reduction of
poverty
Suppressing
corruption
Improved
Corporate
Social
Responsibility
reporting
Provision of
high quality
performance Confidence in
information
international
standards
High quality
financial
management and
reporting practices
by organizations
Improved
legislation and
regulation of
professional
liability
High quality
audit
practices by
firms
Enhanced
governmental
accountability
Enhanced
Corporate
Social
Responsibility
Enhanced
level of
competence
within the
accountancy
profession
Strong
Standards &
professional
guidance
accountancy
Promoting quality
firms
Support for Adoption
Support
for
Stable and
Strong ethical
Implementation
robust
Adoption of
behaviors
Representation
regulation that
Strong
high quality
demonstrated
Communications
Lower
promotes
professional
international
by professional
transaction
growth and
accountancy
standards
accountants
costs for
efficiency
institutes
Effective
cross-border
implementation
High public
capital flows
Strong
and enforcement
confidence in
organizational
of international
the accountancy
governance
standards
profession and
and
its services
management
Enhanced
Consumer
structures
Enhanced
credibility
of and
confidence in
attractiveness
of
accessibility to
the integrity
the accountancy
financial and
Strong legal
and efficiency
profession
non-financial
frameworks
of the markets
information
Lower
cost of
capital
Assisting
fair trade
Achieving
social
equity
Enhanced
transparency
Enhanced
corporate
behavior
IFAC’s Role in Moving the Profession to
the Next Level
Mission
To serve the public interest, IFAC will continue to
strengthen the worldwide accountancy profession and
contribute to the development of strong international
economies by establishing and promoting adherence to highquality professional standards, furthering the international
convergence of such standards, and speaking out on public
interest issues where the profession’s expertise is most
relevant
Values:
Integrity
Expertise
Transparency
IFAC Strategic Themes
1. Be recognized as the international standards setter in
the areas of auditing and assurance, education, ethics
and governmental financial reporting
2. Actively support the adoption of, and assist in, the
implementation of international standards
3. Continually enhance the relevance of the profession
4. Be the international voice of the accountancy
profession
IFAC Organization
KEY
ACCOUNTABILITY
OVERSIGHT
CONSULTATION/ADVICE
Structure of the IAASB
PUBLIC INTEREST OVERSIGHT BOARD
MONITORING
GROUP
Consults/
Advises
Liaison/
Consultation
IFAC
REGULATORY
LIAISON
GROUP
Oversees Due Process/
Approves Appointments and ToR
INTERNATIONAL
AUDITING
AND
ASSURANCE STANDARDS
BOARD
Provides Input
ED RESPONDENTS
AND OTHER
STAKEHOLDERS
INTERNATIONAL
ORGANIZATION
OF SUPREME
AUDIT
INSTITUTIONS
CONSULTATIVE
ADVISORY
GROUP
Consults/
Advises
IFAC BOARD
Appoints
Members/
Establishes
ToR
NATIONAL
STANDARD
SETTERS &
REGULATORS
SMALL AND
MEDIUM
PRACTICES
COMMITTEE
Checks and Balances
•
•
•
•
•
•
Monitoring Group (Regulators)
Public Interest Oversight Board (Appointed by MG)
Independent Chair
Public Members
CAG members (Regulators, Users)
Transparent Process
– Minutes
– Exposure drafts
– Other observers
Shared Regulation
Regulation and the Public Interest
• Professional accountancy bodies and
governments share common objective:
ensuring accountants serve the public
interest and meet high standards
• And common goal:
regulation with benefits that exceed costs
Shared Regulation
Shared Regulatory System
Self regulation and external regulation
reinforce each other; combine to form a
regulatory mix that is effective and efficient.
Shared Regulation
Goals of Shared Regulation in IAASB
Standard Setting
• Protect and respond to the public interest
• Maintain and strengthen legitimacy through:
– Independence
– Performance
• Responsiveness
• Efficiency
– Accountability
Shared Regulation
Standard Setting That Protects the
Public Interest
Legitimacy
Independence
Accountability
Performance
Shared Regulation
A Balanced System of Standard Setting
• Appropriately balances functions between
public and private sectors
• Balance between technical and nontechnical
roles
• Balance between formal and informal
consultation and communication
• Aim is overall system performance
NASBA / State Board Roles
Structure of the IAASB
PUBLIC INTEREST OVERSIGHT BOARD
MONITORING
GROUP
Consults/
Advises
Liaison/
Consultation
IFAC
REGULATORY
LIAISON
GROUP
Oversees Due Process/
Approves Appointments and ToR
INTERNATIONAL
AUDITING
AND
ASSURANCE STANDARDS
BOARD
Provides Input
ED RESPONDENTS
AND OTHER
STAKEHOLDERS
INTERNATIONAL
ORGANIZATION
OF SUPREME
AUDIT
INSTITUTIONS
CONSULTATIVE
ADVISORY
GROUP
Consults/
Advises
IFAC BOARD
Appoints
Members/
Establishes
ToR
NATIONAL
STANDARD
SETTERS &
REGULATORS
SMALL AND
MEDIUM
PRACTICES
COMMITTEE
NASBA
Role of State Regulators in Global
Standards Setting
Bob Bunting, Deputy President
October 29, 2008