Developing the Profession – IFAC 1 Developing a Nascent Audit Profession World Bank Advanced Program in Accounting and Auditing Regulation June 28, 2005

Developing the Profession – IFAC 2 Overview About IFACAbout IFAC IFAC Membership and ComplianceIFAC Membership and Compliance –Member Body Obligations –Compliance Program IFAC Developing Nations Permanent Task ForceIFAC Developing Nations Permanent Task Force –Role, Objectives and Priorities Establishment and Development of the ProfessionEstablishment and Development of the Profession –Challenges –Opportunities for Co-operation and Collaboration

Developing the Profession – IFAC 3 Global organization for accountancy professionGlobal organization for accountancy profession Expanding network of 163 member bodies in 119 countries, representing 2.5 million accountantsExpanding network of 163 member bodies in 119 countries, representing 2.5 million accountants Supported by regional accounting networksSupported by regional accounting networks IFAC Today

Developing the Profession – IFAC 4 IFAC’s Mission To serve the public interest, strengthen the worldwide accountancy profession and contribute to the development of strong international economies

Developing the Profession – IFAC 5 Membership and Compliance Statements of Membership ObligationsStatements of Membership Obligations –Approved by IFAC Board March 2004 –Basis for evaluating status of members in good standing –Basis for evaluating new applicants Incorporate International StandardsIncorporate International Standards Assist in implementing the International StandardsAssist in implementing the International Standards

Developing the Profession – IFAC 6 Seven SMOs Quality assurance Investigation and discipline International Education Standards Pronouncements and papers issued by the IAASB IFAC Code of Ethics IPSASs and other PSC guidance International Financial Reporting Standards

Developing the Profession – IFAC 7 Statements of Membership Obligations Obligations whether the SMO function is the responsibility of:Obligations whether the SMO function is the responsibility of: –The member body; or –Another body (government, regulators, other professional organization etc)

Developing the Profession – IFAC 8 Compliance with SMOs A member has used best endeavors ifA member has used best endeavors if –It could not reasonably do more than it has done and is doing to meet the particular obligation

Developing the Profession – IFAC 9 Member Body Compliance Program Three key aspectsThree key aspects –Regulatory and standard-setting framework fact-gathering –Convergence activities and gap analysis –Action plans and development

Developing the Profession – IFAC 10 Compliance Activities Part 2 SMO Self-AssessmentPart 2 SMO Self-Assessment –Convergence approach –Standards incorporated –Monitoring and quality assurance programs –Implementation activities Part 2 Basis for gap analysisPart 2 Basis for gap analysis –Reasons for not incorporating standards –Regulatory and resource challenges

Developing the Profession – IFAC 11 Compliance Activities Part 3 Action plansPart 3 Action plans Identify solutionsIdentify solutions Member body responsibilitiesMember body responsibilities Program enforcement actionProgram enforcement action –Failure to demonstrate evidence of best endeavors –Lack of participation

Developing the Profession – IFAC 12 Communicating Results Share and exchange informationShare and exchange information –World Bank, development banks, donors Results to be posted on IFAC websiteResults to be posted on IFAC website Demonstrate members’ progressDemonstrate members’ progress –Activities to improve audit quality –Basis for facilitating discussions with regulators and governments –Dialogue with other national bodies

Developing the Profession – IFAC 13 VisionVision –Every country to have a recognised member body of IFAC. MissionMission –To support the development of the worldwide accountancy profession working in partnership with the global profession and other relevant organisations Developing Nations Task Force

Developing the Profession – IFAC 14 Priorities Tools to assist professional bodiesTools to assist professional bodies Share and transfer informationShare and transfer information –Access to resources –Ways to address challenges to implementation of standards –Experience in facilitating regulatory reform Input to standard-setting processInput to standard-setting process Grow IFAC membershipGrow IFAC membership

Developing the Profession – IFAC 15 Role of Accountancy Bodies Sustainable development of profession requires a professional bodySustainable development of profession requires a professional body Objective must be to develop and enhance the professionObjective must be to develop and enhance the profession PartnershipPartnership –Government –Accountants and Auditors –Public

Developing the Profession – IFAC 16 Development Challenges CapacityCapacity EnvironmentEnvironment ResourcesResources

Developing the Profession – IFAC 17 Opportunities for Co-operation and Collaboration IFAC membershipIFAC membership Regional co-operationRegional co-operation Collaboration between the international profession, development partners, and governmentsCollaboration between the international profession, development partners, and governments

Developing the Profession – IFAC 18 Conclusion High quality standards and practicesHigh quality standards and practices Issues and challenges in developing and transition economiesIssues and challenges in developing and transition economies IFAC activities as a platform for change and communicationIFAC activities as a platform for change and communication

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