International Federation of Accountants IFAC’s Role in Supporting SMPs Robert Bunting, IFAC President SMP Forum Beijing, China October 28, 2009

The Credit Crisis

IFAC SMP Forum Raising the profile of SMPs and SMEs Collaboration with others IFAC’s global voice Agenda

IFAC SMP Forum 42 million in China – 99.9% 68% of exports 75% of new jobs created More than 65% of China’s patents However – 67,000 ceased operations in first half of 2008 (source: NDRC) Importance of SMEs

IFAC SMP Forum Financial, tax, accounting and assurance services Regulatory compliance Strategic and business sounding board/advisor IT and financial reporting systems support Risk management, fraud prevention, HR and more Credibility and communications with banks and outside stakeholders (FT Banker Survey) SMPs - Helping SMEs Survive and Thrive

IFAC SMP Forum Guide to use of ISAs on SME audits Guide to Quality Control for SMPs Practice Management for SMPs Advocacy of IFRS for SMEs Promotion of “Train the Trainer” for IFRS for SMEs IFAC Support for SMPs

IFAC SMP Forum IAASB alternative assurance project Participation in IFAC Boards and Committees SMP Review initiative Primary placement in the IFAC “global voice” initiative IFAC Support for SMPs

IFAC SMP Forum Conducted by FT Banker magazine Focused on SME lending and SMP services Represents marketplace validation for –Impact of credit crisis on SMEs –Critical role of professional accountant in accessing credit Other opportunities for SMPs –Assisting with private capital raising –Support for public listing The Banker Survey is available at this conference IFAC Support for SMPs – FT Banker Survey

IFAC SMP Forum World Bank initiative announced in July 2009 Objective is “coordinated and sustained capacity building for the profession” Working together: –IFAC –World Bank, Regional Development Banks, Bilateral Agencies –Member Bodies –Regional Organizations Long-term work in progress Collaboration with Others

IFAC SMP Forum Threats –Credit availability –Shrinking SME population –Loss of innovation and source of growth –Re-regulation of the financial markets The Global Voice and SMPs

IFAC SMP Forum Opportunities –Accounting and auditing are important issues –SMEs are recognized as necessary to growth and innovation –The accounting and auditing profession has received less criticism than in the past –We can help shape the future – using our “Global Voice” The Global Voice and SMPs

IFAC SMP Forum How? –G-20 Forum (and others) –Common voice – nationally and globally –Featuring the importance of helping the SME (SMP) sector – “Think small first” The Global Voice and SMPs

International Federation of Accountants