Issue 3/2009
Compiled by the International Affairs and
Special Projects Department
12 – 16 January 2009
In This Issue
•
Satyam to Appoint New Auditor
•
CIMA Forms Alliances with Australia & Canada
•
WTO Launches
Agreements
•
Auditors Struggling to Keep Up with Asian Business Boom
•
ICAEW Gets Tough on Training
•
India, Asean to Discuss Services & Investment
New
Database
on
Regional
Trade
Satyam to Appoint New Auditor
Satyam, the troubled Indian outsourcing business, has said it will name a new auditor
within the next two days, according to reports.
The Wall Street Journal reports that the Satyam board has said it is looking for an
alternative auditor to the incumbents PwC.
The change comes after the company’s chairman, B. Ramalinga Raju, last week
resigned and admitted a massive accounting fraud thought to be worth more than $1bn
had taken place at the business.
The affair has been described as India’s own Enron.
The WSJ this morning quotes company director Deepak Parekh saying that new
accountants are expected to restate the accounts and confirm their ‘veracity’.
PwC has defended its audit of Satyam saying it was conducted according to ‘applicable
auditing standards’ supported by ‘appropriate audit evidence’.
http://www.accountancyage.com/accountancyage/news/2233825/satyam-appoint-auditor
CIMA Forms Alliances with Australia & Canada
The Chartered Institute of Management Accountants (CIMA) has announced a global
agreement with CMA Canada and CPA Australia.
The CPA Australia alliance is based on an initial four-year term, and the CMA Canada
agreement is a renewal for an additional five years of the original agreement.
The new agreements will be accessible to more than 190,000 finance professionals.
Glynn Lowth, president of CIMA, said the agreements will serve to bolster its position
through increased knowledge-sharing and collaboration.
'The nature of the international economy dictates that management accountants must be
globally-minded, he said.
Alex Malley, president of CPA Australia, said the CIMA Professional Qualification is
recognised by the global business community and the agreement will allow members
access to international job markets.
http://www.accountancyage.com/accountancyage/news/2233836/cima-signs-alliance-ozcanada
WTO Launches New Database on Regional Trade Agreements
The WTO has launched a new database on regional trade agreements (RTAs). This
contains all the relevant documentation received by the WTO following notification by a
WTO member that an RTA has been established.
The database, which is one of the requirements of the General Council’s Transparency
Decision on RTAs, contains all the notifications, links to the content of the relevant
RTAs, legal provisions and information on the WTO’s assessments of the RTAs.
The database also contains more detailed information about the RTAs for which the
WTO has prepared a “Factual Presentation” or a “factual abstract”. In these cases the
following information is provided:
the timetable agreed in the RTA for the reduction of tariffs as well as data on trade in
goods and services for the relevant countries at the time that the RTA enters into force
(this only applies to RTAs where the WTO has prepared a Factual Presentation)
a list of key provisions contained in the RTAs as well as links to brief descriptions of
these provisions in the Factual Presentation or factual abstract prepared by the WTO.
The database can be searched by country, region, legal provision, date of notification or
entry into force of the RTA. Summary tables of all RTAs currently in force, containing
various types of information, can be easily exported by users of the database.
The database is accessible on the WTO website http://rtais.wto.org
http://www.bilaterals.org/article.php3?id_article=14202
Auditors Struggling to Keep Up with Asian Business Boom
Investors are concerned about the ability of the Asian audit market to keep apace with
the rapid growth of businesses, says Asian Corporate Governance secretary general
Jamie Allen.
'The accounting firms are running fast to try and keep up but even they admit that there
is a limit to the depth of their expertise,' said Allen in an FT feature.
Unless companies improve their governance they will be shunned by moderate
investors. 'These companies will have to accept lower share prices because of the
corporate governance discount,' said Hong Kong-based investor activist David Webb.
Asian corporate governance has come under the spotlight again after its chairman
admitted to a $1bn accounting fraud at Satyam. Investors have asked why auditors
PricewaterhouseCoopers did not spot the fraud.
http://www.accountancyage.com/accountancyage/news/2233922/auditors-strugglingasian
US- Malaysia FTA Talks Postponed On US Request
The negotiations between Malaysia and the United States on a Free Trade Agreement
(FTA) have been postponed on request from Washington, Minister of International Trade
and Industry, Tan Sri Muhyiddin Yassin said.
"This is not the ministry’s decision. Fact is the talks have been temporarily stopped on
the request made by the US. We should have had a meeting before the end of 2008, but
they had requested for the postponement," he said.
This is probably due to the transition in power and administration in the United States
from George W. Bush to Barack Obama, he said when asked on the status of the FTA.
Apart from that, the ministry is also studying closely the matter and Malaysia is not
rushing into it as there are many issues to be looked into, he said.
"We have to study all the issues that have been listed under the various sectors under
the negotiations," he said.
On the boycott of US products in Malaysia, Muhyiddin said: "If there are Malaysians who
want to take such an action, it is their right. As for the government, we have not taken
any decision on the matter."
http://www.bilaterals.org/article.php3?id_article=14201
ICAEW Gets Tough on Training
The ICAEW has fined members for the first time for failing to meet the requirements for
continuing professional development.
Under CPD rules, made compulsory by the institute in 2004, members have to provide
evidence that their accounting skills have kept pace with their clients’ needs.
Rajbir Singh Sohal of Coventry and Martin Lewis Dawe of Isleworth were reprimanded
and fined for not meeting CPD requirements between 2005 and 2006. Sohal was fined
£1,000 and paid costs of £1,348. Dawe was fined £1,500 and ordered to pay costs of
£1,198. Dawe was also stripped of membership after failing to pay.
The ICAEW said Singh had failed to submit a form summarising what CPD he had
undertaken, while Dawe failed to complete a certificate of compliance with CPD
requirements and failed to respond to its enquiries on the matter.
http://www.accountancyage.com/accountancyage/news/2234027/icaew-gets-toughtraining-4430664
India, Asean to Discuss Services & Investment
Senior government officials from 10 south-east Asian countries are meeting their Indian
counterparts in New Delhi to finalise the contents of a free-trade agreement (FTA) on
services and investment between India and the Association of South-East Asian Nations
(Asean).
The meeting will give a final shape to the agreement that will be implemented by the
year-end. The two sides have already concluded an FTA on goods, which is likely to be
implemented soon.
India’s trade with the Asean, its fourth-largest trading partner after the EU, US and
China, has been growing at a compounded annual growth rate of 27%. Bilateral trade
stood at $38.37 billion in 2007-08 and is projected to reach $48 billion in 2008-09.
The agreement on services will allow Indian service providers to access the Asean
markets and set up operations there. The investment agreement is expected to work
both ways in terms of attracting FDI from Asean members, especially Singapore and
Malaysia, and providing opportunity to Indian companies in sectors like pharmaceuticals,
coal mining and automobiles to invest in Asean region.
“The talks on investment and services are in the initial stages. The picture will be clear
after a couple of more meetings,” a government official said.
When India and Asean kicked off negotiations on the bilateral FTA in 2002, they were
supposed to finalise a comprehensive agreement that covers goods, services and
investment. However, the regional grouping prevailed on
When the two sides finally concluded the goods agreement in August last year after
years of negotiations, they decided to start talks on services and investment and
conclude them by 2009-end.
The framework agreement of the India-Asean comprehensive economic partnership
agreement lays down that commitments in services should go beyond what the countries
agree to on the multilateral platform of the World Trade Organization. Apart from
securing easier visa norms for its service providers, India is keen on working out mutual
recognition agreements with the Asean to enable Indian professionals like doctors and
chartered accountants to work in Asean on the basis of qualifications earned in India.
In the area of investments, both sides have talked about strengthening cooperation in
investment, facilitating investment, improving transparency of rules and regulations and
providing for the protection of investments. This will help Indian banks and insurers to
set up business in Asean. India to conclude talks on goods first and then move on to
services and investment.
http://economictimes.indiatimes.com/Economy/India_ASEAN_to_discuss_investments/a
rticleshow/3980445.cms
DISCLAIMER: All compiled news items are correct at the time of release. This document
is for information only. The Institute does not take any responsibility arising from the use
of information contained in this document.