International Federation of Accountants
Organizational Overview and Update
April 2002
IFAC Overview
IFAC Mission
IFAC’s mission is the worldwide
development and enhancement of the
profession with harmonized standards to
enable it to provide services of consistently
high quality in the public interest.
IFAC Overview
IFAC Today
IFAC currently has 156 member bodies in
114 countries, representing more than 2.5
million accountants.
IFAC Overview
Current Environment
The current and anticipated environment
demands that the international profession:
• Respond to globalization
• Address investor and regulator needs
• Meet expanding needs of business
• Rebuild public confidence in the
accountancy profession
IFAC Overview
Current Action Plan
Strengthening activities in five key areas:
• Standard Setting and Guidance
• Regulation of the Profession
• Development of the Profession
• Meeting Needs of Accountants
• Communications
Standard Setting and Guidance
New International Auditing and Assurance
Standards Board (IAASB)
• Comprised of 10 member body representatives, 5
from FoF and 3 public members
• Strengthen internal technical resources
• Develop high-quality auditing standards
• Increase transparency in auditing-standard setting
process
• Obtain endorsement of ISAs from IOSCO
Standard Setting and Guidance
Code of Ethics for Professional Accountants
• Serves as a benchmark for codes of conduct of
accountants worldwide
• Approved stronger independence rules last November
- Conceptual framework approach (not prescriptive)
- Highlight factors that pose threat to independence
- Focus on safeguards to minimize threat
Standard Setting and Guidance
Public Sector Accounting Standards (IPSAC)
• First authoritative international financial
reporting standards for public sector
(OECD, World Bank, etc.)
• Designed to strengthen financial reporting
and accountability of public sector
• 17 standards issued to date
Standard Setting and Guidance
Education Standards
• Action initiated to elevate education “guidelines”
to “standards”
• “Standards” designed to promote compliance (not
only consideration)
• Address pre- and post-qualification education
requirements and emerging topics such as IT
• New standards to be exposed for comment in June;
Final issuance December 2002
IFAC Overview
Current Action Plan
Strengthening activities in five key areas:
• Standard Setting and Guidance
• Regulation of the Profession
• Development of the Profession
• Meeting Needs of Accountants
• Communications
Regulation of the Profession
Regulatory Initiatives
Regulatory regime comprised of 4 primary
bodies
• Forum of Firms (FoF)
• Transnational Auditors Committee (TAC)
• Compliance Committee
• Independent Oversight Board
Regulation of the Profession
Forum of Firms
Objective
• To promote consistently high standards of
financial reporting and auditing worldwide
in the interest of the users
Regulation of the Profession
Forum of Firms
FoF members will work to achieve this objective by:
• Comply with FoF Quality Standard
• Subject policies, methodologies, and work to
periodic external quality assurance review
• Promote use of international auditing and
assurance standards
• Involve in IFAC activities
Regulation of the Profession
Transnational Auditors Committee (TAC)
• IFAC Committee and executive arm of FOF
• Responsibilities include:
- Connect FoF and IFAC Board
- Develop, maintain and administer the
Quality Assurance Review program
- Develop guidance regarding transnational audits
Regulation of the Profession
Compliance Committee
Objective
Encourage improvement and enhancement
of standards within IFAC member bodies
through greater compliance with standards,
rules and guidelines issued by IFAC
Regulation of the Profession
Compliance Committee
Responsibilities include:
• Evaluate potential member applications for Board
consideration
• Review member bodies’ harmonization of IFAC
pronouncements with local rules
• Help member bodies comply with IFAC
requirements
• Work closely with TAC to monitor FoF member
Regulation of the Profession
Independent Oversight Board
• Preserve and strengthen public confidence
in financial reporting and the integrity of the
audit process
• Review FoF quality control process and
IFAC activities
• Draft charter was exposed for comment
• Revisit framework in light of recent
environmental changes.
IFAC Overview
Current Action Plan
Strengthening activities in five key areas:
• Standard Setting and Guidance
• Regulation of the Profession
• Development of the Profession
• Meeting Needs of Accountants
• Communications
Development of the Profession
International Forum on Accountancy
Development (IFAD)
• IFAD was created in 1999 to improve financial
reporting, auditing practice and corporate
governance
• Currently comprised of over 30 public and private
institutions
• Developing and implementing country action plans
Support for Accountants
Meeting the Needs of a Diverse
Profession
• SMP Task Force established to address needs of
Small and Medium-Sized Practices
• Working group established to focus on meeting the
needs of accountants in business, industry and
commerce
• IFAC’s web site provides a wide range of mostly
free guidance for the world’s accountants
Communications
Responding to Public Concern
Establishing international task force to study
and recommend principles of best practice in
the areas of ……
•
•
•
•
Financial and business reporting
Corporate governance
Auditor performance
Interim report expected in November 2002
Final report to be issued in March 2003
Communications
Increased Spokesmanship
• Represent the profession to international
bodies
• Express profession’s view to IOSCO and
other international institutions
• Explain the profession’s role with respect to
public interest and other responsibilities
IFAC Summary
Current Action Plan
Strengthening
• Standard Setting and Guidance
• Regulation of the Profession
• Development of the Profession
• Meeting Needs of Accountants
• Communications
International Federation of Accountants