• Register
Return to: Home > News > Professional Bodies > Analysis: IFAC’s role in international audit standards setting could be scrapped

Analysis: IFAC’s role in international audit standards setting could be scrapped

The Monitoring Group, which oversees the International Federation of Accountants (IFAC), will release a public consultation laying out several options of reform including an option to transfer the audit standard setting component of IFAC to an independent organisation, The Accountant has learnt.

The Accountant understands that the Monitoring Group, a group of international financial institutions and regulatory bodies committed to advancing the public interest in areas related to international audit standard setting and audit quality, has received feedback from several stakeholders  – including audit firms – that audit quality could be enhanced through a standard setting process independent from the profession, in other words outside of IFAC's remit.

The public consultation will be released next week (week starting 6 November) and will explore the possible reforms. The Accountant understands that although the Monitoring Group is looking at a standards setting process independent from the profession, the oversight body firmly believes that IFAC would retain some role to give technical input in the process.

Based on private conversations with a variety of stakeholders, The Accountant understands that IFAC is satisfied with the current model although open and welcoming of a review to find ways to improve. However this magazine understands that IFAC is weary that the consultation might be influenced by pre-established idea that reforms does need to happen and would be a mean to an end.

Rather IFAC would wish to see a review process that is objective based on robust analysis, and clearly identifies costs, benefits and risks. If reform does happen, IFAC would favour a model whereby all accounting stakeholders retain an input in the standards setting process.

The main challenge for such reform will be the funding, as it is unclear who would fund an independent audit standards setter. The Accountant understands that the Monitoring Group is still uncertain on this particular point and hopes to find answers in the consultation.

The consultation will last for three months and while in public both the Monitoring Group and IFAC will state the importance of collaboration, The Accountant understands from private conversations with stakeholders which have accompanied conversations in recent months between the two organisations, that such conversations have been heated and consensus will be hard to find.

Top Content

    ARGA team, assemble!

    The new top team has been named that will see in root-and-branch reform at the Financial Reporting Council (FRC) as it transforms into the Audit, Reporting and Governance Authority (ARGA). Will the new duo be as dynamic as some are hoping? Robin Amlôt reports.

    read more

    FASB: a quest for simpler standards

    FASB chair Russell Golden addressed the IMA 2019 Annual Conference and Expo at the Sheraton San Diego Hotel and Marina, California, on 18 June. IMA immediate former chair-emeritus Alex Eng acted as moderator. Joe Pickard reports.

    read more

    The future of audit, and how to get there

    Two recent reports peer into the future of the audit profession. One analyses what an audit should offer, while the other looks at how the audit process will be carried out. Robin Amlôt takes a closer look at both.

    read more

    EFAA elects new president, focuses on digital future

    EFAA’s new president, Salvador Marin, outlined his key priorities for the next two years at the organisation’s 2019 annual general meeting, while outgoing president Bodo Richardt offered advice. Robin Amlôt reports.

    read more

    CORONAVIRUS TIMELINE: REACTIONS FROM THE ACCOUNTANCY PROFESSION

    As the Coronavirus (COVID-19) continues to spread across the world, the International Accounting Bulletin and The Accountant will be collating all the latest news and updates from the profession on the pandemic’s impact.

    read more
Privacy Policy

We have updated our privacy policy. In the latest update it explains what cookies are and how we use them on our site. To learn more about cookies and their benefits, please view our privacy policy. Please be aware that parts of this site will not function correctly if you disable cookies. By continuing to use this site, you consent to our use of cookies in accordance with our privacy policy unless you have disabled them.