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November 14, 2007

News briefs

News briefs

FINANCIAL RESULTS E&Y Global revenue grows 15%

Ernst & Young (E&Y) announced its worldwide combined revenues increased to $21.1 billion for the fiscal year ending 30 June 2007. This represents a growth rate of 15 percent. Despite the growth, E&Y remains third in TA sister publication International Accounting Bulletin’s global firm rankings list, behind PricewaterhouseCoopers Global (PwC) and Deloitte Global. This year, PwC reported that gross revenues of its network of firms increased 10.5 percent to $25.2 billion over the financial year ending 31 May 2007.

PEOPLE Grant joins IAASB Jon Grant, executive director of the UK Auditing Practices Board, has been appointed to serve on the International Auditing and Assurance Standards Board (IAASB). He will sit on the board for three years starting this January. Paul Boyle, chief executive of the UK Financial Reporting Council, welcomed Grant’s appointment. “Jon Grant’s appointment to the IAASB is international recognition of his expertise and helps the UK remain influential in the development of international auditing standards,” he said.

PEOPLE Newman to take helm of BDO BDO International has revealed Jeremy Newman is to become chief executive of the global network next year. Newman has been managing partner of UK member firm BDO Stoy Hayward since 2001. His term is due to end in September 2008 and he will succeed current chief executive Frans Samyn at BDO International a month later. BDO cited his leadership on topical issues as one of the key attributes that makes him an ideal candidate to promote the network’s market position, strength and capabilities.

IFRS AICPA supports IFRS

The American Institute of Certified Public Accountants (AICPA) has recommended that the US Securities and Exchange Commission (SEC) harmonise US and international financial reporting. This would include allowing US companies to report financial results using IFRS. In a comment letter to the SEC, the AICPA said: “We believe one common accounting language would benefit investors, as well as issuers and the capital markets.” It also encouraged the SEC to gather information on the number of public companies that would choose IFRS.

REGULATION Canada issues GAAP schedule The Canadian Accounting Standards Board has published a summary of future changes to Canadian GAAP. The board has released the publication in anticipation of the changeover to IFRS, which is expected to take place on 1 January 2011. The document summarises the changes that will take place to Canadian accounting standards between now and 2011. It also shows when certain parts of IFRS will be incorporated into Canadian GAAP.

PEOPLE Pecarich receives tax award

The American Institute of Certified Public Accountants (AICPA) has awarded Pamela Pecarich the Arthur J Dixon Memorial Award, which is the highest accolade the institute gives in the area of taxation. Pecarich has devoted her career to the area of tax policy at federal and state level. She has also been a volunteer leader with the AICPA. The award was presented at the AICPA’s national conference on federal taxes in Washington.

RESEARCH More companies recognise risk A KPMG International study has suggested that risk management could become the fourth performance indicator for companies. However, only 50 percent of companies surveyed believe successful implementation of risk management is achievable within the next three years. The research shows that many companies accept risk management plays a crucial role in their performance. John Abbot, head of management assurance services at KPMG, commented: “The time has come for internal risk and control teams to make the move from simply keeping score, complying with regulations and limiting losses to actually generating value.”

REGULATION EC calls for quicker reform European Commissioner for Internal Market and Services Charlie McCreevy said progress had been made in accounting reforms throughout Europe, but has called on EU states to do more to implement the EU’s Eighth Directive. McCreevy made the comments to the congress of German public auditors in Berlin. He said: “We have come a long way in creating an appropriate framework in which accounting, auditing and company law rules can play a decisive role in shaping the future of Europe’s capital markets. Much remains to be done, especially at member state level, and this is where the focus of attention should now shift.”

STANDARDS Australia to launch clarity project The Auditing and Assurance Standards Board (AUASB) has announced that Australian Auditing Standards (ASA) will be further revised and reissued based on the new clarity format versions of the International Standards on Auditing. AUASB chair Merran Kelsall said the revised ASAs will be operative in Australia for audits of financial reports for periods beginning on or after 1 January 2010. “The AUASB will release the proposed revised Australian standards as exposure drafts during the course of 2008 and early 2009,” he said, while adding that the full schedule for the review has not yet been confirmed.

STANDARDS FASB votes against deferral The US Financial Accounting Standards Board has reaffirmed its vote against a blanket deferral of Statement 157 Fair Value Measurements. For fiscal years beginning after 15 November 2007, companies are required to implement the standard for financial assets and liabilities, as well as for any other assets and liabilities that are carried at fair value on a recurring basis in financial statements. It did, however, provide a one-year deferral for the implementation of Statement 157 for other non-financial assets and liabilities. RECRUITMENT Staffing remains a challenge Finding qualified staff is the biggest challenge facing accountancy firms in the US, according to the American Institute of Certified Public Accountants. Its 2007 Top Management of an Accounting Practice Issues survey gathered information from a range of practitioners. Staff retention is a growing concern, especially for larger practices. The survey found sole practitioners were most worried about tax complexity.   STANDARDS UK ethics review concludes The UK Auditing Practices Board (APB) has conducted a review of its ethical standards for auditors. It has carried out research, reviewed third-party research and discussed the issues with interested parties. As a result, the APB believes standards are high, proportionate and meet the needs of stakeholders. It said minor amendments will be made that relate to the implementation of the EU Statutory Audit Directive, maintaining adherence to the International Federation of Accountants code, and adding clarity and assisting the implementation of the standards.

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