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December 14, 2007

Region round-up

Region round-up


Asia Pacific• Australia’s National Institute of Accountants has signed an agreement with China’s major employer organisation, which has more than 430,000 members, to jointly deliver accountancy education programmes in China beginning in 2008. The China Enterprise Confederation – China Enterprise Directors Association’s members are mainly enterprises, companies and entrepreneurs. 

 New Zealand Institute of Chartered Accountants has become a platinum corporate sponsor of Enterprise New Zealand Trust. The trust was established more than 25 years ago with a vision to transform New Zealand’s future economic prosperity through improved entrepreneurship and financial education in schools.

• Confidence levels in the new audit standards impacting positively on audit quality have fallen in the past year, according to a survey from CPA Australia. In May 2006 the Australian Auditing and Assurance Standards Board issued 35 new legally enforceable auditing standards, which apply to all audits conducted under the nation’s Corporations Act. Prior to their application, CPA Australia surveyed about 80 finance, accounting and business professionals and found nearly 80 percent believed audit quality would be improved. Almost 60 percent thought the new standards would help to improve public confidence in financial reports. However, the Confidence in Corporate Reporting 2007 survey revealed that only 53 percent of auditors believe the new standards had improved audit quality.

• The Auditing and Assurance Standards Board in Australia has announced the release of an exposure draft of a new assurance standard for compliance engagements. The proposed standard, ASAE 3100 Compliance Engagements, will assist with the audit or review of an entity’s compliance with requirements under criteria.

• The Accounting Standards Board of Japan (ASBJ) has released its project plan for achieving convergence of accounting standards. The plan was approved by the ASBJ board earlier this month. It is based on the Tokyo agreement with the International Accounting Standards Board.

• The China Accounting Standards Committee, the Accounting Standards Board of Japan and the Korea Accounting Standards Board have held their annual standard setters meeting to discuss updates on recent developments in their national accounting standards and on their policy and efforts towards global convergence of accounting standards. The three standard setters agreed they should continue the regular meetings and pursue more productivity.

• The Association of International Accountants intends to sign a recognition agreement with the Hong Kong Institute of Certified Public Accountants.

• Australia’s National Institute of Accountants has re-elected Greg Dennis as president for another term. Other important appointments for include deputy president Christine Leetham, vice-president Kevin Dawes and treasurer David Hickman.

Africa, Middle East, South Asia

Africa, Middle East, South East Asia• The Accounting and Auditing Organisation for Islamic Financial Institutions (AAOIFI) is introducing a programme to certify whether financial contracts between Islamic financial institutions and their clients comply with AAOIFI standards – particularly Sharia standards. The objectives of the programme are to increase awareness of AAOIFI standards, to promote compliance to AAOIFI standards and to introduce harmonisation of Islamic finance practices. The certification will assist Islamic financial institutions in marketing Sharia-compliant products to their customers and will also provide independent endorsement of the institutions’ Sharia compliance.

• The accountancy profession’s broad-based Black Economic Empowerment (BEE) charter has been signed in Johannesburg, South Africa. The charter, which has taken four years to develop, aims to alleviate the skills shortage in the South African accountancy profession. Since 1976, only 912 black Africans have qualified to become CAs in South Africa. Ignatius Sehoole, chairman of the profession’s BEE negotiation charter forum and also the executive president of the South African Institute of Chartered Accountants, said: “To create an environment in which economic growth may continue while facilitating effective transformation, the skills profile of our population must move towards reflecting the country’s demographics while still meeting growth needs and maintaining standards.”

Ernst & Young (E&Y) has opened its first office in Libya. The new Tripoli office will provide a foundation for the global network to establish a foothold in the recently opened and rapidly expanding Libyan economy. The Libyan practice is part of E&Y’s Middle East regional practice, which is grouped in the Northern European, Middle East, Indian and African area of the firm. It is staffed by 25 local and expatriate professionals with significant country and industry expertise. E&Y said it aimed to double its Libyan work force by the end of 2008 and will actively recruit and train local talent as part of a nationalisation initiative.

• The South African Institute of Chartered Accountants (SAICA) has appointed a new project director for tax. Muneer Hassan, a tax and auditing specialist, will advise SAICA members on tax issues that affect accountancy. Before joining SAICA, Hassan was the audit manager and tax technical advisor at the South African Revenue Services (SARS). Hassan said he hoped to cement SAICA’s relationship with SARS and assess how SAICA can influence certain aspects of South African tax laws to ensure that they are on par with international standards.

Institute of Chartered Accountants of Pakistan past president and council member Syed Mohammad Shabbar Zaidi has been elected as president of the South Asian Federation of Accountants (SAFA) for 2008. He will take over at the helm from Indrajith Fernando. Zaidi was elected this month at the third SAFA board meeting in Mumbai, India. Muhammad Asif Iqbal, director of professional standards compliance and evaluation at the institute, has also been nominated as executive secretary of the regional accountancy body.

Europe Europe• The Committee of European Securities Regulators (CESR) has published extracts from its database of enforcement decisions taken by EU national enforcers participating in European Enforcers Co-ordination Sessions. CESR said the publication of extracts and reasoning behind these decisions will contribute to a consistent application of IFRS in the EU. CESR said it will continue publishing extracts from the database on a regular basis.

• The Institute of Chartered Accountants in England and Wales has launched a new financial reporting faculty. The faculty is a response to fundamental changes in the financial reporting environment and the increasing complexity of relevant laws and standards. Deloitte UK partner Andy Simmonds will chair the faculty’s operational board.

PKF UK has promoted Jason Homewood to assurance and advisory partner in the firm’s London office. Homewood specialises in assisting companies in making the transition to IFRS, as well as advising both clients and staff on the interpretation of IFRS. His other main area of expertise is mining and resources, in which he has a significant number of clients.

• The UK Auditing Practices Board (APB) has issued two consultation papers on auditing standards relevant to group audits. The first is a proposed addition to International Standard on Auditing (UK and Ireland) 600 Using the Work of Another Auditor, which reflects forthcoming legal requirements in relation to statutory audits of consolidated accounts. The second document discusses the action that the APB should take regarding the recent revision by the International Auditing and Assurance Standards Board of ISA 600.

• The Association of Chartered Certified Accountants is seeking a new chief executive after Allen Blewitt announced he will not seek to extend his fixed five-year contract, which finishes on 30 November 2008. Blewitt said he will return to Australia in order to devote time to his family and to other professional activities.

• The European Commission has called on member states to review and bring tax avoidance legislation in line with European laws. The communication appears to be a swipe at avoidance laws that restrict the flow of activity in the single market. László Kovács, European Commissioner for Taxation and Customs Union, said: “I understand that member states need to ensure that their tax bases are not unduly eroded because of abusive and overtly aggressive tax planning schemes, but we cannot tolerate disproportionate obstacles to cross-border activity within the EU.”

• Rimess, a pan-Baltic service company and a member of Praxity and Mazars, is to merge with two Lithuanian firms. Rimess entered the Lithuania marketplace in 2006. Now the partners of Rimess, Renovacija and Audito Reziume have announced their intention to merge. The combined operation will have offices in Vilnius and Kaunas with four audit partners and 35 staff.

North America, Latin America Americas• The US Financial Accounting Standards Board (FASB) has launched a series of periodic webcasts. The first, entitled ‘Towards a Global Reporting System: Where Are We and Where Are We Going’, is scheduled for 8 January 2008, and will feature a panel of experts discussing international convergence of accounting standards. The panel will cover topics that include steps necessary to ensure a successful transition to IFRS, how this transition will provide better information to investors and progress made by the FASB and the International Accounting Standards Board on global accounting standards.

• A KPMG Canada survey has found that private businesses in Canada would like a simplified accounting model reflective of their financial reporting needs. The survey found the private sector believes that there is an overload of accounting standards.

• Nick Le Pan has been appointed chairman of the Canadian Public Accountability Board (CPAB) for a three-year term beginning in April 2008. Le Pan replaces Gordon Thiessen, who will retire from the board after serving as chairman since 2002. David Wilson, chairman of the Ontario Securities Commission and chair of the council of governors of the CPAB, said Le Pan was the council’s unanimous choice.

• The US Public Company Accounting Oversight Board has published a staff audit practice alert on the audit of fair value measurements in financial statements. The alert, which is entitled ‘Matters Related to Auditing Fair Value Measurements of Financial Instruments and the Use of Specialists’, provides auditors with additional information related to auditing fair value measurements and disclosures.

• Deloitte US has been censured by the US Public Company Accounting Oversight Board (PCAOB) and agreed to pay a $1 million fine for violations of the board’s interim auditing standards. The PCAOB held disciplinary proceedings against Deloitte and a former Deloitte audit partner, James Fazio, in connection with the firm’s 2003 audit for Ligand Pharmaceuticals.

• The Canadian Institute of Chartered Accountants (CICA) has released its 2007 Uniform Evaluation Honour Roll. The list consists of 52 candidates who achieved the highest grade in examinations that Canadians must pass to join the CA profession. In addition, CICA has announced that chief executive Kevin Dancey will be the vice chair on the government advisory panel on Canada’s system of international taxation.

• A Deloitte Canada survey has found Canadian tax laws may be affecting inflows of venture capital. Almost 40 percent of US respondents to the global trends in venture capital survey said Canada’s tax environment was a reason why they did not invest there.

• The Certified General Accountants Association of Canada has strengthened its ties with the Certified General Accountants Association of the Caribbean. Under the agreement, the Caribbean branch will represent members and students in the region, grant CGA designations and administer member standards and the CGA programme.


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