Colegio de Contadores, Economistas y Administradores del Uruguay

The CCEAU has no legal authority or responsibility to establish a mandatory quality assurance (QA) review system for all audits, but it has adopted ISA 220 and ISQC 1 for application by its members through the Pronouncement No. 18 in 2010. It states it has experienced challenges in establishing a QA system due to the lack of legal authority and firms' resistance to participate in a voluntary system.

Considering this, the CCEAU has reported that it advocates with the Superintendence of Financial Services within the Central Bank of the Republic (BCU), which regulates the financial sector and conducts reviews of related-audits, to join efforts and create a national QA review system.

The CCEAU created a Quality Control Commission in 2018, responsible for issuing guidelines and regulations to implement a voluntary QA review system, providing training activities, and disseminating information on relevant standards. The CCEAU report it is coordinating its activities with the Inter-American Accounting Association to support the process.

CCEAU's plans to develop and operate a voluntary QA review system serve the public interest and are aligned with best practices. During the next submission of its Action Plan, the CCEAU is encouraged to provide an update on its progress to develop and operate a voluntary QA review system. The CCEAU should continue using its best efforts to collaborate with BCU to promote and support the establishment of a unified, mandatory QA system at the jurisdiction level that meets the revised SMO 1 requirements.

The new suite of Quality Management standards that will become effective in 2021–2022 will require significant change management for regulators and firms. The CCEAU is encouraged to prepare members and raise awareness of the BCU of the changes from quality control standards to quality management standards and update its training programming to ensure that its members are sufficiently prepared to apply the standards once they become effective.

Current Status: Consider

In Uruguay, the Ministry of Education (MoE), universities, and the Central Bank of the Republic (BCU) all have roles in implementing initial professional development requirements for professional accountants, established in Decree No. 103 of 1991. These include a university degree in accounting and registering with the MoE. Given the CCEAU's lack of authority to adopt IES requirements into the national educational programs or its membership requirements, its activities primarily include actions to promote the adoption and implementation of IES requirements to the regulators.

The CCEAU states that it collaborated with the universities to assess the current accounting curricula against the IES requirements to develop a curricula model for students in the jurisdiction. For this purpose, the CCEAU created a University Matters Committee, which has signed agreements with several national universities, including the Universidad de la República, to provide academic support to courses taught at CCEAU. Furthermore, the CCEAU reports that it has sought international organizations' assistance to promote the IES to universities, specifically around curriculum content.

The CCEAU notes it is well-aware of the need to establish continuing professional development (CPD) requirements as part of best practices for the profession. The CCEAU indicates that it offers voluntary CPD for its members, and many participate in trainings and courses to receive updated information on professional practices and standards. However, it has not been able to establish mandatory CPD obligations for its members due to the voluntary nature of its membership and the cost of such a system.

The CCEAU is encouraged to establish plans in its SMO Action Plan that explain how it intends to promote and support the adoption of the IES requirements to the regulators and government with defined timelines. Revised requirements of the IES are effective as of 2021. The CCEAU is encouraged to collaborate with other stakeholders involved in the education of professional accountants in the jurisdiction, such as universities and the Central Bank of the Republic, to develop a roadmap for bringing national educational requirements for all professional accountants in line with the revised IES requirements. A voluntary certification aligned with the IES could be one option, and CCEAU can refer to other regional examples for best practice.

The CCEAU should also promote the IES requirements to the Central Bank of the Republic, which has additional requirements for external auditors, including practical experience. The Accountancy Education E-Tool developed by IFAC may be useful to identify implementation support materials.

Current Status: Consider

In Uruguay, companies are not legally required to have audited financial statements except for listed entities, banks, and financial institutions which are regulated by the Central Bank of the Republic (BCU). The BCU adopted ISA, as translated into Spanish, through Regulation No. 2136 of 2013.

Auditing standards are not specified in the law, and although the CCEAU is not legally responsible for the adoption of auditing standards in Uruguay, it has become the de facto audit standard-setter for all other audits in the jurisdictions. In 2010, the CCEAU adopted ISA as translated into Spanish and issued by the IAASB, as a self-regulatory requirement for members; however, its resolution lacks legal backing, and ISA are mainly viewed as guidelines by practicing auditors.

The CCEAU reports that it monitors new and amended standards issued by the IAASB, has ongoing processes to disseminate information on new and modified IAASB pronouncements, and provides training activities.

The CCEAU is encouraged to develop plans to promote the need for the legally binding, mandatory application of the ISA for all audits of financial statements in Uruguay.

Current Status: Review & Improve

Auditors of entities regulated by the Central Bank of the Republic (BCU) and individuals who voluntarily join the CCEAU are subject to ethical requirements in Uruguay. The BCU has adopted the IESBA Code of Ethics as issued and translated, while the CCEAU has developed its own Code of Ethics based on the 2009 IESBA Code of Ethics.

The CCEAU indicates that it has processes to disseminate information about the Code and has also included the IESBA Code of Ethics in its training programs. In December 2020, the CCEAU established a dedicated committee to update its own Code of Ethics. No information has been provided on the timeline for adoption nor the IESBA Code of Ethics version that would be used as reference.

The CCEAU has been repeatedly encouraged to include specific actions in its SMO Action Plan about its processes, consider and incorporate amendments issued by the IESBA to its adopted Code of Ethics. Multiple new revisions have been issued since 2009, the latest being the revised and restructured 2018 International Code of Ethics for Professional Accountants (including International Independence Standards). It is essential to the public interest that professional accountants adhere to the latest ethics requirements and that CCEAU is providing training and guidance on the ethics requirements to support proper implementation and application. It seems no progress has been made in this area, and this should be a high priority for the institute.

Current Status: Consider

The CCEAU is not responsible for setting public sector accounting standards and reports that it has limited influence on the decisions concerning the adoption and implementation of public accounting standards with the Court of Accounts (TCR)—the governmental organization responsible for adopting the standards. The TCR adopted IPSAS, as translated into Spanish and issued by the IPSASB.

To raise awareness about the benefits of IPSAS, the CCEAU notes that it has organized a committee to maintain a relationship with the relevant regulators. In 2020, CCEAU held a conference on IPSAS matters. To support the implementation of the standards, the CCEAU reports it has provided training to the TCR and other governmental agencies, in addition to continuing professional development courses.

Additionally, the CCEAU indicates that it has established dissemination mechanisms to distribute information regarding IPSAS amongst its members and public sector institutions and is considering further opportunities to assist in implementing IPSAS.

CCAEU has demonstrated that, within the scope of its authority, it is committed to meet the SMO 5 obligations and has established ongoing processes to maintain compliance.

Current Status: Sustain

Auditors of entities regulated by the Central Bank of the Republic (BCU) and individuals who voluntarily join the CCEAU are subject to investigative and disciplinary (I&D) systems. The BCU has adopted procedures for auditors registered in its registry; however, the extent to which the system established by the BCU aligns with the requirements of SMO 6 is unclear.

The CCEAU has established an Ethics Commission responsible for operationalizing the I&D system for its members. The Commission receives complaints about malpractices and misconduct, which is defined as criminal activity, breaches of professional standards, and breaches of ethical requirements. Between 2017–2020, the Commission processed ten cases. The CCEAU assessed its I&D policies against the requirements of SMO 6 and has identified the main gaps, such as members of the I&D committee do not include non-accountants and limited ability to impose sanctions, among others.

In addition, CCEAU states that it has established dissemination mechanisms to inform the public about the I&D system.

I&D procedures that meet the SMO 6 benchmark are foundational to maintaining public trust and confidence in the profession. CCEAU's system continues to have gaps in this regard since its last Action Plan update in 2017. It is strongly recommended that it invest resources in strengthening its procedures and connect with other PAOs that have overcome similar obstacles to formulate a plan for progressing in this area.

Given that some professional accountants are subject to the I&D mechanism carried out by the Central Bank of the Republic (BCU), the CCEAU should also share SMO 6 components with the BCU and support the adoption of a national I&D system that is in line with the best practices of SMO 6. This would significantly help align the jurisdictional I&D system with SMO 6 requirements.

Lastly, the CCEAU is also encouraged to promote the need for a mandatory I&D system for all public accountants in Uruguay.

Current Status: Consider

Although the Permanent Commission of Adequate Accounting Standards (CPNCA) within the Ministry of Economy and Finance is responsible for the adoption of corporate accounting standards, the CCEAU actively participates and contributes to the standard-setting process as the primary technical resource for the CPNCA. The association nominates members to sit on the Commission and played a crucial role in driving the legislative reform that adopted IFRS for application by public interest entities in 2010 and IFRS for Small and Medium-sized Entities (SMEs) in 2014 within the country.

The CCEAU indicates that it supports its members' implementation of the standards by providing training activities on both IFRS and IFRS for SMEs, monitoring and disseminating information on the international developments in this area, and offering the Inter-American Accounting Association IFRS for SMEs certification. In addition, the CCEAU details that it organizes forums and dialogues with relevant stakeholders, such as Business Chambers, the Central Bank of the Republic, and universities, to discuss the implementation of IFRS.

Lastly, the CCEAU is a member of Latin American Accounting Standard Setters Group (GLENIF) and participates in the international standard-setting process by providing comments to exposure drafts which are collated through GLENIF at a regional level.

CCAEU has demonstrated that, within the scope of its authority, it is committed to meet the SMO 7 obligations and has established ongoing processes to maintain compliance.

Current Status: Sustain