Consejo General de Economistas de España

In Spain, the Instituto de Contabilidad y Auditoría de Cuentas (ICAC), an organization within the Ministry of Economy, Industry and Competitiveness, is responsible for the adoption and implementation of a quality assurance (QA) review system; accordingly, ICAC has established a QA system for auditors of all public interest entities (PIEs), including listed entities, credit institutions, insurance companies, and financial brokerage companies as well as non-PIEs.

The Consejo General de Economistas de España (CGE) plays a key role in supporting the implementation of the QA review system through its agreement with ICAC to undertake ‘instrumental tasks’ in QA inspections of auditors of non-PIEs in partnership with the ICJCE. In addition, the CGE participates in the ICAC’s Audit Standards Group, which is responsible for adopting relevant standards. The CGE reports ongoing activities to ensure that the QA review systems incorporate all SMO 1 requirements and to provide CGE’s reviewers with the tools and knowledge needed to perform QA reviews.

The CGE has developed an Internal Organization Manual (MOI) model with policies, procedures, and explanatory material aligned with the quality management standards to support its members with the QA review process. The CGE undertakes additional activities in this area, such as offering consultations for members’ regarding quality management standards and their implementation, including standard-related topics in its training activities; and disseminating information on the QA review systems.

The CGE has demonstrated a process to fulfill the SMO 1 obligations within its scope of authority and is committed to continuous improvement.

Current Status: Sustain

Law 22/2015 in Spain establishes initial and continuing professional development (IPD and CPD) requirements for auditors. The Consejo General de Economistas de España (CGE) reports that its role with implementation of the IES requirements at the national level is: (i) participation on the ICAC’s Audit Committee, which is responsible for establishing CPD requirements and creating the final exam for auditors; (ii) providing CPD training, alongside other professional accountancy organizations and educational centers; and (iii) participation on the ICAC’s Assessment Board to prepare the final exam. Through these activities the CGE promotes the adoption of all IES requirements.

The CGE also collaborates with the University of Madrid on its master’s degree in Auditing and Higher Accounting with respect to IES 1 and entry into the audit profession. It engages with the university about the curricula and professional competencies needed to sit for the first aptitude exam.

The audit profession is the only formally / legally regulated segment in Spain. However, the CGE has established its education requirements for other accountancy professionals who wish to voluntarily join its membership. In partnership with the Instituto de Censores Jurados de Cuentas de España, the institutes have established a voluntary Registry for Accounting Experts (REC]). RECs are expected to complete an initial education program, an exam, and practical experience. The CGE also offers CPD programming regularly during the year. In 2024, the CGE completed the IES Checklist developed by IFAC and confirmed that the REC educational requirements are aligned with the latest IES.

The CGE’s efforts in this area are commendable, as education is the foundation of capable, competent professionals. The CGE is encouraged to consider expanding the voluntary certification model it has established for REC] to the other membership categories or registries it maintains that relate to the accountancy profession.

Current Status: Sustain

The CGE is not legally responsible for adopting auditing standards in Spain. Still, it does support the Instituto de Contabilidad y Auditoría de Cuentas (ICAC) and its standard-setting process of the Spanish Generally Accepted Auditing Standards (Spanish GAAS). National legislation stipulates that Spanish GAAS are ISA adapted for their application in Spain and also include Spain-based technical standards.

The recognized professional accountancy organizations draft the Spanish Generally Accepted Auditing Standards based on ISA (NIA-ES as adopted in Spain). The ICAC formally approves and publishes the standards and requires all companies to apply them. As of 2024, the 2022 ISA are being applied.

The CGE participates in the Audit Standards Group of ICAC, where the adoption of new and revised ISA are analyzed, and add-ons and carve-outs are determined. Furthermore, the CGE reports that it has established an ongoing process to monitor and review translations of new and amended standards for incorporation into national requirements and will provide comments on the IAASB exposure drafts.

To assist its members with implementation, the CGE has undertaken various activities. It includes standard-related topics in its training and continuing professional development programs, disseminates information on updates and revisions to ISA, and prepares guidance material.

The CGE has demonstrated a process to fulfill the SMO 3 obligations within the scope of its authority and is committed to continuous improvement.

Current Status: Sustain

In Spain, national legislation only mandates auditors to adhere to ethical requirements set by the Instituto de Contabilidad y Auditoría de Cuentas (ICAC). The general ethical requirements and independence requirements specified in Law 22/2015 are reported to be more restrictive than what is contained in the IESBA Code as related to independence requirements. The Law also authorizes the ICAC to establish further ethical standards. However, the ICAC has not yet done so.

To promote the adoption of the International Code of Ethics, the Consejo General de Economistas de España (CGE) reports that it participated in a working group formed by the ICAC in 2012 to develop a set of ethics standards aside from independence requirements. However, ICAC stopped this work in 2013. To further the dialogue, the CGE has met with ICAC several times to discuss the transposition of the EU Audit reform and to use the International Code of Ethics issued by the IESBA as a benchmark for ethical requirements. The CGE reports establishing an ongoing process to monitor new and amended ethics standards as part of its advocacy efforts.

Meanwhile, the CGE has also developed its own Code of Ethics for its voluntary membership. It was updated in 2023 to be based on the 2022 version of the International Code of Ethics for Professional Accountants as a supplement to its own Code.

To support the implementation of its Code of Ethics, the CGE has established educational programs and includes discussions on ethical standards as part of the conferences and seminars it organizes. The CGE disseminates information about updates to its Code through its website.

It is in the public interest that all professional accountants adhere to the latest ethical requirements issued by the IESBA. The CGE is encouraged to continue pursuing a convergence process to eliminate differences between its Code and the International Code of Ethics. The 2023 Handbook is currently effective.

Current Status: Review & Improve

The Ministry of Finance (MoF) is the entity that is legally responsible for setting public sector accounting standards. In 2010, the MoF adopted National Public Sector Accounting Standards for all public sector entities based on accrual IPSAS. The Consejo General de Economistas de España (CGE) indicates that it uses its best endeavors to continue to promote the adoption of IPSAS and support implementation.

The CGE has established a Public Sector Committee under its Register of Auditor Economists (REA), whose objectives are to promote relations with public institutions at the state and regional level, promote public-private collaboration, and improve corporate auditors’ knowledge of the public sector. To this end, CGE organizes specific public sector conferences and publications.

The CGE also reports monitoring the standards and pronouncements issued by the IPSASB.

The CGE has demonstrated a process to fulfill the SMO 5 obligations within the scope of its authority and is committed to continuous improvement.

Current Status: Sustain

The Instituto de Contabilidad y Auditoría de Cuentas (ICAC) has the authority to carry out investigative and disciplinary (I&D) processes for auditors in accordance with Law 22/2015, which is stated to meet the SMO 6 benchmark. Additionally, as a professional accountancy organization with voluntary membership, the Consejo General de Economistas de España (CGE) has established an I&D system for its members. Importantly, the CGE notes that its system is complementary to the ICAC’s system, and its framework relates to the investigations initiated and sanctions issued internally by the CGE for its members.

All members of the CGE must comply with the rules and principles included in the CGE Code of Ethics of the profession and if non-compliance is confirmed, an individual can be expelled from membership. The CGE has a recognized disciplinary system with two committees that may identify infractions and define sanctions. The CGE has completed a self-assessment of its I&D system against the SMO 6 benchmark and reports alignment.

The CGE has demonstrated a process to fulfill the SMO 6 obligations within the scope of its authority and is committed to continuous improvement.

Current Status: Sustain

In Spain, the Instituto de Contabilidad y Auditoría de Cuentas (ICAC)—an organization within the Ministry of Economy, Industry and Competitiveness—is responsible for proposing and adopting Spanish General Accounting Plan (Spanish GAAP) adapted to EU Regulations and harmonized with EU-endorsed standards. EU-endorsed IFRS are adopted for publicly traded companies.

The Consejo General de Economistas de España (CGE) participates in the ICAC’s Corporate Information Council. Through its representation on this Council, the CGE actively promotes adopting IFRS fully and maintains an ongoing dialogue with ICAC.

To support the implementation of the national standards (Spanish GAAP) and IFRS, the CGE disseminates information to members and stakeholders on new and revised IASB pronouncements and provides educational courses on IFRS.

Finally, the CGE also states that it participates in the standard-setting process by providing comments on exposure drafts indirectly through its regional membership in the European Federation of Accountants and Auditors for SMEs (EFAA) and directly to the IASB.

The CGE has demonstrated a process to fulfill the SMO 7 obligations and is committed to continuous improvement.

Current Status: Sustain