IFAC (the International Federation of Accountants) today urged G20 countries to pursue smart regulation, heightened transparency, and inclusive growth to embrace Japan’s vision for an innovative and intelligent “Society 5.0”.
At a time of economic and political uncertainty, IFAC’s recommendations focus on actions that will strengthen the economy, ensure progress toward the Sustainable Development Goals, and create a fair and empowered digital economy
“While growth has returned to most economies, substantial uncertainty and downside risk remain, along with the temptation for unilateral policy actions,” said IFAC CEO Kevin Dancey. “We urge leaders to collaborate on solutions to evolving global challenges, and to ensure more citizens are able to enjoy the benefits of the digital age.”
Ongoing tax and trade tensions demonstrate the desire for nations to act unilaterally on impactful issues. IFAC urges G20 countries to ensure a coherent, transparent global regulatory environment that limits fragmented regulatory regimes. The immense cost to the global economy—more than $780 billion USD annually in the financial sector—is unsustainable.
Another G20 concern is addressing the needs of an aging society, which requires robust and resilient public sector practices. Accrual-based public sector accounting helps governments to develop a more accurate picture of national income, costs, assets and obligations. The result is increased transparency and accountability, and more informed decision-making to plan for the long-term.
G20 countries play a crucial role in fostering institutions and governance models that can anticipate, respond to, and optimize rapid technological change. IFAC issues these recommendations in advance of the 2019 G20 Summit in Osaka, Japan on June 28-29.
We write to share a brief update on our latest initiative to support global standard setting and to better leverage the coordination opportunities between our two boards.
With global regulatory fragmentation risk on the rise, and greater international collaboration on the forthcoming G20 agenda, it is a pleasure to advise that last month we convened a meeting in Paris with national audit and ethics standard-setting organizations representing 17 jurisdictions.
We spontaneously dubbed this four-way dialogue (IAASB + IESBA + national audit & assurance + ethics standards setters) a “quadrilogue”. The name has stuck—along with the goodwill the event created!
The discussions marked the beginning of an exploratory and evolutionary process for the IAASB and IESBA to work with national standard setters, and for national standard setters to work with each other, to consider new ideas in pursuit of mutually shared objectives.
The meeting advanced already-significant IAASB and IESBA coordination efforts, which acknowledge the importance of audit and ethics standards to audit quality. The meeting facilitated further collaboration between a number of national audit & assurance standard setters and the IAASB, as well as identifying ways national standard setters can work more effectively together in the interests of international standard setting.
Some important themes emerged from the “quadrilogue”:
The value of continued IAASB and IESBA coordination, the significant advances made to-date, and how it serves as a catalyst for national coordination;
The importance of early coordination between our two boards, and increased stakeholder communications about it;
Recognition that it is important to identify the areas where four-way engagement makes most sense; and
Quality management within accountancy firms, implications of technology developments, stakeholder engagement, and enhanced implementations activities are possible topics for further exploration.
Yours sincerely,
Arnold Schilder and Stavros Thomadakis IAASB and IESBA Chairs
