Over 50 senior audit professionals from 24 international networks of accounting firms met yesterday to share their perspectives on the topic of audit quality. The symposium, organized by the Forum of Firms, assembled a group of experts to discuss several elements of audit quality, in support of work currently being undertaken specifically by the International Auditing and Assurance Standards Board (IAASB).

"This symposium was designed to encourage participants to exchange views on audit quality from the perspectives of different stakeholders, including users, practitioners, and audit committees,” said David Maxwell, chair, Transnational Auditors Committee. “The discussion raised questions on how audit quality should be defined, as well as ideas for practitioners to consider implementing in their audits.”

The symposium commenced with an overview of the IAASB’s project to develop an international framework for audit quality. Set against this backdrop, the first of two panels debated the expectations of auditors by investors, regulators, and management and the role that those charged with governance have in contributing to audit quality. Having an understanding of the multiple perspectives on audit quality, participants then considered what practitioners can do to drive audit quality by focusing on the “audit inputs”—namely audit firm culture, qualities of audit personnel, and audit process.

"Audit quality is a topic that runs right to the core of the Forum of Firms mandate and mission—the more we all understand it, the more we all can do to strengthen it,” said Robert Dohrer, chair, Forum of Firms. “It is essential that all audit firms be engaged in the debate on this topic so that we can better consider how, as practitioners, we can better contribute to its advancement.”

About the Forum of Firms
The Forum of Firms is an association of networks of international accounting firms that perform transnational audits. Members of the Forum have committed to adhere to and promote the consistent application of high-quality audit practices worldwide, including the use of International Standards on Auditing, and the maintenance of appropriate quality control standards in accordance with International Standards on Quality Control issued by the International Auditing and Assurance Standards Board. Through their organizations, members also conduct globally coordinated internal quality assurance reviews on a regular basis and have policies and methodologies that conform to the Code of Ethics for Professional Accountants. The Transnational Auditors Committee is the Executive Committee of the Forum of Firms and a committee of the International Federation of Accountants.

The International Ethics Standards Board for Accountants (IESBA) is an independent standard-setting body that develops and issues the Code of Ethics for Professional Accountants. The Code includes standards on auditor independence but is intended to apply to the actions and decisions of all professional accountants, including those in business. The structures and processes that support the operations of the IESBA are facilitated by the International Federation of Accountants (IFAC).

On behalf of the IESBA, IFAC is seeking an exceptional individual to serve as a Chair on a remunerated basis, for a minimum of 100 days per year, beginning January 2013. By mutual agreement this commitment could be increased up to and including a full time role. The IESBA Chair is appointed for a three-year term by the IFAC Board with approval by the Public Interest Oversight Board.*

The objective of the IESBA is to serve the public interest by setting, independently and under its own authority, high-quality ethical standards for professional accountants and by facilitating the convergence of international and national ethical standards, thereby enhancing the quality and consistency of services provided by professional accountants throughout the world and strengthening public confidence in the global accountancy profession. The Chair provides leadership to the IESBA in achieving these objectives. A key function of the Chair is to enable, encourage, and promote a deeper understanding by stakeholders and the public of the strategies and activities of the IESBA.

The Chair will also lead the strategic direction of the IESBA, working closely with IESBA senior staff, and facilitate the deliberative and consultative processes that underpin the authority of the IESBA and the legitimacy of its standards and activities. In addition, the Chair will be involved in developing and maintaining effective relationships with national standard setters, regulators, and other key stakeholders.

The successful candidate should have effective leadership, communication, and strategic skills; demonstrated technical and professional competency; and a commitment to the IESBA and its mission to protect the public interest. He or she will have very significant and senior experience. Exposure to professional ethical issues at a national, regional, or international level would be an asset, as would familiarity with regulatory and standard-setting processes. Only individuals who possess the highest integrity will be considered. The position is not restricted to professional accountants. However, any professional accountant applying for the position must have had no direct relationship with an audit firm for at least three years.

For further information about the position, please see the Call for Applications, Chair of the IESBA on the IFAC website at www.ifac.org/careers. Applications are due by February 10, 2012.

*Notes to Editors

The international Public Interest Oversight Board (PIOB) was established in February 2005 to ensure that international auditing and assurance, ethics, and education standards for the accountancy profession are set in a transparent manner that reflects the public interest. The objective of the PIOB is to increase confidence of investors and others that such activities, including the setting of standards by the IESBA, are properly responsive to the public interest. PIOB members are nominated by international institutions and regulatory bodies.

About IFAC

IFAC is the worldwide organization for the accountancy profession dedicated to serving the public interest by strengthening the profession and contributing to the development of strong international economies. IFAC’s current membership consists of over 164 professional accountancy bodies in 125 countries, representing approximately 2.5 million accountants in public practice, education, government service, industry and commerce. In addition to supporting the setting of ethical standards through the IESBA, IFAC supports the setting of auditing and assurance, education, and public sector accounting standards and develops guidance to encourage high-quality performance by professional accountants in business.

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The Private Sector Taskforce of Regulated Professions and Industries was established in May 2011 at the request of the Presidency of the G20. The 2011 report provided the G20 with an analysis of the development of financial policy and regulation, with the aim of facilitating economic stability in the world’s capital markets. The benefits of regulatory convergence were identified, as well as the inefficiencies and associated costs created by regulatory gaps.

Objective

To review the appropriateness of the content of the IAPSs and determine whether they should be withdrawn or revised and the authority of IAPSs and any other implementation guidance that the IAASB may develop.

Background

Six IAPSs are currently effective:

Objective

To develop guidance for auditors dealing with complex financial instruments.

Project Status

Consultation Paper - IPSASs and Government Finance Statistics Reporting Guidelines published on October 17, 2012 with a comment date of March 31, 2013. 

IFAC CEO Ian Ball comments on the FT's commentary – as well as the policy debate – on the sovereign debt crisis.

IFAC Staff members recently visited Beirut, Lebanon on the invitation of the Lebanese Association of Certified Public Accountants (LACPA) to educate its Board of Directors and membership following recent changes in leadership.

IFAC staff held a number of meetings with LACPA leadership, general membership, and key counterparts of LACPA. Most importantly, IFAC Staff held two five-hour meetings--the first meeting with the Board of LACPA. This meeting covered not only the details of the SMOs, but included a working session for the Board, which identified and considered best practices and potential solutions which may facilitate LACPA compliance with IFAC SMOs and the finalization of an Action Plan.

The second meeting worked to raise awareness of the importance of the SMOs and to garner support among the general membership for the need for reform in-line with IFAC SMOs. One hundred and twenty participants attended this meeting to hear a formal powerpoint presentation on the SMOs and participate in an open discussion forum focused on LACPA’s leadership proposed plans to address areas of weakness.

This paper outlines the rationale for the regulatory arrangements put in place for setting international standards for auditing and assurance, ethics, and accounting education; arrangements in which responsibility is shared between the public sector and the private sector. Current arrangements for international standard setting, which encompass a combination of public and private sector roles, provide a structure and process that operate and are seen to operate in the public interest, in a context in which there are needs for legitimacy, independence, transparency, performan