Welcome to IFAC's Professional Accountants in Business Committee (PAIB) eNews.

In This Issue

GOVERNANCE, RISK, AND CONTROL
1. Internal Control Guidance Published as Executive Summary; Available for Local Customization
2. IFAC Staff Discuss Risk Management at ICAP CFO Conference
3. Updated Internal Control Framework Released by COSO
4. Conference on ISO Risk Management Standard to be Held in Toronto 

INTEGRATED AND SUSTAINABILITY REPORTING
5. IIRC Releases Integrated Reporting Framework
6. Proposed Sustainability Accounting Standards Released by SASB
7. GRI Global Conference Approaching
8. New Report Argues Business Case for Natural Capital

EVENTS
9. World Congross of Accountants 2014 to be Held in Rome; Sponsorship Opportunities Available

GOVERNANCE, RISK AND CONTROL 

1. Internal Control Guidance Highlights Published as Executive Summary; Available for Local Customization

The Professional Accountants in Business Committee recently published Evaluating and Improving Internal Control in Organizations: Executive Summary, part of the International Good Practice Guidance series. The condensed version of the guidance summarizes the principles and the importance of effective systems of internal control, as well as explains some of the pitfalls that can be avoided. The executive summary is available to IFAC members and associates for local customization and/or translation. If your organization is interested, please visit the Translations and Permissions page of the IFAC website for the permission request form, which will need to be completed and submitted to permissions@ifac.org. If you have any questions, please contact Vincent Tophoff.

2. IFAC Staff Discuss Risk Management at ICAP CFO Conference

IFAC staff recently participated in the Institute of Chartered Accountants of Pakistan (ICAP)’s CFO Conference, lecturing on current trends and thinking in risk management and best practices. The presentation, Strategic Risk Management in the Face of Uncertainty and Unexpected Risks, is available on the IFAC website.

3. Updated Internal Control Framework Released by COSO

The Committee of Sponsoring Organizations of the Treadway Commission (COSO)  recently released the revised version of Internal Control-Integrated Framework to improve implementation of internal control.

Changes within the Framework include:

• articulating the fundamental concepts underlying the five components by highlighting 17 guiding principles and more detailed points of focus;
• accounting for environmental changes, such as increased globalization, complexity, and regulation, the growing importance of technology, and increased expectations for better governance oversight and fraud prevention;
• expanding the operations objective from “effective and efficient use of the entity’s resources” to “effectiveness and efficiency of the entity’s operations, including operational and financial performance goals, and safeguarding assets against loss”;
• broadening the reporting objective from “published financial statements” to “internal and external financial and non-financial reporting”; and
• providing additional approaches and examples relevant to operations, compliance, and non-financial reporting objectives.

The PAIB Committee has been closely involved in the revision, with two representatives on the COSO advisory council for the project. The PAIB Committee also submitted formal comment letters to both COSO internal control exposure drafts.

4. Conference on ISO Risk Management Standard to be Held in Toronto

The 2^nd International Conference on ISO 31000 [Risk Management] Standard will be held May 28-31, 2013, in Toronto, Canada. ISO 3100—Risk Management provides principles, framework, and a process for managing risk. It can help organizations increase the likelihood of achieving objectives, improve the identification of opportunities and threats, and effectively allocate and use resources for risk treatment. IFAC staff will be presenting on how to leverage ISO 31000 for effective integration of risk management and internal control.

INTEGRATED AND SUSTAINABILITY REPORTING 

5. IIRC Releases Integrated Reporting Framework

The landmark International Integrated Reporting Framework has been released by the International Integrated Reporting Council (IIRC). The Framework is expected to be a critical tool for businesses as they create integrated reports and drive integrated thinking in their organizations. The IIRC is asking all stakeholders to provide feedback on the Framework during its public consultation period, which closes July 15, 2013. The Framework has been released in English but will also be available soon in additional languages. IFAC, a partner in this global effort, encourages all professional accountants to provide feedback.

In support of the Framework, IFAC, the Chartered Institute of Management Accountants, and PwC released Business Model: A Background Paper for Integrated Reporting, which addresses the wide variation in how organizations define their business models and approaches. The paper provides background and context on how business model reporting should be undertaken in an integrated report and suggests content for business model reporting requirements, which are included in the proposed Framework. The proposed definition and guidance in the paper aim to bridge the varied interpretations by highlighting commonalities and ensuring a broad and inclusive application across industries and sectors. Additional background papers are available on the IIRC website.

6. Proposed Sustainability Accounting Standards Released by SASB

The Sustainability Accounting Standards Board (SASB) has released a set of proposed sustainability accounting standards for the financial sector. Industries included in this sector are: asset management and custody activities, investment banking and brokerage, commercial banking, consumer finance, mortgage finance, security and commodity exchanges, and insurance. The public comment period closes on June 14, 2013.

7. GRI Global Conference Approaching

The Global Reporting Initiative (GRI) is holding the Global Conference on Sustainability and Reporting in Amsterdam, the Netherlands, May 22-24, 2013. The conference will provide the opportunity to connect, share successful strategies, and collaborate on efforts to build a sustainable global economy. Additionally, the latest evolution of GRI’s Sustainability Reporting Guidelines (G4) will be released at the conference. GRI expects more than 1,500 leaders and practitioners from over 70 countries, including representatives from business, financial institutions, civil society, international organizations, governments, labor, and academia.

8. New Report Argues Business Case for Natural Capital

Organisational Change for Natural Capital Management, released by The Economics of Ecosystems and Biodiversity (TEEB) for Business Coalition, describes how business leaders can strategize and implement changes in organizational behavior related to valuing natural capital in their companies. The TEEB for Business Coalition, which includes IFAC, supports the development of natural and social capital valuation in business, including providing a compelling economic case for the conservation of natural capital as the cornerstone of green economic policies. 

EVENTS

9. World Congress of Accountants 2014 to be Held in Rome; Sponsorship Opportunities Available

The next World Congress of Accountants (WCOA) will be hosted by the Consiglio Nazionale dei Dottori Commercialisti e degli Esperti Contabili (CNDCEC) in Rome, Italy, in 2014. Themed 2020 Vision: Learning from the Past, Building the Future, the 2014 WCOA will be held November 10-13 at the Auditorium Parco della Musica. More than 4,000 professionals from all over the world will convene at this can’t-miss IFAC event, held every four years. WCOA 2014 will look back to explore the evolution of the accountancy profession and forward to showcase the innovations that will set the tone for the future

The WCOA also affords an unparalleled opportunity for organizations and firms to share their projects and visions with the world by taking advantage of one of our carefully crafted sponsorship packages. There are numerous options so you’ll be able to select the one that best suits your organization’s unique strategy and goals. For more information, please contact info@wcoa2014rome.com or Dimarco@wcoa2014rome.com.

More than 150 attendees from 14 ASEAN and other nations gathered this week at a symposium, ASEAN Capital Markets—The Importance of a Strong Financial Reporting Environment, to discuss strategies for building investor confidence through a strong financial reporting infrastructure that supports the integrity of the ASEAN capital markets.

The event was organized by the Global Public Policy Committee (GPPC) and the International Federation of Accountants (IFAC), and supported by the Institute of Certified Public Accountants of Singapore (ICPAS), US-ASEAN Business Council (USABC), and Asian Corporate Governance Association (ACGA).

The symposium was opened by Mrs. Josephine Teo, Minister of State, Singapore Ministry of Finance and Ministry of Transport. Attendees included senior government officials and policy makers, senior company executives, company directors and audit committee members, investors, audit regulators, and leaders of the accounting and auditing profession.

The moderated panel discussions included: “Setting the Scene: The ASEAN Community and its Capital Markets,” “A Strong Financial Reporting Infrastructure: Vital for a Growing Economy and Strong Capital Market,” “The Future of Audit,” “Independent Oversight of Auditors,” and “Corporate Governance in the ASEAN Region.” An overriding theme was the importance of high-quality financial reporting, which is essential for investor confidence and economic growth.

“The discussions today highlighted the important contributions of all participants in the financial reporting supply chain to the quality of financial information,” said IFAC President Warren Allen. “It is essential that all participants—including companies, the accounting and auditing profession, and the regulatory community—embrace a process of continuous improvement.”

Economic integration is one of the key strategic goals of ASEAN. At the 22nd ASEAN Summit in Brunei in April, the formation of the ASEAN Economic Community by 2015 was highlighted as an important goal—and one that is expected to increase opportunities for ASEAN member states to prosper.

“Today's symposium provides an important platform for the profession and other stakeholders to exchange views on the particular financial reporting challenges and opportunities here in the ASEAN region,” noted Beth Brooke, Global Vice Chair of Public Policy, Ernst & Young. “This ASEAN perspective and voice is vital to the global debate on how best to promote investor confidence in financial reporting and audit.”

“As the national accountancy body, ICPAS is pleased to have worked with IFAC and the GPPC to organize this symposium and bring various stakeholders from ASEAN and further afield to Singapore. The symposium’s topics on building a strong financial reporting infrastructure, raising audit quality, and promoting corporate governance are aligned with our Institute’s goals to advance and promote the accountancy profession. In particular, the discussion on financial reporting ecosystems provided valuable ideas on how the various stakeholders can establish stronger integrated ASEAN capital markets,” said Dr Ernest Kan, President of ICPAS.

“ACGA was happy to support the ASEAN Capital Markets Symposium,” said Jamie Allen, Secretary General. “Robust auditing, financial reporting, and corporate governance standards go hand in hand and are important for ASEAN economic integration.”

USABC Vice President Marc Mealy noted, “The USABC is pleased to be part of this initiative by the accounting profession to support ASEAN's efforts to become more of a global investment asset class by strengthening its regional financial reporting and corporate governance benchmarks and standards.”

About IFAC
IFAC is the global 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 is comprised of 172 members and associates in 129 countries and jurisdictions, representing approximately 2.5 million accountants in public practice, education, government service, industry, and commerce.

About the GPPC
The GPPC is the global forum from the six largest international accounting networks: BDO, Deloitte, Ernst & Young, Grant Thornton, KPMG and PwC.  Its public interest objective is to enhance quality in auditing and financial reporting.

About the Institute of Certified Public Accountants of Singapore
Established in 1963, Institute of Certified Public Accountants of Singapore (ICPAS) is the national accountancy body that develops, supports and enhances the integrity, status and interests of the profession.

The Certified Public Accountant Singapore (CPA Singapore) is a professional in accountancy, finance and business distinguished by their technical expertise, integrity and professionalism, in addition to a recognised accountancy qualification and relevant work experience. CPAs Singapore serve every corner of the world in every industry. Many of them helm some of the most prominent local and international corporations.

ICPAS accords the CPA Singapore designation. Working closely alongside businesses, ICPAS connects its membership to an unmatched range of information resources, events, professional development and networking opportunities. Presently, there are more than 26,000 members making their strides in businesses across all industries in Singapore and around the world.

ICPAS’ international outlook and connections are reflected in its membership of regional and international professional organisations like the ASEAN Federation of Accountants (AFA), the Asia-Oceania Tax Consultants’ Association (AOTCA), the International Federation of Accountants (IFAC) and International Innovation Network (IIN).

Meeting Highlights and Podcast

The IESBA handbook contains the entire Code of Ethics for Professional Accountants, effective January 1, 2011. The 2013 edition includes the three final pronouncements—addressing a breach of a requirement of the Code, conflicts of interest, and the definition of "engagement team"—published in March 2013 (effective dates in 2014). It replaces the 2012 edition of the IESBA handbook.

The handbook is available in print for US $60.00 (plus shipping & handling). Order print copies using the Purchase button.

IFAC CEO Fayez Choudhury speaks with Michael Cohn of accountingTODAY.com on:

• His priorities and direction for IFAC 
• IFAC's succession plan
• The role of the profession in the developing world
• IFAC's big tent covering small practices to large firms
• The accountant's role in preventing a future financial crisis

This Executive Summary of Evaluating and Improving Internal Control in Organizations is part of the International Good Practice Guidance series. The condensed version summarizes the principles and the importance of effective systems of internal control, as well as explains some of the pitfalls that can be avoided.

The Confederation of Asian and Pacific Accountants (CAPA) has received a World Bank grant for the Program to Strengthen Accounting Capacity in Mongolia, Philippines and Vietnam: Improving Continuing Professional Development (CPD) Systems of National Professional Accounting Organisations (PAOs).

The General Procurement Notice (GPN), Request for Expression of Interest (REOI), including the Terms of Reference, is available on the UN Development Business website (registration required to view the full documents).

The opportunity to respond is open to any suitable organization or firm. The closing date for submission of the REOI is midnight of May 2, 2013 (Kuala Lumpur time).

The procurement is being conducted in accordance with the Guidelines: Selection and Employment of Consultants [under IBRD Loans and IDA Credits & Grants] by World Bank Borrowers—January 2011 (“Consultant Guidelines”).

The Governance Self-Assessment for Professional Accountancy Organizations is an assessment tool developed to assist professional accountancy organizations in reviewing how they meet the principles and practices of the Model Guide for Professional Accountancy Organizations and Evaluating and Improving Governance in Organizations

IFAC has developed this Model Guide based on Good Governance: A Code for the Voluntary and Community Sector (The Code), created by the Code Steering Group, comprised of the Association for Chief Executive Officers (ACEVO), the Charity Trustee Networks (CTN), the Institute of Chartered Secretaries and Administrators (ICSA), and the National Council for Voluntary Organisations (NCVO), and supported by the Charity Commission for England and Wales. The Model Guide has been specifically developed to assist PAOs in

The International Public Sector Accounting Standards Board (IPSASB) has released for comment the fourth Exposure Draft (ED) related to its project to develop a Conceptual Framework for the general purpose financial reporting of public sector entities. The Conceptual Framework continues to be the IPSASB’s key strategic objective and is of fundamental importance to the future of global public sector standard setting.

Conceptual Framework Exposure Draft 4, Conceptual Framework for General Purpose Financial Reporting by Public Sector Entities: Presentation in General Purpose Financial Reports, further develops and modifies the conceptual approach highlighted in the Consultation Paper (CP) published in 2012 and reflects the IPSASB’s consideration of the responses to that CP. It builds on the first four chapters of the Conceptual Framework, which were published last January.

The ED describes presentation as the selection, location and organization of information that is displayed and disclosed in General Purpose Financial Reports (GPFRs). GPFRs include both financial statements and other reports providing additional information that enhances, complements, and supplements the financial statements.

The ED also describes display and disclosure, and identifies three presentation decisions—information selection, location, and organization. Presentation decisions are made at two levels:

• High-level decisions that may result in development of a new report, movement of information between reports, or the amalgamation of existing reports; and
• Detailed decisions related to information selection, location, and organization within a report.

Presentation decisions are made:

• In response to the needs of users for information about economic or other phenomena;
• To support the financial reporting objectives; and
• Through application of the qualitative characteristics and constraints on information in financial reports.

Presentation concepts are strongly linked to other parts of the Conceptual Framework and the ED explains those linkages.

“This Exposure Draft is a further step in the development of a Conceptual Framework that reflects public sector circumstances and, when finalized, will underpin IPSASB’s standard-setting activities for many years to come,” said IPSASB Chair Andreas Bergmann. “It proposes presentation concepts applicable to all GPFRs. This is the first time that an international standard setter has developed presentation concepts applicable to both financial statements and additional information and reports that enhance, complement, and supplement the financial statements. Therefore this ED explores new ground and we strongly encourage all stakeholders to submit comments on the proposals in it.”

How to Comment
To access the Exposure Draft and the At-a-Glance document, which provides a summary of the Exposure Draft, or to submit a comment, visit the IPSASB website.

Comments on the Exposure Draft are requested by August 15, 2013. The IPSASB encourages IFAC members, associates, and regional accountancy bodies to promote the availability of this document to their members and employees.

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