In This Issue:

1. IESBA Issues Revised Code of Ethics
2. Revisions Strengthen Independence, Clarify Requirements
3. Member Bodies and Firms Encouraged to Develop Implementation Plans
4. Resources Available to Support Adoption and Implementation of Revised Code
5. Ethics Board Launches Process for Developing 2010-2012 Strategic Plan
6. Tell Others About Ethics eNews

1. IESBA Issues Revised Code of Ethics

The International Ethics Standards Board for Accountants (IESBA) issued in July, following the approval and consideration of due process by the Public Interest Oversight Board, a revised Code of Ethics for Professional Accountants (the Code). The revised Code clarifies requirements for all professional accountants and significantly strengthens the independence requirements of auditors.

The Code is effective on January 1, 2011.

The full text of the revised Code can be accessed from the Ethics section of the IFAC online bookstore at www.ifac.org/Store.

2. Revisions Strengthen Independence, Clarify Requirements

The revisions to Code of Ethics for Professional Accountants (the Code) include the following changes, among others, to strengthen the Code's independence requirements:

• Extending the independence requirements for audits of listed entities to all public interest entities;
• Requiring a cooling-off period before certain members of the firm can join public interest audit clients in certain specified positions;
• Extending partner rotation requirements to all key audit partners;
• Strengthening some of the provisions related to the provision of non-assurance services to audit clients;
• Requiring a pre- or post-issuance review if total fees from a public interest audit client exceed 15% of the total fees of the firm for two consecutive years; and
• Prohibiting key audit partners from being evaluated on or compensated for selling non-assurance services to their audit clients.

Also included within the revisions are changes in the drafting conventions used in the Code. These changes, which include the use of the word "shall," present the Code's requirements in clearer, more precise language.

3. Member Bodies and Firms Encouraged to Develop Implementation Plans

Given the effect the revisions to Code of Ethics for Professional Accountants (the Code) will likely have on professional practice, and the fact that they will go into effect less than 18 months from now, member bodies, firms, and other relevant stakeholders are encouraged to develop plans for implementing the revised Code by the effective date of January 1, 2011.

Issues to consider while developing implementation plans would include the implications of:

• Expanded partner rotation requirements;
• New independence requirements for public interest entity audit clients; and
• Expanded requirements related to the provision of non-assurance services to audit clients

4. Resources Available to Support Adoption and Implementation of Revised Code

The IESBA has developed a number of resources to support adoption and implementation efforts for the revised Code of Ethics for Professional Accountants (the Code).

These materials include the following:

• A high-level overview of the Code
• A detailed presentation slide package and speaking notes addressing the independence requirements contained in section 290
• A presentation slide package and speaking notes addressing the independence requirements for audits of public interest entities
• Templates, both high-level and detailed, to help member bodies/firms analyze differences between the requirements in their jurisdiction and the requirements of the revised Code
• Comparisons, both high-level and detailed, to the existing Code
• A short paper describing the changes from the existing Code
• An article for member bodies describing the process of developing the Code, highlighting some key changes and emphasizing the need to start the process of implementation

All of these support materials will be available soon in the Ethics section of the IFAC website (www.ifac.org/Ethics).

5. Ethics Board Launches Process for Developing 2010-2012 Strategic Plan

In April 2009, the IESBA launched a strategic review to develop the 2010-2012 Strategic and Operational Plan.

The IESBA's terms of reference and due process require the strategic review to include a formal survey of key stakeholders' views about issues that they believe should be addressed in the immediate future. The IESBA conducted a short survey to solicit these views in July. The IESBA will consider this feedback as it develops its Strategic Plan which will be exposed for public comment.

To view the 2007-2009 Strategic and Operational Plan, please visit the Ethics section of the IFAC online bookstore at www.ifac.org/Store.

6. Tell Others About Ethics eNews

The IESBA issues regular eNews updates to keep you current on its activities and recent publications. Please forward this eNews to any interested colleagues and advise them that they can subscribe to receive this eNews by following these simple steps:

1. Go to the eNews sign-up page at http://www.ifac.org/E-news/index.tmpl.
2. Enter your email address, name, and country.
3. Select "Ethics eNews" from the checklist, as well as any other eNews alerts that you would like to receive.

The next issue of the Ethics eNews will be delivered directly to you in your inbox.

For more information about any of the items mentioned above or other information about the IESBA, please contact: communications@ifac.org.

About the IESBA and IFAC

The IESBA develops ethical standards and guidance for use by professional accountants. It encourages member bodies of IFAC to adopt high standards of ethics for their members and promotes good ethical practices globally. The Public Interest Oversight Board oversees the activities of the IESBA and, as one element of that oversight, establishes its due process and working procedures.

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 157 members and associates in 123 countries, representing more than 2.5 million accountants in public practice, education, government service, industry, and commerce. Through its independent standard-setting boards, IFAC sets ethics, auditing and assurance, education, and public sector accounting standards. It also issues guidance to encourage high-quality performance by professional accountants in business.

IESBA Staff Issues Materials to Support Adoption and Implementation of the Code

The International Ethics Standards Board for Accountants (IESBA) issued in July, following the approval and consideration of due process by the Public Interest Oversight Board (PIOB), a revised Code of Ethics for Professional Accountants (the Code).

The Code becomes effective on January 1, 2011.

The full text of the revised Code can be accessed at the Ethics section of the IFAC online bookstore at www.ifac.org/Store.

Recognizing the effect these changes will have on professional accountants in practice and business, the IESBA staff has developed a range of materials to facilitate adoption and implementation of the Code. The documents are non-authoritative and are issued for information.

The Adoption and Implementation Materials

The materials include an overview of the revised Code, additional guidance about the independence requirements and a tool to assist jurisdictions in comparing the revised Code to their existing Code.

These materials include:

• PowerPoint Presentations: High level and in-depth that can be used to explain the content of the Code
• Overview of Independence Requirements: A short document providing an overview of the independence requirements contained in Section 290 of the Code of Ethics relating to rotation, cooling off period, provision of non-assurance services, fees and compensation and evaluation policies
• Comparisons: A high level and more detailed comparison that will help people understand the differences between the July 2009 Code and the previous Code
• Template: A comparison template containing the complete text of the Code which can assist individuals who want to understand how the provisions in their jurisdiction match up to the Code.

All of these support materials can be accessed at the Resources section of the IESBA website at www.ifac.org/Ethics/Resources.php.

For more information about any of the items mentioned above or other information about the IESBA, please contact: communications@ifac.org.

The IESBA develops ethical standards and guidance for use by professional accountants. It encourages member bodies of IFAC to adopt high standards of ethics for their members and promotes good ethical practices globally. The Public Interest Oversight Board oversees the activities of the IESBA and, as one element of that oversight, establishes its due process and working procedures.

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 157 members and associates in 123 countries, representing more than 2.5 million accountants in public practice, education, government service, industry and commerce. Through its independent standard-setting boards, IFAC sets ethics, auditing and assurance, education, and public sector accounting standards. It also issues guidance to encourage high quality performance by professional accountants in business.

1. IFAC Accountancy Summit Supports G-20 Response to Financial Crisis

Following the Pittsburgh G-20 Summit held on September 24-25, IFAC expressed support for the G-20's goal to establish "a framework for strong, sustainable, and balanced growth," which includes reform of executive compensation packages, the adoption of a single set of high-quality global accounting standards, and increased resources for the World Bank and international development banks. IFAC recommends that these goals remain priorities and that G-20 leaders act on them at a national level.

In advance of the Pittsburgh G-20 meeting, IFAC hosted in July the G-20 Accountancy Summit, which was attended by over 60 representatives from member bodies in the G-20 countries and other external groups. The Accountancy Summit was designed to generate consensus within the profession on a series of recommendations submitted to the G-20 finance ministers. The Summit also addressed the question of how the profession can best contribute to resolving the financial crisis. The recommendations, if implemented, are designed to strengthen transparency and accountability within the global financial system.

The following recommendations, among others, were developed at the G-20 Accountancy Summit:

• The early adoption and implementation of International Financial Reporting Standards (IFRS), International Standards on Auditing (ISAs), and the auditor independence requirements set out in the Code of Ethics for Professional Accountants
• Stronger corporate governance structures
• Widespread adoption of International Public Sector Accounting Standards (IPSASs) by government
• Greater consideration of the needs of small- and medium-sized entities

The results of the G-20 Summit are available online.

2. IFAC/The Banker Survey Examines SME Lending, Critical Role of Accountants

IFAC and The Banker magazine, part of the Financial Times group, have released the results of a global survey of banks on lending to small- and medium-sized entities (SMEs). The results showed that some SMEs may have access to more credit down the road, but will have to pass more rigorous tests to demonstrate their creditworthiness.

The results of the survey, which received responses from over 500 bankers over a six-week period, also confirmed that accountants play a critical role in providing information that influences lender decision making. Bankers expect SMEs to provide more comprehensive information in their loan applications. Survey respondents said that they will increasingly look at cash-flow information, collateral, and customer history with the bank when considering loan applications. Financial statements, key risk indicators, and industry trends are also among the key sets of information banks focus upon when making loan decisions.

The survey results, including three articles by IFAC leadership that highlight IFAC's support for SMEs and IFAC's belief in the importance of SMEs in contributing to global economic recovery and growth, are printed as a special supplement in the October issue of The Banker. The articles and survey results can also be accessed from the IFAC website.

3. IFAC Hosts SMP Forum in Beijing

The Small and Medium Practices (SMP) Committee held is fourth annual IFAC SMP Forum at the Grand Hyatt, Beijing. Over 200 delegates from more than 40 countries--the largest gathering in the event's history--attended the event, which was co-hosted by the Chinese Institute of Certified Public Accountants and the Confederation of Asian and Pacific Accountants.

The Forum's program featured a broad range of speakers and topics, including recent international developments, the work of the IFAC SMP Committee, as well as presentations by the World Bank and Asian Development Bank, and panel discussions on such topics as "Adapting to the Economic Turbulence and Laying Foundations for Sustainable Growth"; "Ensuring International Standards are Relevant to SMP/SMEss"; and "The Role of SMPs in Providing Business Support to SMEs."

A full set of materials related to the Forum, including streaming video, speeches, presentations, and discussion group reports will be available at the SMP Committee Resources web page.

4. IAASB Releases New Tools to Support Clarity ISA Adoption and Implementation

To promote awareness and understanding of the clarified International Standards on Auditing (ISAs), which were completed in March 2009, the International Auditing and Assurance Standards Board (IAASB) has released a series of modules to support adoption and implementation efforts.

Each "ISA Module" consists of a brief video presentation, a set of slides, and supporting notes that explain the key principles of, and major changes in, individual ISAs. The support modules include the implications for audits of small- and medium-sized entities.

The ISA Modules are available to download free of charge from the IAASB Clarity Center on the IFAC website.  

5. IAASB Staff Issues Q&A Guide on Clarified ISA Implementation, SME Issues

To help auditors worldwide implement the clarified International Standards on Auditing (ISAs), the staff of the International Auditing and Assurance Standards Board (IAASB) has developed a question-and-answer publication titled Applying ISAs Proportionately with the Size and Complexity of an Entity.

The questions and answers explain how the design of the ISAs enables them to be applied in a manner that is proportionate to the specific characteristics of the entity subject to audit. Furthermore, answers are given to questions relating to audit procedures, work effort, documentation, and professional judgment. It is relevant in the context of any audit, but will be of particular help to those who audit, or oversee the audits of, small- and medium-sized entities.

The publication is available for download from the IFAC website.

6. IAASB Consults on Complex Financial Instruments, Greenhouse Gas Emissions

The International Auditing and Assurance Standards Board (IAASB) has released Consultation Papers seeking views on developing new guidance for auditing complex instruments and greenhouse gas emissions reporting.

The first Consultation Paper, entitled Auditing Complet Financial Instruments, recognizes the strong demand from auditors and preparers for further guidance on auditing complex financial instruments, e.g., in situations of illiquid markets, which currently pose the greatest challenges for them. The Consultation Paper refers to recent work by the U.K. Auditing Practices Board (APB) on the same topic, and asks specific questions about how that guidance might be adapted or supplemented for application in the international context.

Comments for this paper are requested by January 15, 2010.

The second paper, titled Assurance on a Greenhouse Gas Statement, asks a number questions in important areas related to the reporting of greenhouse gas emissions, including the following:

• The form of assurance report that users would find most useful
• The nature and extent of requirements
• How a standard should best integrate with regulatory requirements
• Technical aspects of applying the assurance process to greenhouse gas emissions

The IAASB intends to use the feedback from this consultation to develop an exposure draft of a proposed new assurance standard on greenhouse gas emission statements for release in 2010.

Comments for this paper are requested by February 19, 2009.

Both Consultation Papers may be viewed online. Respondents are asked to send their comments electronically through the IFAC website, using the "Submitt a Comment" button on the Exposure Drafts and Consultation Papers page. Please note that first-time users must register to use this new feature.

7. Adoption and Implementation Materials for Revised Ethics Code Now Available

The International Ethics Standards Board for Accountants (IESBA) encourages member bodies and firms to develop plans for implementing the recently revised Code of Ethics for Professional Accountants (the Code). The revisions include strengthening the Code's independence requirements and using the word "shall" as a drafting convention to clarify requirements. The revised Code will take effect January 1, 2011.

The IESBA has developed the following resources to support adoption and implementation:

• Slide Presentations: High level and in-depth that can be used to explain the content of the Code
• Overview of Independence Requirements: A short document providing an overview of the independence requirements contained in Section 290 of the Code relating to rotation, cooling off period, provision of non-assurance services, fees, and compensation and evaluation policies
• Comparisons: A high level and more detailed comparison that will help people understand the differences between the July 2009 Code and the previous Code
• Template: A comparison template containing the complete text of the Code, which can assist individuals who want to understand how the provisions in their jurisdiction match up to the Code

To access these materials, as well as the revised Code, visit the Resources section of the Ethics homepage. 

8. IPSASB/IMF Joint Task Force Achieves Progress

Momentum is building for the joint task force developed by the International Public Sector Accounting Standards Board (IPSASB) and the International Monetary Fund (IMF) to discuss intervention activities conducted by various governments in response to the global financial crisis. The task force is also considering the application of accounting standards for reporting such actions.

The task force has three objectives:
1) To learn how governments are intending to deal with assets, obligations, and commitments acquired as a result of their actions in response to the financial crisis
2) To learn about, and identify the need for any improvements to, accounting standards developed to account for government actions in response to the financial crisis
3) To discuss reporting and valuation approaches for reporting these interventions

The task force has held meetings with five important sets of stakeholders and updated the IPSASB on its progress. It will provide the Board with a draft document summarizing its conclusions on October 31, 2009.

9. IFAC/PAIB Collaborating with Prince of Wales Sustainability Project on Community Site

IFAC and the Professional Accountants in Business (PAIB) Committee continue to collaborate with The Prince of Wales' Accounting for Sustainability (A4S) Project, which has the aim of achieving a common approach to accounting for sustainability across the accountancy profession.

Currently, IFAC and A4S have partnered to develop a community website that will allow accountancy organizations, professionals, and other experts to share ideas, experiences, and views on sustainability issues. The site will also allow participants to work together on a variety of different projects, including case studies, content development, and broader com¬munity outreach to stakeholders, such as investors, academics, and regulators.

Progress on the development of this site will be reported in future IFAC news vehicles.

10. PAIB Issues International Good Practice Guidance on Evaluating and Improving Costing

The Professional Accountants in Business (PAIB) Committee has published new International Good Practice Guidance (IGPG) to help professional accountants make decisions about their approaches to costing.

The IGPG, titled Evaluating and Improving Costing in Organizations, establishes six fundamental principles for evaluating and improving costing methods.

The guidance is targeted to professionals working in commerce, industry, as well as the public sector. It also recognizes the importance of distinguishing between the purposes and information needs of cost accounting to meet the demands of external reporting, cost measurement, and reporting for internal decision support in organizations.

A companion document for the guidance, titled Evaluating the Costing Journey: A Costing Levels Continuum Maturity Model, has also been published to help professional accountants decide upon the level of sophistication in the costing information they will need to provide, given the requirements of their organizations and the needs of managers and employees. The model can help professional accountants exercise professional judgment to assess their organization's existing costing capabilities. IFAC welcomes comments on this model, which is a beta version currently being tested by users for its effectiveness.

11. PAIB Launches Projects on Governance, Risk, and International Control

The Professional Accountants in Business (PAIB) Committee has launched two projects directed at improving guidance in the areas of governance, risk, and internal control.

The first initiative will involve developing a reconciliation of the PAIB Committee's International Good Practice Guidance (IGPG) principles with the OECD Principles of Corporate Governance. This project follows IFAC's recent publication of the IGPG, Evaluating and Improving Governance in Organizations, and IFAC's July submission to the G-20, which identifies corporate governance as a priority for reform.

IFAC's IGPG on governance complements the Organization for Economic Co-operation and Development (OECD) principles as its main purpose is to support PAIBs and to help their organizations evaluate and further improve their governance structures and systems. The IFAC principles help restore the balance between compliance and performance in organizations.

The PAIB Committee is also developing the IGPG, Evaluating and Improving Internal Control in Organizations. The goal will be to provide practical guidance that will focus on common pitfalls in the way current internal control systems are being deployed and what should be done to avoid these pitfalls.

12. IOSCO Issues Statement Supporting Clarity ISAs

The International Organization of Securities Commissions (IOSCO) recognized the important role that International Standards on Auditing (ISAs) play in "facilitating cross-border securities offerings and listings" in a statement.

In the statement, IOSCO encouraged securities regulators to accept audits performed and reported in accordance with the clarified ISAs for cross-border offerings and listings. However, IOSCO recognized that the decision whether to do so will depend on a number of factors and circumstances in their jurisdiction. Furthermore, IOSCO noted the potential role of the clarified ISAs for purely domestic offerings and listings. Consequently, it encourages securities regulators and relevant authorities to consider the clarified ISAs when setting auditing standards for national purposes. However, IOSCO also recognizes that factors at the national and regional level will be relevant to their considerations. 

IFAC welcomes the statement, which echoes support for ISAs recently expressed by the World Bank and the Basel Committee on Banking Supervision.

13. Forum of Firms Workshop Focuses on Strengthening Global Internal Inspection Processes

Over 40 senior audit professionals from 23 international networks of accounting firms met to share their experiences, industry insights, and current practices in establishing and strengthening global internal inspection processes at a workshop recently organized by the Forum of Firms (the Forum).

The workshop featured a panel of experts who discussed new developments and innovations in a variety of areas, including inspection organization, methodology and staffing, practical implementation issues, and processes for internal reporting.

In order to achieve and maintain membership in the Forum, each member firm must follow international professional standards on quality control at the firm level and for each transnational audit engagement.

14. Member Bodies Invited to Rate Competitors in 2009 Articles of Merit Competition

The Professional Accountants in Business (PAIB) Committee has invited professional accountants in business and business leaders to participate in selecting the winner of its 2009 Articles of Merit Award Program. The program seeks to identify commendable articles on financial and management accounting topics that appeared in publications of IFAC member bodies and associates. This year, the PAIB Committee judging panel has nominated 35 articles for the top award.

15. IFAC and International Valuation Standards Council Sign MOU Agreement

IFAC and the International Valuation Standards Council (IVSC) have signed a Memorandum of Understanding (MoU) to enhance their respective impacts on issues surrounding valuations--particularly those related to improving the consistency of global valuation standards affecting the preparation and audits of financial reports.

IFAC and the IVSC will seek collaboration opportunities in areas of common interest, including improving the mutual understanding of valuers and auditors, of standards in relation to financial statements and the auditors' use of experts, and promoting the credibility and acceptability of valuations prepared in accordance with International Valuation Standards. As part of this collaboration, the IVSC has appointed Frank Bollman to serve on the Consultative Advisory Group of the International Auditing and Assurance Standards Board. Mr. Bollman is Managing Director in the European Practice of Duff & Phelps GmbH.

16. Third Annual CReCER Conference Addresses Crisis, SMEs and Public Sector Reporting

The 3rd Annual CReCER (Spanish acronym for Accounting and Accountability for Regional Economic Growth) Conference took place September 23-25 in São Paulo, Brazil. The event, hosted by IFAC, the World Bank, and the Inter-American Development Bank, along with the support of the six largest global accounting networks, was attended by over 1,000 individuals.

The conference is designed to increase awareness of the critical importance of sound financial reporting and auditing for the development of a well-functioning market economy and of an efficient public sector. This year, the conference provided specific perspectives on the global financial crisis.

IFAC President Robert Bunting spoke at the conference, advocating a leadership role for the accounting profession in helping to lead the world out of the financial crisis. He emphasized the importance of supporting small- and medium-sized businesses and the accountancy firms that serve them in recovery from the recession. In addition, he called for governments to adhere to the same high standards of financial reporting as their private sector counterparts.

For more information about any of the items mentioned above or other information about IFAC, please contact communications@ifac.org.

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 157 members and associates in 123 countries and jurisdictions, representing more than 2.5 million accountants in public practice, education, government service, industry and commerce. Through its independent standard-setting boards, IFAC sets international ethics, auditing and assurance, education, and public sector accounting standards. It also issues guidance to encourage high-quality performance by professional accountants in business.

Welcome to the first issue of the IFAC Member Body Development eNews.

IFAC's Member Body Development activities include promoting and supporting the role of professional accountancy organizations, facilitating the work of its members in the adoption and implementation of international standards, collaborating with the donor community to build capacity in emerging economies, and raising awareness about the issues being addressed by the profession globally. These activities are carried out by the Member Body Development staff with advice and consultation from the IFAC Compliance Advisory Panel and the Developing Nations Committee.

The Member Body Development eNews will highlight the work of IFAC members, recognized regional organizations, and acknowledged accountancy groupings, and the development community to strengthen and contribute to the worldwide accountancy profession.

We welcome all of your comments and suggestions for making this new publication even better. For further information, please contact communications@ifac.org.

In this Issue:

1) IFAC Members Focus on Actions and Continuous Improvement
2) Capacity Building Initiatives
3) New IFAC Members and Associates
4) International Standards Adoption - ISA Update
5) Share MBD eNews With Your Colleagues

1) IFAC Members Focus on Actions and Continuous Improvement

The IFAC Member Body COmpliance Program was launched in 2004 to encourage continuous improvement by IFAC members and associates. The foundation of the program is articulated in IFAC's membership requirements (Statements of Membership Obligations (SMOs)). The SMOs cover seven areas of relevance to the profession and focus on promoting the adoption and implementation of international standards, as well as investigation and disciplinary mechanisms and external quality assurance.

The program is currently in the Part 3, Action Plan phase, launched after the initial two phases that were designed to gather information about national standard setting and regulatory frameworks. Action Plans are developed by IFAC members and associates to illustrate how these organizations are addressing SMOs requirements. In the interest of transparency, action plans are published on the IFAC website. To date, 76 organizations have published their Action Plans on the IFAC website with an additional 39 plans under review by the Compliance staff.

The Action Plan process recognizes that IFAC members and associates are at different stages of development and operate in different jurisdictions. However, the primary purpose of the process is to encourage continuous improvement.

 "Participating in the Compliance Program has been a truly meaningful and rewarding experience for CICPA, leading to important improvements in major areas of the development of the accounting profession in China. The Policy Recommendation and Action Plan process, in particular, have been very helpful for us to work out the convergence plan, enhance the quality assurance program, and communicate effectively with regulators, the government, and other key stakeholders." (The Chinese Institute of Certified Public Accountants)

In the coming issues of this eNews, we will be highlighting interesting and insightful developments related to the process.

2) Capacity Building Initiatives

Through Member Body Development activities, IFAC seeks to represent the profession in developing nations, and provide guidance and other resources to meet their needs. IFAC also seeks funding from the donor community for the strengthening of the accountancy profession in developing nations. Some of these initiatives are highlighted below.

West Africa Workshop
In November 2009, several professional accountancy bodies of West Africa participated in the conference organized by the Association of Accountancy Bodies in West Africa (ABWA) in Senegal. In addition to participating in the event, IFAC staff and Developing Nations Committee members organized a workshop attended by 12 of the 15 ABWA member bodies, ABWA leadership, and representatives from the World Bank to focus on the role of professional accountancy organizations and the requirements for IFAC membership. The workshop participants discussed the IFAC membership application process and Member Body Compliance Program. They also discussed the international standard-setting process in the region of West Africa. The economic size and unique regulatory framework of the region has resulted in establishing a regional mechanism coordinating standard setting for the francophone countries in the region.

Outreach in Poland, Latvia, Lithuania
Also in November 2009, Member Body Development staff met with IFAC members in Poland, Lithuania, and Latvia. The meetings with these national professional accountancy organizations served as an opportunity to follow-up on recent developments with regards to implementation of European Union regulations relating to the profession, as well as the progress of their Action Plans. Additional meetings were held with key stakeholders in each country, including representatives of Ministries of Finance and Public Oversight bodies. Information was exchanged on the roles of the profession and the oversight body in meeting EU requirements, and the general progress of oversight mechanisms.

Central America Workshop
IFAC representatives organized and lead discussions at a workshop on the IFAC Action Plan process in Panamá in January 2010. The initiative was proposed and hosted by the Colegio de Contadores Públicos Autorizados de Panamá (CCPAP) with the event being attended by IFAC members in the Dominican Republic, Nicaragua, and Costa Rica, the president of the regional organization, the Inter-American Accounting Association, and a World Bank financial management specialist for the sub-region. Representatives from an accountancy organization in El Salvador also attended the workshop as part of their interest in IFAC membership. Representatives from the member bodies presented on their progress with drafting Action Plans and exchanged experience on region-specific challenges, including strengthening education requirements and providing meaningful implementation support for the international standards being adopted in their countries. A representative from the World Bank also presented on the World Bank perspective of the Action Plan process, noting particular usefulness of the process for the capacity building of the accountancy profession. At the conclusion of the workshop, all participants and presenters agreed that going forward this type of collaborative approach is the best way for progress to be achieved and sustained.

3) New IFAC Members and Associates

During IFAC's 32nd Annual Council Meeting, the IFAC Council approved five new organizations to member or associate status. We congratulate them on this significant achievement.

New Members

1. Iran - Iranian Association of Certified Public Accountants (IACPA)

The Iranian Association of Certified Public Accountants was created by law in 1994 and became operational in 2001. IACPA members, in addition to audits of financial statements, perform management consultancy, accountancy work, insolvency and liquidation management, internal audits, and management (performance) audits. IACPA has about 1,800 CPA members employed in the public practice, business, and public sectors. In September 2009, IACPA finalized its IFAC Compliance Program Part 3, Action Plan, which is published on the IFAC website.

2. Latvia - Latvian Association of Certified Auditors (LACA)

The Latvian Association of Certified Auditors was created pursuant to the Law on Certified Auditors of January 1, 1977. LACA is officially recognized as the only professional organization in Latvia authorized to unite all certified auditors and commercial companies of certified auditors. Presently, LACA is comprised of 160 certified auditors and 140 audit firms and this number is adequate for the size of the audit market in Latvia. According to the Audit Law, only members of LACA are authorized to perform statutory audits. Additional information about LACA's planned activities are described in its Action Plan.

3. Kosovo - Society of Certified Accountants and Auditors of Kosovo (SCAAK)

The Society of Certified Accountants and Auditors of Kosovo was created under the framework established by the Law on Financial Reporting of 2001. SCAAK is the only professional accounting and auditing body in Kosovo and has a clear objective of supporting adoption of international standards. SCAAK membership includes 124 certified auditors, 548 certified accountants, and 1,318 accounting technicians. Additional information about SCAAK's planned activities are described in its Action Plan.

New Associates

4. Brunei Darussalam - Brunei Darussalam Institute of Certified Public Accountants (BICPA)

The Brunei Darussalam Institute of Certified Public Accountants was registered with the Registrar of Societies of Brunei Darussalam on June 7, 1987. It was formed to allow the accountants in Brunei Darussalam to develop and promote the profession in the country. BICPA plays a role in advising the Ministry of Finance of Brunei in standard-setting activities and supporting implementation of standards. Members of BICPA are recognized by the Ministry of Finance as public accountants (Authorized Auditors). BICPA membership, currently 70 members, reflects the small population of the country. As an IFAC associate, BICPA will work on developing its IFAC Compliance Program Part 3, Action Plan.

5. Luxembourg - Ordre des Experts-Comptables du Luxembourg (OEC)

The Ordre des Experts-Comptables du Luxembourg joins IFAC as the second organization representing Luxembourg. OEC is the professional accountancy organization representing the profession of experts-comptables in the country. It was originally established as the Ordre des Experts-Comptables Luxembourgeois (OECL) in 1950. Following the changes in the country's legal framework, it was transformed into OEC in 1999. OEC has close to 1,000 members that provide a wide range of services, including preparation of financial statements and contractual audits. As an IFAC associate, OEC will work on developing its IFAC Compliance Program Part 3, Action Plan.

4) International Standards Adoption - ISA Update

Professional accountancy organizations play an important role in the adoption and implementation of international standards within effective regulatory frameworks. This includes the adoption and of International Standards on Auditing (ISAs) as developed by the International Auditing and Assurance Standards Board (IAASB). To help the public, member bodies, and other stakeholders better understand the ongoing nature of the adoption process, IFAC has released an interactive chart that captures the status of ISA adoption process in different jurisdictions around the world Basis of ISA Adoption chart.

The chart, at the time of publication of this eNews, shows that a total of 126 jurisdictions worldwide have adopted ISAs to at least some degree. The basis of ISA adoption used in preparing the chart is categorized as follows:  

Adoption of ISAs, including the clarified ISAs, and changes to strengthen local regulatory and standard-setting frameworks is an ongoing process. Consequently, the chart and related notes will be updated as national standard-setters and IFAC members provide information about their country's progress. Compliance staff encourages information to be submitted to Technical Manager Szymon Radziszewicz.   

5) Share MBD eNews with Your Colleagues

Going forward, the MBD staff will issue regular eNews updates to keep you current on recent developments. Please forward this eNews to any interested colleagues and advise them that they can subscribe to receive the next issue of MBD eNews.

For more information about any of the items mentioned above or other information about the Member Body Compliance Program, the Compliance Advisory Panel, or the Developing Nations Committee and IFAC, please contact communications@ifac.org.

Register and Login to subscribe to the Member Body Development and Professional Accountantcy Organization Development Committee eNews.

In This Issue:

1. IPSASB Accelerates Conceptual Framework Initiative
2. Work Started on Reviewing IPSASB's Governance Structures
3. IPSASB Issues Service Concession ED
4. Communications Report Released at April IPSASB Meeting
5. Share IPSASB eNews with your Colleagues

1. IPSASB Accelerates Conceptual Framework Initiative

The International Public Sector Accounting Standards Board (IPSASB) is accelerating its efforts in the development of the Conceptual Framework for General Purpose Financial Reporting by Public Sector Entities (the Framework), with the goal of completing it as quickly as reasonably possible.

The Framework initiative is the IPSASB's most important project over the next three years and is therefore being prioritized in all planning and resource allocations. It will explicitly identify and explain the concepts, definitions and principles underpinning IPSASs and related guidance. John Stanford, IPSASB's Deputy Director, has taken on the role of Project Coordinator in order to ensure that all components can be completed expeditiously and are well integrated.

This project, launched in 2006, involves four phases, which are progressing as follows:
1. Reviewing the responses (now over 50) from stakeholders to the Consultation Paper Conceptual Framework for General Purpose Financial Reporting by Public Sector Entities: The Objectives of Financial Reporting; The Scope of Financial Reporting; The Qualitative Characteristics of Information Included in General Purpose Financial Reports; The Reporting Entity.
2. Discussing issues related to the definition and recognition of elements
3. Discussing issues related to measurement
4. Discussing issues related to presentation and disclosure

The IPSASB is well under way in phases 2 and 3, for which Consultation Papers are expected to be released in 2010. The Consultation Paper for phase 4 is expected in early 2011.

The first Consultation Paper, published in September 2008, can be accessed at IFAC's Exposure Drafts and Consultation Papers webpage. 
2. Work Started on Reviewing the IPSASB's Governance Structures

The IPSASB has launched discussions regarding developing a new plan for its strategy and operations, including proposed fundamental changes to some of its governance structures. These discussions are in the early stages and have been informed by various comments and concerns that have been raised by constituents at IPSASB meetings and various other meetings.

One of the most important aspects of these discussions is the need to develop a process for public oversight of the board's work. Unlike the other IFAC standard-setting boards, the IPSASB is currently not subject to oversight by the Public Interest Oversight Board (PIOB). The public sector clearly has a strong public interest mandate, and the need for oversight for the IPSASB has been anticipated by IFAC's reform process.

IFAC and the IPSASB will continue to discuss this and other related issues and together are developing a plan for consulting with various governments and other stakeholders on proposed changes and the related impacts.

3. IPSASB Issues Service Concession ED

The IPSASB is seeking comments on an exposure draft (ED) that addresses accounting for service concession arrangements (SCAs) by the grantor. Titled Service Concession Arrangements: Grantor, the ED presents requirements and guidance on how grantors recognize, account for, and disclose assets in service concession arrangements.

Service concession arrangements, often called Public-Private Partnerships, or PPPs, involve an operator providing services to the public on behalf of a grantor - usually the government or another public sector entity. There has been a demand for more accounting guidance for the grantor and the IPSASB's ability to develop draft guidance is strongly supported by constituents.

Comments on the exposure draft are requested by June 30, 2010. To access the exposure draft or submit a comment, visit the IFAC Exposure Drafts and Consultation Papers webpage. 

4. Communications Report Released at April IPSASB Meeting

The IPSASB prepared a Communications Report outlining the full extent of the communications and liaison activities undertaken by IPSASB Members, Technical Advisors (TAs) and staff during 2009.

In summary, the report revealed the following details:

• Over the course of 2009, an impressive array and volume of communications and liaison activities were undertaken on behalf of the IPSASB. Over 82% of Members (14/17), as well as many TAs and IPSASB staff, undertook these activities;
• Over 150 activities took place in 2009, including meetings, presentations, publications and teleconferences;
• These communication activities reached all geographical regions around the world; and
• Approximately 30 countries and over 50 cities worldwide were visited.

5. Share IPSASB eNews with Your Colleagues

The IPSASB issues regular eNews updates to keep you current on its activities and recent publications. Please forward this eNews to any interested colleagues and let them know that they can subscribe to this and other eNews bulletins at the eNews sign-up page at www.ifac.org/e-news.

ACCOUNTANTS: SUSTAINING VALUE CREATION

The 18th World Congress of Accountants, hosted by the Malaysian Institute of Accountants and IFAC, is November 8-11, 2010.  The Congress will offer more than thirty panel discussions and speakers from The World Bank, Transparency International, the Financial Stability Board, the European Commission, IFIAR, and the IASB, among others. Thousands of delegates representing the profession from around the world will attend.

Register now!



For more information about any of the items mentioned above or other information about the IPSASB, please contact: communications@ifac.org or visit the IPSASB's home page at www.ipsasb.org.

About the IPSASB and IFAC

The IPSASB (www.ipsasb.org) develops high quality accounting standards and guidance for use by public sector entities around the world. The IPSASB, an independent standard-setter operating under the auspices of IFAC, promotes adoption of and convergence to its standards globally.

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 159 members and associates in 124 countries, representing more than 2.5 million accountants in public practice, education, government service, industry and commerce. In addition to setting international accounting standards through the IPSASB, IFAC, through its independent standard-setting boards, sets international auditing and assurance, ethics, and education standards. It also issues guidance to encourage high quality performance by professional accountants in business.

In This Issue:

1. IESBA Seeks Comment on Proposed Strategy and Work Plan for 2010-2012
2. Adoption and Implementation Material Available
3. IESBA Convergence Objective
4. 2010 Ethics Handbook Available in Print and Electronic Formats
5. Upcoming Meetings
6. Share Ethics eNews with Your Colleagues

1. IESBA Seeks Comment on Proposed Strategy and Work Plan for 2010-2012

The IESBA has released an exposure draft of its proposed Strategy and Work Plan 2010-2012. This plan focuses on proposed new projects and activities that the board will undertake over the next three years.

In the draft 2010-2012 plan, the IESBA states that it intends to continue work and complete two projects that had been a high priority in the previous work plan:

• Conflicts of Interest - The IESBA will reconsider the nature and extent of the guidance in the Code of Ethics for Professional Accountants (the Code) on conflicts of interest and revise Sections 220 Conflicts of Interest and 310 Potential Conflicts as appropriate; and
• Responding to Fraud or Illegal Acts - The IESBA will reconsider the nature and extent of the guidance currently in the Code on how professional accountants should respond in situations where they encounter a suspected fraud or illegal act. The board will then revise the Code as appropriate.

The IESBA also intends to commence a project that will consider which entities should be considered to be a "related entity" of a collective investment vehicle, including mutual funds, and whether the existing definition of related entity should be revised when applied to collective investment vehicles.

In addition to its standard-setting activities, the IESBA plans to continue to assess its activities supporting those professionals, organizations and other stakeholders who are working to adopt and implement the revised Code. The board will consider whether additional support materials and activities would be useful.

The plan also outlines intended activities related to the IESBA's convergence objective.

Comments are due on June 15, 2010. To access the exposure draft, visit: http://www.ifac.org/Guidance/EXD-Details.php?EDID=0137.

2. Adoption and Implementation Material Available

The IESBA staff has prepared materials to support the adoption and implementation of the Code of Ethics for Professional Accountants (the Code).

These materials include:

• PowerPoint presentations that can be used to explain the content of the Code;
• Comparisons of the revised Code with the previous Code;
• A template that can assist individuals in understanding how the provisions in a particular jurisdiction compare to the Code, and
• An overview of the independence requirements in the Code.

The IESBA will continue to assess what additional material or activities would be useful to further the adoption and implementation of the Code.

The adoption and implementation support materials are available at http://www.ifac.org/Ethics/Resources.php#implementation-and-adoption.

3. IESBA Convergence Objective

Promoting international convergence of independence requirements for accountancy professionals is a major priority for the IESBA. To that end, the IESBA will liaise closely with national standard setters and regulators to identify and understand their perspectives on convergence, and to obtain their views on how the Code can be used as a catalyst to achieve greater convergence. In particular, the IESBA will be seeking input on:

(a) Whether in a group audit situation, where the national independence standards in the jurisdiction of the parent auditor contain requirements that are more stringent than those contained in the Code, the parent auditor would accept foreign auditors of foreign subsidiaries complying with the independence requirements in the Code; and
(b) The types of improvements to the Code that standard setters and regulators believe should be made in order for the Code to gain acceptance and recognition in their jurisdictions. The IESBA will consider input it has received from stakeholders, such as the need to identify more clearly the independence provisions related to public interest entities. Accordingly, it will prepare a document identifying those provisions, which it will use in discussions with national standard setters and regulators.

4. 2010 Ethics Handbook Available in Print and Electronic Formats

The 2010 edition of the Handbook of the Code of Ethics for Professional Accountants is now available for download free-of-charge from IFAC's Publications and Resources site (web.ifac.org/publications). Print copies of the handbook, together with the Handbook of International Quality Control, Auditing, Review, Other Assurance, and Related Services Pronouncements, can be ordered for US $185.00 plus shipping by calling IFAC at +1 (212) 471-8722.

5. Upcoming Meetings

The IESBA next meets on June 23-24, 2010 in Paris, France. For more information and to register to attend an IESBA meeting as a public observer, visit: http://www.ifac.org/Ethics/Meetings.php.

Meetings of the IESBA Consultative Advisory Group are also open to public observers. Its next meeting will be held on September 13, 2010 in London, United Kingdom. For more information, visit: http://www.ifac.org/Ethics/ConsultativeAdvisoryGroup.php.

6. Share Ethics eNews with Your Colleagues

The IESBA issues regular eNews updates to keep you current on its activities and recent publications. Please forward this eNews to any interested colleagues and advise them that they can subscribe to receive IESBA eNews by following these simple steps:

1. Go to the eNews sign-up page at http://www.ifac.org/E-news/index.tmpl.
2. Enter your email address, first name, last name and country.
3. Select "Ethics eNews" from the check list, as well as any other electronic newsletters that you would like to receive.

You will receive the next issue of the IESBA eNews directly to your inbox.



For more information about any of the items mentioned above or other information about the IESBA, please contact: communications@ifac.org.

About the IESBA and IFAC

The IESBA develops ethical standards and guidance for use by all professional accountants under a shared standard-setting process involving the Public Interest Oversight Board, which oversees the activities of the IESBA, and the IESBA Consultative Advisory Group, which provides public interest input into the development of the Code.

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 159 members and associates in 124 countries, representing more than 2.5 million accountants in public practice, education, government service, industry and commerce. Through its independent standard-setting boards, IFAC sets ethics, auditing and assurance, education, and public sector accounting standards. It also issues guidance to encourage high quality performance by professional accountants in business.

In This Issue:

1. IAASB Meetings
2. Open for Comment - Questionnaire on the IAASB's 2012-2014 Strategy and Work Program
3. Open for Comment - Exposure Draft of ISAE 3420, Assurance Reports on the Process to Compile Pro Forma Financial Information Included in a Prospectus
4. Of Interest to Small and Medium Practitioners (SMPs) - IAASB Progresses Revisions of Review and Compilation Standards
5. Recently Issued Publications
6. Share IAASB eNews with Your Colleagues

1. IAASB Meetings

The most recent IAASB meeting was held on March 15-19, 2010 in New York.

In addition to the projects discussed in this eNews, the IAASB deliberated issues relating to the following projects:

• Revision of International Standard on Auditing (ISA) 610, Using the Work of Internal Auditors
• Revision of ISA 720, The Auditor's Responsibilities Relating to Other Information in Documents Containing Audited Financial Statements
• Revision of International Standard on Assurance Engagements (ISAE) 3000, Assurance Engagements Other than Audits or Reviews of Historical Financial Information
• Revision of International Auditing Practice Statement (IAPS) 1012, Auditing Complex Financial Instruments
• Development of ISAE 3410, Assurance on a Greenhouse Gas Statement

The IAASB will meet via teleconference on May 11, 2010 and in Mainz, Germany on June 14-18, 2010. As a reminder, all meeting agenda materials are publicly available posted on the IAASB's website in advance of the meetings and audit recordings are posted after the meetings. 

2. Open for Comment - Questionnaire on the IAASB's 2012-2014 Strategy and Work Program

The IAASB has launched an online questionaire to inform the development of its strategic direction and related work program for 2012-2014.

The questionnaire serves as the first stage of the IAASB's 18-month consultation process. Through the survey, the board seeks feedback on the challenges facing the accountancy profession; the IAASB's current strategic focus on the development, adoption, and implementation of standards; the needs of small-and medium-sized practices (SMPs) and small-and medium-sized entities (SMEs); and current and future projects, among other topics.

The results of the questionnaire will be used to develop a formal Consultation Paper on the IAASB's future strategy and work program, to be issued in December 2010.

Responses to the online questionnaire are requested by May 14, 2010.

3. Open for Comment - Exposure Draft of ISAE 3420, Assurance Reports on the Process to Compile Pro Forma Financial Information Included in a Prospectus

At its March 2010 meeting, the IAASB approved for exposure proposed ISAE 3420, Assurance Reports on the Process to Compile Pro Forma Financial Information Included in a Prospectus. The proposed standard deals with the practitioner's responsibilities to report on the process of compiling pro forma financial information for inclusion in an issuer's prospectus.

The proposed standard responds to calls from stakeholders for common standards of reporting in relation to issuers' financial information included in prospectuses. This is particularly relevant in light of the growing number of cross-border securities offerings and the globalization of capital markets. The proposed new standard is aimed at promoting the development and convergence of market practice around the world by establishing clear, globally accepted benchmarks for the performance of such engagements.

Comments should be submitted using the online comment system by September 30, 2010.

4. Of Interest to Small and Medium Practitioners (SMPs) - IAASB Progresses Revisions of Review and Compilation Standards

The IAASB continues to make progress in developing international engagement standards for financial statement services other than audits.

Placing high priority on further addressing the needs of SMEs, as a first step the IAASB has focused its efforts on revising two existing standards:

• International Standard on Related Services (ISRS) 4410, Engagements to Compile Financial Statements; and
• International Standard on Review Engagements (ISRE) 2400, Engagements to Review Financial Statements.

This strategic focus recognizes that the IAASB plays a leading role in exploring standards for a range of services other than the financial statement audit that may be appropriate for SMEs. While such entities may seek to have audits on a voluntary basis, and the users of their financial statements (such as lending institutions) may request that audits be performed, the implication is clear-there is a market demand for services that meet the unique needs of SMEs and the users of their financial information.

The IAASB discussed the project at its March meeting and will further deliberate the issues at its June and September 2010 meetings. While significant deliberations still remain over the next several months, the IAASB is on schedule to issue proposed standards for public comment by the last quarter of 2010.

A Staff Update, which provides more details on the project, can be accessed at www.ifac.org/IAASB/ProjectHistory.php?ProjID=0096.

5. Recently Issued Publications

The IAASB has released its 2009 annual report, which highlights the completion of the landmark Clarity Project to redraft the ISAs, the development of adoption and implementation resources for the ISAs, and the launch of innovative new projects to address emerging issues.

Public input is essential to ensuring that the IAASB has insights on the different perspectives of international regulators and organizations, national auditing standard setters, practitioners, academia, and other stakeholders. The report outlines all of the outreach activities that the IAASB participated in during 2009. These activities demonstrate the board's commitment to actively engaging with its stakeholders.

IFAC has also recently released the 2010 Handbook of International Quality Control, Auditing, Review, Other Assurance, and Related Services Pronouncements and the 2010 Handbook of the Code of Ethics for Professional Accountants.

The handbooks can be downloaded free of charge in PDF format or purchased in print from IFAC's Publications and Resources site: web.ifac.org/publications.

6. Share IAASB eNews with Your Colleagues

The IAASB issues regular eNews updates to keep you current on its activities and recent publications. Please forward this eNews to any interested colleagues and let them know that they can subscribe to this and other eNews bulletins on the IAASB website.


For more information about any of the items mentioned above or other information about IFAC, please contact communications@ifac.org.

About the IAASB
The IAASB (www.iaasb.org) develops auditing and assurance standards and guidance for use by all professional accountants under a shared standard-setting process involving the Public Interest Oversight Board, which oversees the activities of the IAASB, and the IAASB Consultative Advisory Group, which provides public interest input into the development of the standards and guidance. The structures and processes that support the operations of the IAASB are facilitated by IFAC.

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 159 members and associates in 124 countries and jurisdictions, representing more than 2.5 million accountants in public practice, education, government service, industry, and commerce. Through its standard-setting boards, IFAC sets international ethics, auditing and assurance, education, and public sector accounting standards. It also issues guidance to encourage high-quality performance by professional accountants in business.

In This Issue:

1. IAASB Meetings
2. Arnold Schilder Reappointed To Chair IAASB From 2012-2014
3. Open for Comment - Exposure Draft of ISA 610, Using the Work of Internal Auditors, and ISA 315, Identifying and Assessing the Risks of Material Misstatement through Understanding the Entity and Its Environment, and Proposed Impact Analysis Approach
4. Open for Comment - Exposure Draft of ISAE 3420, Assurance Reports on the Process to Compile Pro Forma Financial Information Included in a Prospectus
5. Existing and Forthcoming ISA Modules
6. Share IAASB eNews with Your Colleagues
7. Register for the 18th World Congress of Accountants in Kuala Lumpur, Malaysia on November 8-11, 2010

1. IAASB Meetings

The most recent IAASB meetings were held on June 14-18, 2010 in Mainz, Germany and on July 29, 2010 via teleconference.

In addition to the projects discussed in this eNews, the IAASB deliberated issues relating to the following projects:

• Revision of International Standard on Assurance Engagements (ISAE) 3000, Assurance Engagements Other than Audits or Reviews of Historical Financial Information
• Development of ISAE 3410, Assurance on a Greenhouse Gas Statement
• Authority of International Auditing Practice Statements (IAPSs), and development of revised IAPS 1012, Auditing Complex Financial Instruments
• Revision of International Standard on Review Engagements (ISRE) 2400, Engagements to Review Financial Statements
• Revision of International Standard on Related Services (ISRS) 4410, Engagements to Compile Financial Instruments

The IAASB will meet in Malta on September 20-24, 2010. As a reminder, all meeting agenda materials are publicly available and posted on the IAASB's website in advance of IAASB meetings. In addition, audio recordings are posted after the meetings.

2. Arnold Schilder Reappointed To Chair IAASB From 2012-2014

The IFAC Board has reappointed Prof. Arnold Schilder to lead the IAASB for the period 2012-2014.

Prof. Schilder's appointment to a second three-year term as IAASB Chairman begins on January 1, 2012. The appointment was approved by the Public Interest Oversight Board-an independent body that oversees IAASB activities-at its latest meeting in Madrid, Spain on June 28-29, 2010.

3. Open for Comment - Exposure Draft of ISA 610, Using the Work of Internal Auditors, and ISA 315, Identifying and Assessing the Risks of Material Misstatement through Understanding the Entity and Its Environment, and Proposed Impact Analysis Approach

The IAASB has issued an Exposure Draft (ED) for the proposed revision of ISA 610, Using the Work of Internal Auditors. The standard is being revised in recognition of developments in the internal auditing environment as well as the evolving relationship between internal and external auditors.

The proposed revision addresses the responsibilities of the external auditor as they relate to using the work of an entity's internal auditor during an audit. In particular, the new standard aims to enhance the performance of external auditors by providing them a stronger framework for evaluating, as well as using, the work and assistance of internal auditors. Related enhancements concerning the external auditor's required considerations of the internal audit function have been proposed in ISA 315, Identifying and Assessing the Risks of Material Misstatement through Understanding the Entity and Its Environment, which is also part of the ED.

In addition to setting out the IAASB's main proposals for the revised standards, the ED's explanatory memorandum outlines a pilot approach for analyzing the benefits and impacts of these proposals. This approach provides a structured and transparent means for communicating the effects of proposals to stakeholders. The pilot will help inform the IAASB as well as lead to the further integration of the analysis of benefits and impacts into the standard-setting process. The IAASB's pilot is the first step in the development of an impact analysis process for use throughout IFAC. Other independent standard-setting boards plan to test this process in future projects.

The IAASB invites all stakeholders to comment on its proposals. To access the exposure draft or submit a comment, visit the IAASB's website. Comments for this ED are requested by November 15, 2010.

4. Open for Comment - Exposure Draft of ISAE 3420, Assurance Reports on the Process to Compile Pro Forma Financial Information Included in a Prospectus

In April 2010, the IAASB released its Exposure Draft (ED) of proposed ISAE 3420, Assurance Reports on the Process to Compile Pro Forma Financial Information Included in a Prospectus. The proposed standard deals with the practitioner's responsibilities when reporting on whether the process of compiling pro forma financial information for inclusion in an issuer's prospectus has been properly followed.

The proposed standard is particularly relevant in light of the growing number of cross-border securities offerings and the globalization of capital markets. It provides comprehensive guidance on engagement acceptance considerations and on the nature and extent of the practitioner's work. It also provides an illustrative report arising from such an engagement.

The IAASB invites all stakeholders to comment on its proposals. To access the exposure draft or submit a comment, visit the IAASB's website. Comments should be submitted using the online comment system by September 30, 2010.

5. Existing and Forthcoming ISA Modules

IAASB staff has developed a series of ISA Modules focusing on some of the new and more significantly revised ISAs.

Each module consists of a short video and slides that explain the key principles of, and major changes in, individual ISAs. This non-authoritative material is designed to be of assistance to auditors in the field, trainers, and those responsible for promoting adoption and implementation of the clarified ISAs. ISA modules may be downloaded free of charge from the IAASB Clarity Center. The IAASB encourages IFAC members, associates, regional accountancy bodies, and firms to use these materials and to promote their availability to their members and employees.

IAASB staff is currently developing three new modules, planned for release in October 2010. The new modules are:

• Materiality, Misstatements and Reporting
• Using the Work of an Auditor's Expert
• Written Representations

6.    Share IAASB eNews with Your Colleagues

The IAASB issues regular eNews updates to keep you appraised of the board's activities and recent publications. Please forward this eNews to any interested colleagues and let them know they can subscribe to this and other eNews bulletins.

7.    Register for the 18th World Congress of Accountants in Kuala Lumpur, Malaysia on November 8-11, 2010

The 18th World Congress of Accountants, hosted by the Malaysian Institute of Accountants and IFAC, is November 8-11, 2010. The theme of the congress will be "Accountants: sustaining value creation". The Congress will offer more than thirty panel discussions and speakers from The World Bank, Transparency International, the Financial Stability Board, the European Commission, IFIAR, and the IASB, among others. Thousands of delegates representing the profession from around the world will attend.

For more information about any of the items mentioned above or other information about IFAC, please contact communications@ifac.org.

About the IAASB
The IAASB (www.iaasb.org) develops auditing and assurance standards and guidance for use by all professional accountants under a shared standard-setting process involving the Public Interest Oversight Board, which oversees the activities of the IAASB, and the IAASB Consultative Advisory Group, which provides public interest input into the development of the standards and guidance. The structures and processes that support the operations of the IAASB are facilitated by IFAC.

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 159 members and associates in 124 countries and jurisdictions, representing more than 2.5 million accountants in public practice, education, government service, industry, and commerce. Through its standard-setting boards, IFAC sets international ethics, auditing and assurance, education, and public sector accounting standards. It also issues guidance to encourage high-quality performance by professional accountants in business.

In This Issue:

1. IAASB Meetings
2. IAASB Reports on Clarity ISA Implementation Monitoring
3. New Implementation Resources to Support Implementation of the Clarified ISAs
4. Of Special Interest to Small and Medium Practices (SMPs) - Exposure Draft of International Standard on Related Services (ISRS) 4410, Compilation Engagements
5. Open for Comment - Exposure Draft of International Auditing Practice Statement (IAPS) 1000, Special Considerations in Auditing Complex Financial Instruments
6. Open for Comment - Exposure Draft of ISA 610, Using the Work of Internal Auditors, and ISA 315, Identifying and Assessing the Risks of Material Misstatement through Understanding the Entity and Its Environment, and Proposed Impact Analysis Approach
7. Linda de Beer appointed IAASB Consultative Advisory Group (CAG) Chair
8. European Commission (EC) Issues Green Paper on Auditing
9. Other Relevant IFAC Initiatives
10. Share IAASB eNews with Your Colleagues

1. IAASB Meetings

The most recent IAASB meeting was held on September 20-24, 2010 in St. Julian's, Malta.

In addition to the projects discussed in this eNews, the IAASB deliberated issues relating to the following projects:

• Revision of International Standard on Assurance Engagements (ISAE) 3000, Assurance Engagements Other than Audits or Reviews of Historical Financial Statements
• Development of ISAE 3410, Assurance on a Greenhouse Gas Statement
• Revision of International Standard on Review Engagements (ISRE) 2400, Engagements to Review Financial Statements
• Revision of International Standard on Auditing (ISA) 720, The Auditor's Responsibilities Relating to Other Information in Documents Containing Audited Financial Statements
• Issues relating to the audit of financial statement disclosures

The IAASB will meet in Orlando, Florida, on December 6-10, 2010. As a reminder, all meeting agenda materials are publicly available and posted on the IAASB's website in advance of IAASB meetings. In addition, audio recordings are posted after the meetings. Visit http://www.iaasb.org/meetings

2. IAASB Reports on Clarity ISA Implementation Monitoring

The IAASB has released a progress report on its project to monitor the implementation of its clarified ISAs. The report, Implementation of the Clarified International Standards on Auditing (ISAs), highlights key findings from the first phase of the IAASB's initiative to develop a process for gathering information to help it evaluate the effective and consistent implementation of the clarified ISAs. Following completion of the Clarity Project, the first phase of this IAASB initiative has focused on learning more about early implementation experiences.

3. New Implementation Resources to Support Implementation of the Clarified ISAs

To further facilitate effective implementation of the clarified ISAs, new resources have been developed to assist auditors as they prepare for the upcoming audit season. These include:

• New ISA Modules. In promoting awareness and understanding of the newly clarified ISAs, the IAASB has released a second series of "ISA Modules" covering ISAs that address materiality in planning and performing an audit of financial statements, the evaluation of identified misstatements, written representations, using the work of an auditor's expert, and auditor reporting. Developed by IAASB staff, each of these modules combines short video presentations and accompanying slides that explain the key principles of, and major changes in, individual ISAs, including the implications for audits of SMEs. The new modules, as well as those developed in 2009, are available to download free of charge from the IAASB Clarity Center on IAASB's website. The IAASB encourages IFAC members, associates, regional accountancy bodies, and firms to use these materials and to promote their availability to their members and employees.
• Staff Q&A on Unusual Transactions. As further support for ISA implementation, IAASB staff has released Auditor Considerations Regarding Significant Unusual or Highly Complex Transactions, a Staff Questions and Answers (Q&A) publication. The Q&A highlights considerations in the ISAs that are relevant to auditing such transactions, often an area that gives rise to risks of material misstatement of the financial statements.

4. Of Special Interest to SMPs - Exposure Draft of International Standard on Related Services (ISRS) 4410, Compilation Engagements

In October, the IAASB released for public exposure proposed ISRS 4410, Compilation Engagements. The proposed standard is the first step in the IAASB'S work to create robust standards for services that can be used by entities that are either not required or do not elect to be audited to meet their business reporting needs. Through a compilation engagement, practitioners can provide significant benefit by applying their expertise in accounting and financial reporting. This expertise is applied to assist the management of an entity in preparing and presenting historical financial information for use by the entity's internal or external stakeholders.

Comments on the exposure draft are requested by March 31, 2011.

5. Open for Comment - Exposure Draft of International Auditing Practice Statement (IAPS) 1000, Special Considerations in Auditing Complex Financial Instruments

In October, the IAASB released for public exposure a new proposed pronouncement-IAPS 1000, Special Considerations in Auditing Complex Financial Instruments that highlights practical considerations for auditors when dealing with complex financial instruments. The pronouncement gives particular emphasis to auditing considerations relating to valuation and disclosure issues for financial statement items measured at fair value.

Along with the proposed IAPS 1000, the IAASB is also exposing for comment proposed changes to the current Preface to the International Standards on Quality Control, Auditing, Review, Other Assurance and Related Services, which explains the authority of this and future IAPSs, as well as proposals to withdraw the six existing IAPS. The IAASB plans to finalize proposed IAPS 1000 and the statement of authority in 2011. Auditors, however, may wish to consider the material in the proposed IAPS 1000 as they plan and perform their upcoming audit engagements.

Comments on the exposure draft are requested by February 11, 2011.

6. Open for Comment - Exposure Draft of ISA 610, Using the Work of Internal Auditors, and ISA 315, Identifying and Assessing the Risks of Material Misstatement through Understanding the Entity and Its Environment, and Proposed Impact Analysis Approach

Recognizing developments in the internal auditing environment and the evolving relationship between internal and external auditors, in July, the IAASB released an exposure draft on a proposed revised standard that addresses the external auditor's responsibilities relating to using internal auditors' work during an audit.

The proposed ISA 610 (Revised), Using the Work of Internal Auditors, aims to enhance the external auditor's performance by providing a stronger framework for evaluating and using the work and assistance of an entity's internal auditors. Related enhancements to the external auditor's required considerations of the internal audit function are also proposed in ISA 315 (Revised), Identifying and Assessing the Risks of Material Misstatement through Understanding the Entity and Its Environment. 

Comments on the exposure draft are requested by November 15, 2010.

7. Linda de Beer Appointed IAASB Consultative Advisory Group (CAG) Chair

Prof. Linda de Beer has been appointed chair of the CAG to the IAASB. The IAASB CAG is an independent body and provides the forum in which the representatives of its various member organizations-including regulators, preparers, and others with an interest in international auditing and assurance-provide advice on technical and public interest matters relating to the drafts of IAASB standards and strategy.

As a representative of the Johannesburg Stock Exchange, Prof. de Beer previously represented the World Federation of Exchanges on the CAG. She was elected by the CAG membership to succeed the current CAG chairman, David Damant, who since June 2004 has served as the first independent IAASB CAG chairman. Prof. de Beer's appointment-a three-year term effective October 1, 2010-has been approved by the Public Interest Oversight Board (PIOB).

8. European Commission (EC) Issues Green Paper on Auditing

The EC has issued a Green Paer on auditing that focuses on a number of issues, including the role of auditors, public oversight, concentration in the audit market, SME audits, international collaboration, and auditor independence. The deadline for comment submissions is December 8, 2010. The EU Commission has scheduled a hearing in early February 2011, to present and discuss the results of the consultation procedure. It is expected that proposals in certain areas may be made as early as 2011.  

9. Other Relevant IFAC Initiatives

IFAC's SMP Committee has recently released implementation support materials to help practitioners understand and efficiently apply the clarified ISAs. The two volume second edition of the Guide to Using International Standards on Auditing in the Audits of Small- and Medium-Sized Entities includes various improvements based on feedback from users of the first edition, including two integrated case studies, one of which focuses on an audit of a micro-entity and increased focus on SME audits. A second edition of the Guide to Quality Control for Small- and Medium-Sized Practices was issued in July. The implementation guide is intended to help SMPs understand and efficiently apply the redrafted International Standard on Quality Control (ISQC) 1, Quality Control for Firms that Perform Audits and Reviews of Financial Statements, and Other Assurance and Related Services Engagements. 

Initiatives of other IFAC Boards and Committees may also be of interest to those who follow the work of the IAASB, including the following:

• Forum of Firms Issues Paper on Client Acceptance and Continuance
• IFAC and United Nations Conference on Trade and Development (UNCTAD) Host Accountancy Summit on Corporate Governance Reform
• Forum of Firms Focuses on Practical Application of Group Audit Standard
• The Prince's Accounting for Sustainability Project (A4S) and the Global Reporting Initiative (GRI) Announce Formation of the International Integrated Reporting Committee

10. Share IAASB eNews with Your Colleagues

The IAASB issues regular eNews updates to keep you appraised of the board's activities and recent publications. Please forward this eNews to any interested colleagues and let them know they can subscribe to this and other eNews bulletins at the eNews sign-up page.

The IAASB invites all stakeholders to comment on its proposals. To access the exposure drafts discussed in this eNews or submit a comment, visit the IAASB's website. For more information about any of the items mentioned above or other information about IFAC, please contact communications@ifac.org.


About the IAASB
The IAASB (www.iaasb.org) develops auditing and assurance standards and guidance for use by all professional accountants under a shared standard-setting process involving the PIOB, which oversees the activities of the IAASB, and the IAASB CAG, which provides public interest input into the development of the standards and guidance. The structures and processes that support the operations of the IAASB are facilitated by IFAC.

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 159 members and associates in 124 countries and jurisdictions, representing approximately 2.5 million accountants in public practice, education, government service, industry, and commerce. Through its standard-setting boards, IFAC sets international ethics, auditing and assurance, education, and public sector accounting standards. It also issues guidance to encourage high-quality performance by professional accountants in business.

Below you will find an update of recent and upcoming IFAC Translations & Permissions news. One of IFAC's primary objectives is to develop high-quality standards and guidance that enable accountants worldwide to provide services of consistently high-quality in the public interest. To achieve this objective, IFAC strives to make its publications widely available by enabling individuals to freely download them from itswebsite and permitting interested parties to reproduce and translate them.

In this Issue

1. 2010 Translations Achievements--Official UN Languages
2. Other Translations Activities
3. What to Watch for in 2011
4. Russian Translations Meeting
5. Trados Translation Memory Software
6. Request for Translation Proposals
7. Important Points Regarding IFAC Translations; Q&As and other Resources
8. IFAC Job Posting: Associate, Translations and Permissions

1. 2010 Translations Achievements--Official UN Languages

We continue to encourage a single, high-quality translation per language. The following are highlights in regard to translation of standards and other documents published by IFAC into the official languages of the United Nations (UN). More information can be found in the IFAC Translations Database at www.ifac.org/about-ifac/translations-permissions/translations-database.

• Arabic--An Arabic translation of the Handbook of International Quality Control, Auditing, Review, Other Assurance, and Related Services Pronouncements - 2010 Edition and the Handbook of the Code of Ethics for Professional Accountants - 2010 Edition were published by the Arab Society of Certified Accountants (Jordan).
  
  The Arabic language translation of the IFAC Professional Accountants in Business Committee publication,Defining and Developing an Effective Code of Conduct for Organizations (June 2007), was completed by the Saudi Organization for Certified Public Accountants.
• Chinese--The Chinese translation of the Handbook of International Quality Control, Auditing, Review, Other Assurance, and Related Services Pronouncements - 2010 Edition and the Handbook of the Code of Ethics for Professional Accountants - 2010 Edition is being performed by the Chinese Institute of Certified Public Accountants (CICPA). 
  
  In addition, a translation of the Handbook of International Public Sector Accounting Pronouncements - 2010 Edition is in progress by the China Financial and Economic Publishing House, on behalf of the Ministry of Finance of the People's Republic of China.
  
  Information about Chinese translations of the IFAC Professional Accountancy Organization Development Committee (formerly the Developing Nations Committee) publication, Good Practice Guide: The Education, Training, and Development of Accounting Technicians (2009), and the IFAC Professional Accountants in Business Committee publication, Financial Reporting Supply Chain-Current Perspectives and Directions(2008), performed by CICPA has been posted on the IFAC Translations Database. 
• French--Several IFAC member bodies collaborated to produce a single, high-quality French translation of the Code of Ethics for Professional Accountants (July 2009) of the International Ethics Standards Board for Accountants (IESBA). See more about this achievement in the most recent version of IFAC News.
  
  CGA-Canada has published a French translation of the IFAC Small and Medium Practices (SMP) Committee publication Guide to Quality Control for Small- and Medium-Sized Practices - Second Edition(July 2010).
• Russian--The Chamber of Auditors of the Republic of Kazakhstan is translating the Handbook of International Standards on Auditing and Quality Control - 2009 Edition into both Russian and Kazakh. 
  
  The Ministry of Finance of the Republic of Kazakhstan is translating the Handbook of International Public Sector Accounting Pronouncements - 2010 Edition into both Russian and Kazakh.
  
  Russian translations of the SMP Committee publication, Guide to Quality Control for Small- and Medium-Sized Practices (March 2009), and the Framework for International Education Standards for Professional Accountants (December 2009) of the International Accounting Education Standards Board (IAESB) were performed by the Collegium of Auditors (Kazakhstan).
• Spanish--The Latin American Review Committee, coordinated by the Federación Argentina de Consejos Profesionales de Ciencias Económicas and including participants from IFAC member bodies in numerous Latin American countries, has completed the review of the translation of the IAASB Glossary of Terms performed by the translating bodies of Spain--Instituto de Censores Jurados de Cuentas de España (ICJCE) and Instituto de Contabilidad y Auditoría de Cuentas (ICAC)--and is in the process of reviewing the translations of the individual ISAs and ISQC 1 performed by the two Spanish bodies. The goal is to publish, during the first part of 2011, a Spanish language translation of the 2009 IAASB Handbook that is acceptable for use in Spain and Latin America.
  
  ICJCE has completed a Spanish language translation of the revised Code of Ethics for Professional Accountants (July 2009) and is in the process of finalizing its review

2. Other Translations Activities

• Translations of the IAASB's clarified standards have been published in numerous European languages, including Croatian, Czech, German, Finnish, Lithuanian, Norwegian, Polish, Portuguese, Romanian, Slovakian, Slovenian and Swedish. Translations of the clarified standards into other official languages of the European Union have been completed and are presently subject to finalization of the review by the European Commission's Directorate General of Translations (DGT), prior to their publication.
• Numerous translations of the revised IESBA Code of Ethics for Professional Accountants, various SMP Committee implementation guidance documents, and other publications issued by IFAC have been performed. Please see the IFAC Translations Database for more information.

3. What to Watch for in 2011

The following is an overview of some developments to watch for in 2011:

• Planned publication by the Arab Society of Certified Accountants (Jordan) of the Arabic translation of theHandbook of International Public Sector Accounting Pronouncements - 2010 Edition
  
• Planned publication by IFAC of the following policy statements/positions in the five official UN languages (Arabic, Chinese, French, Russian, and Spanish):
1. Policy for Reproducing, or Translating and Reproducing, Publications Issued by the International Federation of Accountants (December 2008) 
2. Policy for Translating and Reproducing Standards Issued by the International Federation of Accountants(December 2008) 
3. Modifications to International Standards of the International Auditing and Assurance Standards Board (IAASB) - A Guide for National Standard Setters that Adopt the IAASB's International Standards but Find It Necessary to Make Limited Modifications (Policy Position, July 2006)
• Translations of the IAASB's clarified standards in the other official languages of the European Union, to be published upon completion of the DGT review (including major world languages such as French, German, Italian, and Spanish)
• Planned publication of a Russian translation of the Handbook of International Standards on Auditing and Quality Control - 2009 Edition by the Chamber of Auditors of the Republic of Kazakhstan and Handbook of the Code of Ethics for Professional Accountants - 2010 Edition, being performed the Siberian Academy of Finance and Banking (Private Educational Institution of Higher Professional Education) (SAFB) and reviewed by representatives of various IFAC member bodies
• Possible Spanish language translations of certain SMP Committee implementation guides and the 2010 edition of the Handbook of International Public Sector Accounting Pronouncements (the latter with proposed funding by the World Bank)
• Possible translations of IFAC's Professional Accountancy Organization Development Committee's updated Toolkits into selected official UN languages

In connection with the 2010 World Congress of Accountants in Kuala Lumpur, Malaysia, IFAC hosted a meeting regarding the possibility of developing a single, high-quality Russian language translation of the IAASB's clarified standards that would be recognized by all Russian-speaking countries. Representatives of 14 organizations (mainly IFAC member bodies and associates) representing eight countries participated in the meeting.

There was strong interest in creating a multinational Russian language Review Committee to work towards this goal. By combining expertise and pooling resources, participating organizations will be able to achieve synergies and sustainable translation processes, thereby facilitating adoption and implementation of the clarified standards in individual countries.

5. Trados Translation Memory Software

IFAC's Translations function has recently commenced populating the translation memory software Trados with key terms and certain translated content. In addition to providing a central repository of translations, Trados will enable the creation of translation assets and development of sustainable translation processes. By storing translated content once in Trados, it will be possible to share and reutilize that content, thereby reducing processing time and the need to perform multiple or new translations. It will also enhance consistency in the use of translated terminology.

IFAC's member bodies and associates are encouraged to use Trados where possible to enhance the quality and efficiency of their translations and to more easily and effectively collaborate in regard to translations of standards and publications issued by IFAC. Please contact IFAC staff with questions or for relevant information.

6. Request for Translation Proposals

IFAC would especially welcome translation proposals for the following standards:

• Arabic, Chinese, or French translations of the Handbook of International Education Pronouncements - 2010 Edition
  
• Updated French translation of the Handbook of International Public Sector Accounting Pronouncements - 2010 Edition (the most recent French translation of the IPSASB Handbook is the 2007 edition)

7. Important Points Regarding IFAC Translations; Q&As and other Resources

• IFAC's publications are copyrighted material. Please refer to our relevant policy statements on www.ifac.org/about-ifac/translations-database and always ask permission before reproducing or translating any IFAC publications. You can ask for permission by contacting permissions@ifac.org.

• IFAC member bodies and other stakeholders are among our best resources for keeping the Translations Database up to date. Always feel free to alert us to any errors or issues.

• Use your fellow IFAC members and stakeholders as a resource in your reproduction and translation efforts. Cooperating with other IFAC bodies helps to reduce duplication of efforts and leads to more efficient use of existing resources. You will also find a helpful Questions and Answers (Q&A) document on our website:www.ifac.org/about-ifac/translations-permissions.

8. IFAC Job Posting: Associate, Translations and Permissions

IFAC is presently searching for an Associate for its Translations and Permissions function. The associate will support a wide range of activities, including using translation memory software to build translation assets, participating in/managing translation projects as appropriate, permission and contract management for translation and reproduction agreements, developing routines and processes, and assisting in the strategic development of the Translations and Permissions Department. For more information, please click here:

About IFAC
IFAC (www.ifac.org) 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. It is comprised of 164 members and associates in 125 countries and jurisdictions, representing approximately 2.5 million accountants in public practice, education, government service, industry, and commerce.