Compliance Responses and Action Plans

  • Compliance Responses and Action Plans

    IFAC members and associates have provided self-assessment information about the regulatory and standard-setting framework in their countries (Part 1) and their organizations' activities in addressing IFAC's membership requirements (Part 2) as described in the Statements of Membership Obligations. Based on an analysis of this information, they are developing SMO Action Plans for continuous development and improvement.

    Some organizations have qualified to submit SMO Action Plans on a biennial basis by meeting eligibility criteria. These organizations are indicated with an asterisk (*).

    In the interest of transparency and providing information to the profession, regulators, and other stakeholders, all responses and SMO Action Plans are accessible below.

    American Institute of Certified Public Accountants

     

    Introduction

    The information below has been submitted as part of the IFAC Member Body Compliance program. The Program has two components:

    Part 1: Assessment of the Regulatory and Standard-Setting Framework (provides information about regulatory requirements and standard-setting processes in member body countries); and
    Part 2: Assessment of Compliance (provides information on compliance by member bodies with the Statements of Membership Obligations). Part 2 of the Compliance Program will begin later this year, and the results will also be posted to the website.

    The responses to Part 1 are provided below. IFAC staff has reviewed the responses and, where necessary, validated them with external knowledgeable parties. A list of key terms is available to assist readers in understanding the responses.

    The purpose of this Part 1 Assessment is to collect information on the roles of IFAC member bodies and other organizations (including government, regulatory or other appointed authorities) with respect to:

    1. Setting auditing, accounting, ethics, public sector and education standards; and
    2. Regulating the accountancy profession.

    Sections 1 and 2 of Part 1 contain an introduction and instructions for member body respondents. For this reason, they are not included here, and the responses begin with Section 3.

    Questions or comments may be sent to complianceassessment@ifac.org.


    Section 3 -- Member Body General Information

    1. Country:

      United States of America


    2. Name of member body:
      American Institute of Certified Public Accountants

      Or please specify name:



    3. Individual responsible for preparation:
      James O'Malley


    4. Date member body became a member of IFAC:
      Note: Please enter a numeric date (e.g., 12/2001, Month/Year)

      10 / 1977



    Questions 5 - 22 are for internal use only


    Section 3G -- Affiliations


    23. Please list those regional organizations to which your organization belongs (e.g., FEE, CAPA, ECSAFA, IAA, etc.):
      Interamerican Accounting Association



    Section 4 -- Statutory Framework


    Responses to this section will provide a description of the legal framework governing the commercial aspects of auditing and financial reporting in your country.

    Section 4A -- The Companies Act or Commercial Code


    The following questions concern the Companies Act (the Act) or Commercial Code (the Code) or similar Legal authority in your country. If no Legal authority exists, or the Legal authority does not address particular questions, please indicate "N/A" for Not Applicable.

    24. What is the full name of:
      a). the Act or the Code: Uniform Commercial Code
      b). the Enacting body: The uniform law was approved by a non-governmental body, the National Conference of Commissioner on Uniform State Laws (NCUSL). It is then simply a legislative proposal addressed to fifty state legislatures. The final draft was prepared in the 1950s and was widely adopted by the states in the 1960s.
      c). date the Act or Code came into force: 10 / 1977


    25. How can IFAC obtain a copy of the Act or Code?
      A copy may be obtained at http://www.law.cornell.edu/ucc/ucc.table.html. A matrix indicating which states have adopted which provisions of the code may be obtained at http://www.law.cornell.edu/uniform/ucc.html.


    26. Is the Act or Code available in English?
      Yes   No


    27. What are the types of entities covered by the Act or the Code?
      Please check all that apply.
      Listed entities   Other (please specify): (Note: The Code does not set out requirements for an entity to prepare finanical statements.
      Private companies   Other (please specify):
      Governmental   Other (please specify):
      Not-for-profit   Other (please specify):


    28. Is there a requirement for the following entities to prepare annual statutory financial statements? If YES, please describe the financial reporting requirements including the accounting standards to be followed.
      Please check all that apply.
        No Yes (If YES, please describe)
      Listed entities As specified by Section 13(a) of the Securities Act 1934 - see AICPA Attachment for additional information.
      Private companies Most private companies are not required to prepare annual or quarterly financial statements. There are exceptions, for example, in some regulated industries, or entities that have government contracts, or receive government funding.
      Governmental
      Not-for-profit
      Other (please describe)
      Other (please describe)


    29. Is there a statutory requirement for the following entities to be audited? If YES, describe the requirement including the auditing standards to be followed:
      Please check all that apply.
        No Yes (If YES, please describe)
      Listed entities However, not under the Uniform Commercial Code but the Securities Exchange Act 1934. Listed entities are required to have their annual financial statements audited under the Securities Exchange Act of 1934 (section 13(a)(2)). Refer to the AICPA Attachment for additional information.
      Private companies Most private companies are not required to have their financial statements audited. There are exceptions, for example, in some regulated industries, or entities that have government contracts, or receive government funding. Also, other funding sources may impose audit requirements on private entities, for example private investors, lenders or other creditors.
      Governmental
      Not-for-profit
      Other (please describe)
      Other (please describe)


    30. Are the auditors ("statutory auditors") that are appointed for audits required by the Act or Code ("statutory audits") appointed for a specific period?
      Yes   No
      If YES, please indicate the term of appointment: Year(s)


    31. Who appoints the statutory auditors?
      Please check all that apply.
      Shareholders   Management
      Board of directors   Other (please specify):
      Audit committee   Other (please specify):
      Government agency   Other (please specify):


    32. Does the Act or Code require joint auditors for the statutory audit?
      Yes   No
      If yes, please describe the requirement:


    33. Does the Act or Code require the rotation of the auditors or audit firms performing statutory audits?
      Yes   No
      If yes, please describe the requirement:
      The AICPA Code of Conduct does not require the rotation of auditors or audit firms performing audits; however, the Sarbanes-Oxley Act of 2002 states that it shall be unlawful for a registered public accounting firm to provide audit services to an issuer if the lead (or coordinating) audit partner (having primary responsibility for the audit), or the audit partner responsible for reviewing the audit, has performed audit services for that issuer in each of the 5 previous fiscal years of that issuer.



    Section 4B -- Securities Market Regulations


    Responses to this section will provide a description of the financial reporting and auditing requirements for listed entities in your country.

    34. What are (a) the major items of Legal authority for such requirements, (b) the Enacting body(ies) and (c) the latest amendment date? Please identify the specific articles or sections that pertain to auditing and financial reporting:
    1. the major items of Legal authority for such requirements

      Section 13 (a) of the Securities Exchange Act of 1934. See the response to questions 28 and 29.

    2. the Enacting body(ies)

      The Securities Exchange Act of 1934 was approved by the United States Congress.

    3. the latest amendment date?

      The latest major amendment to the Securities Exchange of 1934 was mde by the Sarbanes-Oxley Act of 2002, which was approved by the US Congress in July 2002.


    35. How can IFAC obtain a copy of the Legal authority?
      A copy of the act is available at www.law.uc.edu/CCL34Act/index.html


    36. Is the Legal authority available in English?
      Yes   No


    37. Are there any additional or alternative financial statement reporting requirements for listed entities that are not described in your answer to Question 28?
      Yes   No
      If YES, please describe the requirement:
      A company that meets the deifnition of small-business issuer may use different forms for registration of its securities under the Securities Exchange Act, and for its quarterly and annual reports. A company that meets the definition of foreign issuer may use different forms for registration of its securities under the Securities Exchange Act, and for its quarterly and annual reports.


    38. Are there any additional auditing requirements that apply to listed entities other than those described in your answer to Question 29 (e.g., additional GAAS requirements, additional independence requirements, requirements to report to those charged with governance, etc.)?
      Yes   No
      If YES, please describe the requirement:


    39. Who appoints the statutory auditors of listed entities?
      Please check all that apply.
      Shareholders   Management
      Board of directors   Other (please specify):
      Audit committee   Other (please specify):
      Government agency   Other (please specify):


    40. Are auditors who perform audits of listed entities appointed for a specified period?
      Yes   No
      If YES, please indicate the term of appointment: Year(s)


    41. Are joint auditors required for audits of listed entities?
      Yes   No
      If YES, please describe the requirement:


    42. Is rotation of the auditor or audit firm for audits of listed entities required?
      Yes   No
      If YES, please describe the requirement:
      The AICPA Code of Conduct does not require the rotation of auditors or audit firms performing audits; however, the Sarbanes-Oxley Act of 2002 states that it shall be unlawful for a registered public accounting firm to provide audit services to an issuer if the lead (or coordinating) audit partner (having primary responsibility for the audit), or the audit partner responsible for reviewing the audit, has performed audit services for that issuer in each of the 5 previous fiscal years of that issuer.



    Section 5 -- Auditing Standards


    Responses to this section will provide a description of the legal and professional framework governing audit and other assurance standards in your country. The section focuses on the establishment of such standards. Please indicate the role your organization plays within this framework.

    Section 5A -- Statutory Framework


    43. Please provide the name of the Legal authority and/or self-regulatory rules that establish audit and other assurance standards in your country, the date of the last amendment of such authority or rules and the name of body responsible for setting audit and other assurance standards. If the standards are different for different entities (e.g., listed entities, private companies, governmental bodies, not-for-profit organizations, etc.), please specify the details that apply to each:
      Type of entity Name of
      applicable
      legal
      authority
      Date of last
      amendment
      (e.g. MM/YYYY 06/2001)
      Name of body responsible
      for setting audit and
      other assurance standards
      Listed entity Securities Exchange Act of 1934 as amended by the Sarbanes Oxley Act of 2002 07/2002 Public Company Accounting Oversight Board
      Other (please describe) Private Companies AICPA Rule 203, rules of professional conduct 05/2004 Auditing Standards Board
      Other (please describe) Government organizations, programs, activities, and functions, and of government assistance rec'd by contractors, nonprofit organizations, and other non-govt org. Certain law, regulations, and contrancts requrie auditors to follow generally accepted govt auditing standards promulgated by the Comptroller General of the US. Refer to the AICPA Attachment for additional information. United States General Accounting Office
      Other (please describe)

      a. How can IFAC obtain copies of these documents?

      The Securities Exchange Act of 1934 is available at http://www.law.uc.edu/CCL/34Act/index.html

      American Institute of Certified Public Accountants Rule 203, Rules of Professional Conduct is available upon request from the AICPA.

      The Inspector General Act of 1978 is available at http://www.access.gpo.gov/uscode/title5a/5a_2_.html.

      The Chief Financial Officers Act of 1990 is available at http://wwwoirm.nih.gov/itmra/cfoact.html.

      The Single Audit Act Amendments of 1996 is available at http://www.ignet.gov/single/saamend.html.


      b. Are the documents available in English?
      Yes   No


    Section 5B -- Standard-Setting (Public Company Accounting Oversight Board)


    44. For Public Company Accounting Oversight Board, please indicate the nature of the body (i.e., whether it is part of a government ministry or department, an agency appointed by government, a private organization established by the profession, or other [please describe]) and the name of the standards.
      a. Nature of body

      The PCAOB is a private-sector, non-profit corporation, created by the Sarbanes-Oxley Act of 2002.

      b. Name of standards

      Auditing Standards


    45. How many voting members does the standard-setting body have?
      5


    46. Are the members of the standard-setting body involved on a voluntary basis or employed by the standard-setting body?
      Voluntary  
      Employed  
      Both - Please describe:


    47. What are the criteria considered in selecting members of the standard-setting body (e.g., best person for the job, sector of the profession, private and public members, academic, geographical representation, etc.)?
      From the Sarbanes-Oxley Act of 2002: Board members are appointed from among prominent individuals of integrity and reputation who have a demonstrated commitment to the interests of investors and the public, and an understanding of the responsibilities for and nature of the financial disclosures required of issuers under the securities laws and the obligations of accountants with respect to the preparation and issuance of audit reports with respect to such disclosures.

      Two members, and only 2 members, of the Board shall be or have been certified public accountants, provided that, if 1 of those 2 members is the chairperson, he or she may not have been a practicing certified public accountant for at least 5 years prior to his or her appointment to the Board.


    48. Who appoints these members (e.g., member body, government, user, regulator, etc.)?
      From the Sarbanes-Oxley Act of 2002: The Securities and Exchange Commission, after consultation with the Chairman of the Board of Governors of the Federal Reserve System and the Secretary of the Treasury.


    49. What is the term of appointment for members?
      5 Year(s)


    50. For how many years has the standard-setting body been in existence?
      2 Year(s)


    51. Please indicate the budget in US$ of the standard-setting body for the last fiscal year:
      Note: Please enter a whole number using commas (e.g., 4,000,000)

      101,247,000

      Please enter the exchange rate used to calculate this number.

      Note: Please enter a decimal amount (e.g., 4.0027)

      1.0000



    52. To what entity is the standard-setting body accountable?
      From the Sarbanes-Oxley Act of 2002: The Board shall submit an annual report (including its audited financial statements) to the Securities and Exchange Commission, and the Commission shall transmit a copy of that report to the Committee on Banking, Housing, and Urban Affairs of the Senate, and the Committee on Financial Services of the House of Representatives.


    53. Describe the due process followed by the standard-setting body. Please include explanations of the following:
    1. public exposure of standards

      Any questions regarding the PCAOB's due proces should be addressed to the PCAOB.

    2. accessibility of meetings (i.e., public or private)

      Any questions regarding the PCAOB's due proces should be addressed to the PCAOB.

    3. approval process for final standards (i.e., majority required to approve final standards)

      Any questions regarding the PCAOB's due proces should be addressed to the PCAOB.

    4. other relevant due process activities



    54. Approximately how many days per year does the standard-setting body meet in full session (including teleconferences)?
      Day(s)


    Section 5B -- Standard-Setting (Auditing Standards Board)


    44. For Auditing Standards Board, please indicate the nature of the body (i.e., whether it is part of a government ministry or department, an agency appointed by government, a private organization established by the profession, or other [please describe]) and the name of the standards.
      a. Nature of body

      The Auditing Standards Board (ASB) is the senior technical committee of the AICPA.

      The American Institute of Certified Public Accountants is the national, professional organization for all Certified Public Accountants.

      Note: The Committee on Auditing Procedure was formed in 1939. In 1972, it was reconstituted as the Auditing Standards Executive Committee to reflect a shift from providing audit guidance to promulgating auditing standards. It was reconstituted again in 1978 as the Auditing Standards Board (ASB).


      b. Name of standards

      Statements on Auditing Standards (SAS)


    45. How many voting members does the standard-setting body have?
      19


    46. Are the members of the standard-setting body involved on a voluntary basis or employed by the standard-setting body?
      Voluntary  
      Employed  
      Both - Please describe: Note: Although the members are involved on a voluntary basis, they may request reimbursement for travel expenses. They also may request a stipend of $50 per hour for up to 800 hours per year for time spent on ASB activities. This makes it easier for small-firm practitioners to participate, and makes it easier to achieve the appropriate balance between the large- and small-firm practitioners. Traditionally, the large-firm members do not request the reimbursement for travel expenses or the stipend.


    47. What are the criteria considered in selecting members of the standard-setting body (e.g., best person for the job, sector of the profession, private and public members, academic, geographical representation, etc.)?


    48. Who appoints these members (e.g., member body, government, user, regulator, etc.)?


    49. What is the term of appointment for members?
      3 Year(s)


    50. For how many years has the standard-setting body been in existence?
      65 Year(s)


    51. Please indicate the budget in US$ of the standard-setting body for the last fiscal year:
      Note: Please enter a whole number using commas (e.g., 4,000,000)

      1,811,438

      Please enter the exchange rate used to calculate this number.

      Note: Please enter a decimal amount (e.g., 4.0027)

      1.000



    52. To what entity is the standard-setting body accountable?
      The ASB is the senior technical committee of the AICPA designated to issue auditing, attestation, and quality control standards and guidance. It is authorized to make public statements on matters relating to auditing, attestation, and quality control standards without clearance from Council or the Board of Directors. Ultimately, the ASB is accountable to the AICPA Council.


    53. Describe the due process followed by the standard-setting body. Please include explanations of the following:
    1. public exposure of standards

      Statements on Auditing Standards, Statements on Standards for Attestation Engagements and Statements on Quality Control Standards:

      These publications are standards issued by the ASB. Rule 202 of the AICPA Code of Professional Conduct requires a member who performs an audit to comply with standards promulgated by the ASB. The ASB develops and issues standards in the form of Statements on Auditing Standards, Statements on Standards for Attestation Engagements, and Statements on Quality Control Standards (together, "ASB Statements") through a due process that includes deliberation in meetings open to the public, public exposure of proposed ASB Statements, and a formal vote.

      Interpretative Publications:

      Interpretative Publications are issued to provide guidance on the application of ASB Statements. The Audit and Attest Standards staff develops interpretations, sometimes with the assistance of ASB members or other volunteers. Interpretations are reviewed by the Audit Issues Task Force (see Note 1 below), and approved by the ASB Chair and the Director. Interpretations are issued under the authority of the ASB after all ASB members have been provided an opportunity to consider and comment on whether the proposed interpretation is consistent with the ASB Statements. ASB members are provided at least two weeks to consider and comment on proposed interpretations.

      Note 1: The ASB Chair and the Director are responsible for preparing short- and longer-range operating and project plans for the ASB, including an agenda of projects and their priorities. The ASB Chair and the Director also are responsible for planning and monitoring the ASB's work. To assist them in preparing such operating plans and other administrative and technical responsibilities, the ASB Chair, in consultation with the Director, nominates, and the ASB approves, a slate of ASB members to serve on the Audit Issues Task Force.


    2. accessibility of meetings (i.e., public or private)

      Those portions of ASB meetings relating to (a) the establishment of standards through ASB Statements and (b) other auditing, attestation and reporting matters directly affecting the public interest are open to the public. Portions of meetings dealing with matters of an administrative or necessarily confidential nature, such as meeting arrangements, establishment of task forces, and consideration of advice of AICPA counsel, need not be open to the public. Meetings of the subcommittees and task forces of the ASB are not open to the public; however at the discretion of the ASB Chair, or at the discretion of the chair of the subcommittee or task force (after discussing the request with the ASB Chair), interested parties may be invited to attend any or all meetings of any ASB subcommittee or task force.

      The ASB holds five meetings per year (each meeting is 2.5 days).


    3. approval process for final standards (i.e., majority required to approve final standards)



    4. other relevant due process activities



    54. Approximately how many days per year does the standard-setting body meet in full session (including teleconferences)?
      13 Day(s)


    Section 5B -- Standard-Setting (United States General Accounting Office)


    44. For United States General Accounting Office, please indicate the nature of the body (i.e., whether it is part of a government ministry or department, an agency appointed by government, a private organization established by the profession, or other [please describe]) and the name of the standards.
      a. Nature of body

      United States General Accounting Office, Comptroller General as advised by the
      Advisory Council on Government Auditing Standards. Note: technically, the Comptroller General sets the standards; however, the answers that follow are related to the Advisory Council on Government Auditing Standards. The US General Accounting Office has been in existence for 83 years. The Comptroller General first issued standards for government auditing in 1972; major revisions were made in 1981, 1988, 1984, and 2003.

      The General Accounting Office is the audit, evaluation, and investigative arm of the US Congress.

      United States General Accounting Office, Comptroller General as advised by the
      Advisory Council on Government Auditing Standards. Note: technically, the Comptroller General sets the standards; however, the answers that follow are related to the Advisory Council on Government Auditing Standards.


      b. Name of standards

      Generally Accepted Government Auditing Standards (GAGAS)


    45. How many voting members does the standard-setting body have?
      25


    46. Are the members of the standard-setting body involved on a voluntary basis or employed by the standard-setting body?
      Voluntary  
      Employed  
      Both - Please describe:


    47. What are the criteria considered in selecting members of the standard-setting body (e.g., best person for the job, sector of the profession, private and public members, academic, geographical representation, etc.)?
      Collectively, they provide strong knowledge of financial, compliance, and performance auditing and program evaluation at all levels of government. There is a mix of both practitioners (from both large and small firms) and users at all levels of government, as well as academics.


    48. Who appoints these members (e.g., member body, government, user, regulator, etc.)?
      They are appointed by the Comptroller General. The new members are selected from nominations received from relevant professional organizations.


    49. What is the term of appointment for members?
      3 Year(s)


    50. For how many years has the standard-setting body been in existence?
      32 Year(s)


    51. Please indicate the budget in US$ of the standard-setting body for the last fiscal year:
      Note: Please enter a whole number using commas (e.g., 4,000,000)

      432,000,000 GAO budget (not just for standard-setting)

      Please enter the exchange rate used to calculate this number.

      Note: Please enter a decimal amount (e.g., 4.0027)

      1.0000



    52. To what entity is the standard-setting body accountable?
      United States Congress


    53. Describe the due process followed by the standard-setting body. Please include explanations of the following:
    1. public exposure of standards

      Standards are exposed to the public in accordance with the Administrative Procedures Act, the pertinent part which can be found at http://www.archives.gov/federal_register/public_laws/administrative_procedure_act/553.html.

    2. accessibility of meetings (i.e., public or private)

      Meetings are open to the public in accordance with the Administrative Procedures Act, the pertinent part which can be found at http://www.archives.gov/federal_register/public_laws/administrative_procedure_act/552b.html. At the end of every meeting, there is an open comment-period where participants can provide comments and feed-back.

      They meet approximately 4-6 days.


    3. approval process for final standards (i.e., majority required to approve final standards)

      The Advisory Council, upon reaching consensus, will make recommends to the Comptroller General, who decides on the final standards. The Advisory Council does not have a voting policy.

    4. other relevant due process activities

      The Comptroller General and the Advisory Council often meet with constituents when developing projects. In addition to the due-process procedures, the Comptroller General often seeks comments from specific constituents throughout the process.


    54. Approximately how many days per year does the standard-setting body meet in full session (including teleconferences)?
      6 Day(s)



    Section 6 -- Ethics


    Responses to questions in this section will provide a description of the legal and professional framework governing ethics standards for accountants in your country. This section focuses on the establishment of such standards. Please indicate the role your organization plays within this framework.

    Section 6A -- Statutory Framework


    55. For each of the following types of professionals, please indicate the name of the Legal authority and/or self-regulatory rules establishing ethics standards for accountants and auditors in your country, the date of the last amendment of such authority or rules and the name of body responsible for setting the ethics standards.
      Type of professional covered Name of
      applicable
      legal
      authority
      Date of last
      amendment
      (e.g. MM/YYYY 06/2001)
      Name of body responsible
      for setting ethics standards
      Professional Accountants in Public Practice AICPA Code of Professional Conduct, State Boards of Accountancy rules and regulations, SEC Rule 2-01 of Regulation S-X. See AICPA Attachment for responses to questions 55-66 relating to State Boards of Accountancy and SEC Rule 2-01. AICPA Code of Professional Conduct 12/2003 AICPA Professional Ethics Executive Committee
      Professional Accountants in Business AICPA Code of Professional Conduct and State Boards of Accountancy rules and regulations, SEC rules and regulations. See AICPA Attachment for responses to questions 55-66 regarding the State Boards and SEC regulations. AICPA Code of Professional Conduct 12/2003 AICPA Professional Ethics Executive Committee
      Professional Accountants in the Public Sector AICPA Code of Professional Conduct and Generally Accepted Government Auditing Standards, Amendment No. 3. See AICPA Attachment for information regarding GAGAS Amendment No. 3 AICPA Code of Professional Conduct 12/2003 AICPA Professional Ethics Executive Committee
      Other (please describe) Professional Accountants in Public Practice PCAOB 04/2003 PCAOB

      a. How can IFAC obtain copies of these documents?

      AICPA Code can be obtained at http://www.aicpa.org/about/code/index.htm.

      SEC independence rules can be obtained at www.sec.gov.

      PCAOB rules can be obtained at http://www.pcaobus.org/rules/Release2003-006.pdf

      The GAO independence rules can be obtained at http://www.gao.gov/govaud/ybk01.htm

      Access to the various state boards rules can be obtained at http://www.aicpa.org/states/info/index.htm


      b. Are the documents available in English?
      Yes   No


    Section 6B -- Standard-Setting (AICPA Professional Ethics Executive Committee)


    56. For AICPA Professional Ethics Executive Committee, please indicate the nature of the body (i.e., whether it is part of a government ministry or department, an agency appointed by government, a private organization established by the profession, or other [please describe]) and the name of the standards.
      a. Nature of body



      b. Name of standards

      AICPA Code of Professional Conduct


    57. How many voting members does the standard-setting body have?
      20


    58. Are the members of the standard-setting body involved on a voluntary basis or employed by the standard-setting body?
      Voluntary  
      Employed  
      Both - Please describe: The PEEC is comprised of 20 members. Seventeen members are volunteers while three members are from the public (non-CPAs) and compensated by the AICPA.


    59. What are the criteria considered in selecting members of the standard-setting body (e.g., best person for the job, sector of the profession, private and public members, academic, geographical representation, etc.)?
      Members are appointed so that there is representation from public practice (including small, medium and large firms), business and industry, government, educators, state regulators and the public. Relevant experience with respect to ethics and independence is sought.


    60. Who appoints these members (e.g., member body, government, user, regulator, etc.)?
      The Director of the AICPA Professional Ethics Division, in consultation with the PEEC Chair, nominates the members of the PEEC. The AICPA Board of Directors approves nominations for members of the PEEC.


    61. What is the term of appointment for members?
      3 Year(s)


    62. For how many years has the standard-setting body been in existence?
      98 Year(s)


    63. Please indicate the budget in US$ of the standard-setting body for the last fiscal year:
      Note: Please enter a whole number using commas (e.g., 4,000,000)

      3.500.000 is the total budget which includes standard-setting, enforcement activities, and salaries.

      Please enter the exchange rate used to calculate this number.

      Note: Please enter a decimal amount (e.g., 4.0027)

      1.000



    64. To what entity is the standard-setting body accountable?
      The PEEC is the senior technical committee of the AICPA designated to interpret the AICPA Code of Professional Conduct, make amendments to the Code and enforce the rules of conduct. Ultimately, the PEEC is accountable to the AICPA Council.


    65. Describe the due process followed by the standard-setting body. Please include explanations of the following:
    1. public exposure of standards



    2. accessibility of meetings (i.e., public or private)



    3. approval process for final standards (i.e., majority required to approve final standards)

      All standard-setting activities are conducted at meetings open to the public.

    4. other relevant due process activities

      Proposed standards are deliberated and approved at meetings open to the public. All comment letters also are considered at the open meeting. A 2/3 majority of voting members is required to approve a final standard. All final standards are released in the Journal of Accountancy (AICPA periodical) and posted to the AICPA website.


    66. Approximately how many days per year does the standard-setting body meet in full session (including teleconferences)?
      9 Day(s)


    Section 6B -- Standard-Setting (PCAOB)


    56. For PCAOB, please indicate the nature of the body (i.e., whether it is part of a government ministry or department, an agency appointed by government, a private organization established by the profession, or other [please describe]) and the name of the standards.
      a. Nature of body

      The PCAOB is a private-sector, non-profit corporation, created by the Sarbanes-Oxley Act of 2002. Its standards are applicable to listed entities.

      b. Name of standards

      PCAOB ethics and independence standards. See PCAOB Rule 3500 and 3600T.


    57. How many voting members does the standard-setting body have?
      5


    58. Are the members of the standard-setting body involved on a voluntary basis or employed by the standard-setting body?
      Voluntary  
      Employed  
      Both - Please describe:


    59. What are the criteria considered in selecting members of the standard-setting body (e.g., best person for the job, sector of the profession, private and public members, academic, geographical representation, etc.)?
      From the Sarbanes-Oxley Act of 2002: Board members are appointed from among prominent individuals of integrity and reputation who have a demonstrated commitment to the interests of investors and the public, and an understanding of the responsibilities for and nature of the financial disclosures required of issuers under the securities laws and the obligations of accountants with respect to the preparation and issuance of audit reports with respect to such disclosures.

      Two members, and only 2 members, of the Board shall be or have been certified public accountants, provided that, if 1 of those 2 members is the chairperson, he or she may not have been a practicing certified public accountant for at least 5 years prior to his or her appointment to the Board.


    60. Who appoints these members (e.g., member body, government, user, regulator, etc.)?
      From the Sarbanes-Oxley Act of 2002: The Securities and Exchange Commission, after consultation with the Chairman of the Board of Governors of the Federal Reserve System and the Secretary of the Treasury


    61. What is the term of appointment for members?
      5 Year(s)


    62. For how many years has the standard-setting body been in existence?
      2 Year(s)


    63. Please indicate the budget in US$ of the standard-setting body for the last fiscal year:
      Note: Please enter a whole number using commas (e.g., 4,000,000)

      101,247,000 represents the total budget inlcuding standard-setting, enforcement activities, and salaries.

      Please enter the exchange rate used to calculate this number.

      Note: Please enter a decimal amount (e.g., 4.0027)

      1.000



    64. To what entity is the standard-setting body accountable?
      From the Sarbanes-Oxley Act of 2002: The Board shall submit an annual report (including its audited financial statements) to the Securities and Exchange Commission, and the Commission shall transmit a copy of that report to the Committee on Banking, Housing, and Urban Affairs of the Senate, and the Committee on Financial Services of the House of Representatives.


    65. Describe the due process followed by the standard-setting body. Please include explanations of the following:
    1. public exposure of standards



    2. accessibility of meetings (i.e., public or private)



    3. approval process for final standards (i.e., majority required to approve final standards)



    4. other relevant due process activities



    66. Approximately how many days per year does the standard-setting body meet in full session (including teleconferences)?
      Day(s)



    Section 7 -- Education


    Responses to questions in this section will provide a description of how education requirements for the profession are established. Please indicate the role your organization plays within this process.

    Section 7A -- Education Requirements


    67. Please describe in general terms the education system in your country including the different stages of education from early childhood education through to tertiary level study. Please indicate which aspects / levels are compulsory as part of the national education system:
      The system in the US includes education from K-12 (Kindergarten, 6 years elementary, 2 years junior high school, 4 years high school). Collegiate education includes associate degree programs (2 years), bachelors/undergraduate degree programs (4 years) and masters/graduate programs (1-2 years). Doctoral programs as well as other professional degree programs such as law and medicine require several years beginning at the masters degree level. The 12 years from elementary through to high school are compulsory.


    68. Is there a legal authority or regulation that specifies the requirements for an individual to operate as an accountant or auditor in your country?
      Yes   No

      If YES, please provide the name and describe the requirements, including any relating to education, experience or qualifications.

      All CPAs are examined, licensed, and regulated under state accountancy laws, and there is such a law in every American jurisdiction. Each of the 54 jurisdictions has a state board of accountancy (state legal entity) that determines the requirements for entry into the profession, grants certificates and licenses to practice, and regulates the practice of accountancy in the state/jurisdiction. The entry level requirements include education, passage of the Uniform CPA Examination and practical experience.

      With respect to question 70, the state boards of accountancy establish the education requirement for certification. The AICPA also has an education requirement of 150-semester hours for membership. (This is not in addition to the education requirement for certification. Individuals certified in a non-150-semester hour state must meet the AICPA education requirement for membership.)


    69. Please select from below all the relevant key levels of requirements to obtain certification from your member body (i.e. to qualify as a certified or chartered accountant) and provide a general description of the requirement.
      Academic requirements
      The great majority of states (43 currently; another 5 within the next several years) require 5 years of collegiate education (150-semester hours), including a bachelors degree, for CPA certification. The educational preparation includes accounting knowledge and skills, business knowledge and skills and general/liberal arts components.
      Professional examinations
      Practical experience
      The experience requirement varies from zero (in 2 states) to 2 years (in 20 states). The balance of the states require one year of experience. Most states require a component of the experience to be in audit and assurance services.
      Final qualifying examination
      All 54 states require passage of the Uniform CPA Examination. The 14-hour examination includes coverage of auditing and attestation; financial accounting and reporting; regulation, including federal taxation, ethics, professional and legal responsibilities and business law, and business environment and concepts as well as the related skills.
      Other (please describe)
      Some states require an ethics examination in addition the Unifoirm CPA Examination.

      The state boards of accountancy establish the education requirement for certification. The AICPA also has an education requirement of 150-semester hours for membership. (This is not in addition to the education requirement for certification. Individuals certified in a non-150-semester hour state must meet the AICPA education requirement for membership.)


    70. Which of the following arrangements best describes who establishes the education requirements for the accounting profession in your country? Please select one option.
      A government ministry, department or agency establishes education requirements for the accounting profession with no additional requirements set by the member body(ies).
      A government ministry, department or agency establishes minimum education requirements for the accounting profession, and member body(ies) supplement these requirements.
      Member body(ies) establishes the education requirements for the accounting profession.
      Other (please describe)


    71. Please provide the name(s) of the relevant body in the government ministry, department, agency and / or member body who establishes the education requirements.
      Information may be obtained from the State Board of Accountancy. For contact information, go to http://www.aicpa.org/states/stmap.htm.

    1. A general description of the role of the relevant body(ies) including how it operates and its due process in establishing the education requirements.

    2. How many voting members does the relevant body(ies) have

      Varies from state to state.

    3. Are the members of the relevant body(ies) involved on a voluntary basis or employed by the standard-setting body?
      Voluntary  
      Employed  
      Both - Please describe: The boards of accountancy are comprised of volunteer licensees in the statesas well as full time staff.

    4. For how many years has the body been in existence?

      Year(s)


    72. How would you describe the authority that the education requirements have?
      Requirements are legally-based
      Requirements are set in the constitution, by-laws or other rules of the relevant body(ies).
      Requirements are set in member body(ies) policy document(s).
      Other (please describe)

    72 a. How can IFAC obtain copies of these documents?
      By contacting each State Board of accountancy. For contact information, go to http://www.aicpa.org/states/stmap.htm.

    72 b. Are these documents available in English?
      Yes   No


    73. Are the education requirements for accountants and auditors the same throughout your country, or do they differ among regions, provinces or states?
      Same   Different
      If different, please briefly describe the main differences:
      There are differences as indicated in question 68 (state-level differences).

      With respect to question 74, the education programs are delivered by educational institutions (universities, etc.). The CPA Examination is prepared by the American Institute of CPAs (AICPA), with oversight of the National Association of State Boards of Accountancy (a federation of the state boards) and delivered to candidates through testing centers. Grading of the examination is provided by the AICPA and reported to candidates by the state boards of accountancy.


    74. Please indicate the scenario that best describes who delivers the education and examination process for members of the profession. Please only select one option.
      The education program and final examination are delivered by the member body.
      The education program and final examination are delivered by the member body and other education institutions (e.g., universities, colleges, and others).
      The education program and final examination are delivered by education institutions (e.g., universities, colleges, and others).
      Other (please explain) Please refer to commentary in questoin 73.


    75. Once qualified as a member of your professional body, can members offer their services directly to the public?
      Yes   No



    Section 7B -- Licensing


    76. Are there licensing requirements for auditors in your country?
      Yes (continue with Question 77)   No (proceed to Section 8)


    77. Who sets the requirements to obtain a license?
      To become a CPA, a candidate must meet the requirements of the state or jurisdiction in which he or she wishes to practice. These requirements, which vary from stae to state, are established by law and administered by the state boards of accountancy.


    78. What are the requirements to obtain a license (please select all relevant requirements.)?
      Academic study specific for obtaining a license
      Practical experience
      Licensing examination
      Final qualifying examination
      Other (please describe)
      Some states have age, citizenship, and residency requirements. The requirements vary by states. Please refer to http://www.nasba.org/NASBAfiles.nsf/3BC653050D8FA086256C1B00792FF5/$file/CPAPractiReq2002.PDF


    79. Are there ongoing requirements to retain a license?
      Yes   No

      If YES, please select all relevant requirements.
      Continuing professional development
      Re-examination
      Other (please specify):


    80. What entity grants the license?
      Licenses are garanted by each of the 54 State Boards of Accountancy


    81. Describe any additional licensing requirements for auditors of listed entities (e.g., additional education requirements, registration, etc.).
      Auditors of listed entitites are required to register with the PCAOB.



    Section 8 -- Public Sector Accounting Standards


    Responses to this section will provide a description of the legal and professional framework governing public sector accounting standards in your country. The section focuses on the establishment of such standards. Please indicate, where appropriate, the role of your organization within this framework.

    Section 8A -- Statutory Framework


    82. Please provide the name of the Legal authority and/or self-regulatory rules establishing public sector accounting standards in your country, the date of last amendment and the name of the body responsible for setting public sector accounting standards. If the standards are different for different entities (e.g., whole of government, ministry/department, statutory authority/agency, profit entity owned by government, state governments, local governments, other [please specify]), please specify the details that apply to each.
      Type of entity Name of
      legal
      authority
      Date of last
      amendment
      (e.g. MM/YYYY 06/2001)
      Name of body responsible
      for setting public sector
      accounting standards
      Whole of government Federal Accounting Standards Advisory Board (FASAB)
      Ministry/department Federal Accounting Standards Advisory Board (FASAB)
      Statutory authority/agency See FASAB for Federal and GASB for State and Local Federal Accounting Standards Advisory Board (FASAB)
      Profit entity owned by government See FASAB for Federal and GASB for State and Local
      State governments Governmental Accounting Standards Board (GASB) for State and Local)
      Local governments Governmental Accounting Standards Board (GASB) for State and Local)
      Other (please describe)
      Other (please describe)

      a. How can IFAC obtain copies of these documents?

      Refer to government websites.

      b. Are the documents available in English?
      Yes   No


    Section 8B -- Standard-Setting (Federal Accounting Standards Advisory Board (FASAB))


    83. For Federal Accounting Standards Advisory Board (FASAB), please indicate the nature of the body (i.e., whether it is part of a government ministry or department, an agency appointed by government, a private organization established by the profession, or other [please describe]) and the name of the standards.
      a. Nature of body

      Federal advisory committee- a committee appointed by government

      b. Name of standards

      Statements of Federal Financial Accounting Standards


    84. How many voting members does the standard-setting body have?
      10


    85. Are the members of the standard-setting body involved on a voluntary basis or employed by the standard-setting body?
      Voluntary  
      Employed  
      Both - Please describe:


    86. What are the criteria considered in selecting members of the standard-setting body (e.g., best person for the job, sector of the profession, private and public members, academic, geographical representation, etc.)?
      Four federal members are appointed by their agency heads. For non-federal members, various criteria are considered and an appointments panel comprising federal and non-federal members is consulted.


    87. Who appoints these members (e.g., member body, government, user, regulator, etc.)?
      Appointment of the six non-federal members is made by the government. The Secretary of the Treasury, the Director of the Office of Management and Budget and the Comptroller General make the appointment jointly.


    88. What is the term of appointment for members?
      5 Year(s)


    89. For how many years has the standard-setting body been in existence?
      13 Year(s)


    90. Please indicate the budget in US$ of the standard-setting body for the last fiscal year:
      Note: Please enter a whole number using commas (e.g., 4,000,000)

      1,600,000

      Please enter the exchange rate used to calculate this number.

      Note: Please enter a decimal amount (e.g., 4.0027)

      1.0000



    91. To what entity is the standard-setting body accountable?


    92. Describe the due process followed by the standard-setting body. Please include explanations of the following:
    1. public exposure of standards

      A minimum of 90 days is afforded for public comments

    2. accessibility of meetings (i.e., public or private)

      Public meetings are required. Deliberations in private are not permitted under by the Federal Advisory Committee Act.

    3. approval process for final standards (i.e., majority required to approve final standards)

      Majority requried. Dissents are published in final statement.

    4. other relevant due process activities

      Public hearings are held.


    93. Approximately how many days per year does the standard-setting body meet in full session (including teleconferences)?
      12 Day(s)


    Section 8B -- Standard-Setting (Governmental Accounting Standards Board (GASB) for State and Local))


    83. For Governmental Accounting Standards Board (GASB) for State and Local), please indicate the nature of the body (i.e., whether it is part of a government ministry or department, an agency appointed by government, a private organization established by the profession, or other [please describe]) and the name of the standards.
      a. Nature of body

      Private Organization

      b. Name of standards

      Statements of Governmental Accounting Standards, Interpretation, Technical Bulletins, Implementation Guides.

      Please note: Pronouncements of the GASB's predecessor body, the National Council on Governmental Accounting, remain in effect unless superseded by the GASB.


    84. How many voting members does the standard-setting body have?
      7


    85. Are the members of the standard-setting body involved on a voluntary basis or employed by the standard-setting body?
      Voluntary  
      Employed  
      Both - Please describe:


    86. What are the criteria considered in selecting members of the standard-setting body (e.g., best person for the job, sector of the profession, private and public members, academic, geographical representation, etc.)?
      Members must possess "knowledge of accouting, finance and government, and a concern for public interest in matters of financial accounting and reporting." Collectively, the Baord should represent diverse backgrounds (government, public accounting, academia, financial analyst); however, there is not a set maeu-up of the Board.


    87. Who appoints these members (e.g., member body, government, user, regulator, etc.)?
      Members are appointed by the Financeial Accounting Foundation(a private-sector foundation.


    88. What is the term of appointment for members?
      5 Year(s)


    89. For how many years has the standard-setting body been in existence?
      20 Year(s)


    90. Please indicate the budget in US$ of the standard-setting body for the last fiscal year:
      Note: Please enter a whole number using commas (e.g., 4,000,000)

      5,500,000

      Please enter the exchange rate used to calculate this number.

      Note: Please enter a decimal amount (e.g., 4.0027)

      1.0000



    91. To what entity is the standard-setting body accountable?
      It is responsible to the Financial Accounting Foundation Baord of Trustees - 16 members that represent the public interest.


    92. Describe the due process followed by the standard-setting body. Please include explanations of the following:
    1. public exposure of standards



    2. accessibility of meetings (i.e., public or private)



    3. approval process for final standards (i.e., majority required to approve final standards)



    4. other relevant due process activities



    93. Approximately how many days per year does the standard-setting body meet in full session (including teleconferences)?
      36 Day(s)



    Section 9 -- Private Sector Accounting Standards


    Responses to the questions in this section will provide a description of the legal, statutory and professional framework governing private-sector accounting standards in your country. The section focuses on the establishment of such standards. Please indicate what role your organization plays within this framework.

    Section 9A -- Statutory Framework


    94. Please provide the name of the Legal authority and/or self-regulatory rules that establish private-sector accounting standards in your country, the date of last amendment, and the name of the body responsible for setting private sector accounting standards. If the standards are different for different entities (for example, listed entities, private companies, governmental organization, not for profit organizations, etc.), please specify the requirements that apply to each.
      Type of entity Name of legal
      authority or
      applicable
      rules
      Date of last
      amendment
      (e.g. MM/YYYY 06/2001)
      Name of body responsible
      for setting private sector
      accounting standards
      Listed entity Securities Act of 1933, Section 19 (15 U.S.C. 77s) 07/30/2002 United States Securities and Exchange Commission
      Other (please describe) United States Securities and Exchange Commission (SEC) registrant Recognized by the SEC pursuant to Securities Act of 1933, Section 19 (15 U.S.C. 77s) 07/30/2002 Financial Accounting Standards Board (FASB)
      Other (please describe) United States Securities and Exchange Commission (SEC) registrant AICPA Statement on Auditing Standards No. 69 06/1993 AICPA Accounting Standards Executive Committee (AcSEC)
      Other (please describe) Private companies (not SEC registrants), not-for-profit organizations AICPA Statement on Auditing Standards No. 69 06/1993 AICPA Accounting Standards Executive Committee (AcSEC)
      Other (please describe) Private companies (not SEC registrants), not-for-profit organizations AICPA Statement on Auditing Standards No. 69 06/1993 Financial Accounting Standards Board (FASB)

      a. How can IFAC obtain copies of these documents?

      FASB pronouncements can be obtained at
      http://www.fasb.org

      AICPA pronouncements can be obtained at
      http://www.aicpa.org

      SEC pronouncements are available through commercial publishers such as CCH (http://business.cch.com)


      b. Are the documents available in English?
      Yes   No


    Section 9B -- Standard-Setting (United States Securities and Exchange Commission)


    95. For United States Securities and Exchange Commission, please indicate the nature of the body (i.e., whether it is part of a government ministry or department, an agency appointed by government, a private organization established by the profession, or other [please describe]) and the name of the standards.
      a. Nature of body

      Government Agency

      b. Name of standards

      Accounting Series Releases, Financial Reporting Releases, Staff Accounting Bulletins


    96. How many voting members does the standard-setting body have?
      5


    97. Are the members of the standard-setting body involved on a voluntary basis or employed by the standard-setting body?
      Voluntary  
      Employed  
      Both - Please describe:


    98. What are the criteria considered in selecting members of the standard-setting body (e.g., best person for the job, sector of the profession, private and public members, academic, geographical representation, etc.)?
      SEC: Commissioners are appointed by the President and go through Congressional confirmation.


    99. Who appoints these members (e.g., member body, government, user, regulator, etc.)?
      SEC: Commissioners are appointed by the President and go through Congressional confirmation.


    100. What is the term of appointment for members?
      5 Year(s)


    101. For how many years has the standard-setting body been in existence?
      70 Year(s)


    102. Please indicate the budget in US$ of the standard-setting body for the last fiscal year:
      Note: Please enter a whole number using commas (e.g., 4,000,000)

      Not separated from entire agency budget.

      Please enter the exchange rate used to calculate this number.

      Note: Please enter a decimal amount (e.g., 4.0027)

      1.0000



    103. To what entity is the standard-setting body accountable?
      The SEC is an independent government agency.


    104. Describe the due process followed by the standard-setting body. Please include explanations of the following:
    1. public exposure of standards



    2. accessibility of meetings (i.e., public or private)



    3. approval process for final standards (i.e., majority required to approve final standards)



    4. other relevant due process activities

      With respect to question 105, there are no separate standard-setting meetings.


    105. Approximately how many days per year does the standard-setting body meet in full session (including teleconferences)?
      Day(s)


    Section 9B -- Standard-Setting (Financial Accounting Standards Board (FASB))


    95. For Financial Accounting Standards Board (FASB), please indicate the nature of the body (i.e., whether it is part of a government ministry or department, an agency appointed by government, a private organization established by the profession, or other [please describe]) and the name of the standards.
      a. Nature of body



      b. Name of standards



    96. How many voting members does the standard-setting body have?
      FASB - 7 members, Emerging Issues Task Force (EITF) - 14 including nonvoting Chair.


    97. Are the members of the standard-setting body involved on a voluntary basis or employed by the standard-setting body?
      Voluntary  
      Employed  
      Both - Please describe: FASB-employed. EITF: The Chairman is employed; 13 members are volunteers.


    98. What are the criteria considered in selecting members of the standard-setting body (e.g., best person for the job, sector of the profession, private and public members, academic, geographical representation, etc.)?


    99. Who appoints these members (e.g., member body, government, user, regulator, etc.)?
      FASB: Members are appointed by the Financial Accounting Foundation (a private-sector foundation).

      Note to questions 100 and 101: FASB members are appointed for a 5 year term, renewable for one additional term (maximum 10 years). FASB has been in existence for 32 years. EITF members are not appointed for specific terms. The EITF has been in existence for 20 years.


    100. What is the term of appointment for members?
      5 Year(s)


    101. For how many years has the standard-setting body been in existence?
      32 Year(s)


    102. Please indicate the budget in US$ of the standard-setting body for the last fiscal year:
      Note: Please enter a whole number using commas (e.g., 4,000,000)

      25,000,000

      Please enter the exchange rate used to calculate this number.

      Note: Please enter a decimal amount (e.g., 4.0027)

      1.0000



    103. To what entity is the standard-setting body accountable?


    104. Describe the due process followed by the standard-setting body. Please include explanations of the following:
    1. public exposure of standards



    2. accessibility of meetings (i.e., public or private)



    3. approval process for final standards (i.e., majority required to approve final standards)



    4. other relevant due process activities

      Note to question 105: FASB generally meets weekly (about 48 days a year).


    105. Approximately how many days per year does the standard-setting body meet in full session (including teleconferences)?
      48 Day(s)


    Section 9B -- Standard-Setting (AICPA Accounting Standards Executive Committee (AcSEC))


    95. For AICPA Accounting Standards Executive Committee (AcSEC), please indicate the nature of the body (i.e., whether it is part of a government ministry or department, an agency appointed by government, a private organization established by the profession, or other [please describe]) and the name of the standards.
      a. Nature of body

      Private organization

      b. Name of standards

      Statements of Position, Audit and Accounting Guides, Practice Bulletins


    96. How many voting members does the standard-setting body have?
      14


    97. Are the members of the standard-setting body involved on a voluntary basis or employed by the standard-setting body?
      Voluntary  
      Employed  
      Both - Please describe:


    98. What are the criteria considered in selecting members of the standard-setting body (e.g., best person for the job, sector of the profession, private and public members, academic, geographical representation, etc.)?
      AcSEC: The current composition of AcSEC is eight members from public accounting, four from the preparer community, one user, and one academician. The policy is to maintain approximately that composition as vacancies are filled. Factors in selecting individuals as members of AcSEC include: best person for the job, including expertise in specialized areas, size of firm, and geographical representation.


    99. Who appoints these members (e.g., member body, government, user, regulator, etc.)?
      AcSEC: Members are appointed by the Chairman of the Board of the AICPA.

      With respect to question 100:
      AcSEC: 1 year, renewable for 2 additional years. If appointed Chairman, an AcSEC member may serve an additional 3 years.


    100. What is the term of appointment for members?
      1 Year(s)


    101. For how many years has the standard-setting body been in existence?
      32 Year(s)


    102. Please indicate the budget in US$ of the standard-setting body for the last fiscal year:
      Note: Please enter a whole number using commas (e.g., 4,000,000)

      1.300.000

      Please enter the exchange rate used to calculate this number.

      Note: Please enter a decimal amount (e.g., 4.0027)

      1.000



    103. To what entity is the standard-setting body accountable?


    104. Describe the due process followed by the standard-setting body. Please include explanations of the following:
    1. public exposure of standards



    2. accessibility of meetings (i.e., public or private)

      See 104a above.

    3. approval process for final standards (i.e., majority required to approve final standards)



    4. other relevant due process activities



    105. Approximately how many days per year does the standard-setting body meet in full session (including teleconferences)?
      16 Day(s)



    Section 10 -- Monitoring (Quality Assurance) and Enforcement


    Responses to the questions in this section will provide a description of the legal and professional framework governing regulation of the profession in your country. Please indicate what role your organization plays within this framework.

    Section 10A -- Securities Market Regulatory Authority


    106. Name the authority that regulates the securities market:
      The Securities and Exchange Commission (SEC)


    107. What responsibilities does this organization have for monitoring and enforcing compliance with accounting, reporting or auditing requirements? Please identify the Legal authority that establishes that responsibility:


    108. Briefly describe the role of the regulatory authority as it relates to the following:
    1. regulation of the audit profession



    2. accounting and auditing standard-setting



    3. review of financial statements prepared by listed entities, and monitoring of their compliance with the accounting and disclosure requirements





    Section 10B -- Stock Exchange


    109. Name the four largest stock exchangers (by market capitalization) and whether it is organized as a profit or not-for-profit organization:
      Profit Not
      for
      profit
      Stock Exchange
      NYSE
      NASDAQ Stock Market
      American Stock Exchange
      Nine smaller regional stock exchanges



    Section 10B -- Stock Exchange
    NYSE Details


    110. For NYSE, is there a mechanism at the stock exchange(s) for monitoring and enforcing financial reporting, accounting and auditing of listed entities?
      Yes   No

      If YES, please describe the following:

    1. How the monitoring and enforcement of financial reporting, accounting and auditing is conducted.

      The stock exchanges examine their members for the purpose of evaluating the soundness of their financial condition and the extent of their compliance with stock exchange rules and pertinent securities laws and regulations. This is accomplished by, among other things, a review and analysis of financial statements filed by members. Annual audited reports are also reviewed. The purpose of the review is not to monitor or enforce the conduct of financial reporting, accounting or auditing.

    2. The consequences of non-compliance with the financial reporting, accounting or auditing requirements.



    3. How enforcement actions are administered.



    Section 10B -- Stock Exchange
    NASDAQ Stock Market Details


    110. For NASDAQ Stock Market, is there a mechanism at the stock exchange(s) for monitoring and enforcing financial reporting, accounting and auditing of listed entities?
      Yes   No

      If YES, please describe the following:

    1. How the monitoring and enforcement of financial reporting, accounting and auditing is conducted.

      The stock exchanges examine their members for the purpose of evaluating the soundness of their financial condition and the extent of their compliance with stock exchange rules and pertinent securities laws and regulations. This is accomplished by, among other things, a review and analysis of financial statements filed by members. Annual audited reports are also reviewed. The purpose of the review is not to monitor or enforce the conduct of financial reporting, accounting or auditing.

    2. The consequences of non-compliance with the financial reporting, accounting or auditing requirements.



    3. How enforcement actions are administered.



    Section 10B -- Stock Exchange
    American Stock Exchange Details


    110. For American Stock Exchange, is there a mechanism at the stock exchange(s) for monitoring and enforcing financial reporting, accounting and auditing of listed entities?
      Yes   No

      If YES, please describe the following:

    1. How the monitoring and enforcement of financial reporting, accounting and auditing is conducted.

      The stock exchanges examine their members for the purpose of evaluating the soundness of their financial condition and the extent of their compliance with stock exchange rules and pertinent securities laws and regulations. This is accomplished by, among other things, a review and analysis of financial statements filed by members. Annual audited reports are also reviewed. The purpose of the review is not to monitor or enforce the conduct of financial reporting, accounting or auditing.

    2. The consequences of non-compliance with the financial reporting, accounting or auditing requirements.



    3. How enforcement actions are administered.



    Section 10B -- Stock Exchange
    Nine smaller regional stock exchanges Details


    110. For Nine smaller regional stock exchanges, is there a mechanism at the stock exchange(s) for monitoring and enforcing financial reporting, accounting and auditing of listed entities?
      Yes   No

      If YES, please describe the following:

    1. How the monitoring and enforcement of financial reporting, accounting and auditing is conducted.

      Nine smaller regional stock exchanges operate in Boston, Cincinnati, Chicago, Los Angeles, Miami, Philadelphia, Salt Lake City, San Francisco, and Spokane (some are profit and some are not-for-profit).

    2. The consequences of non-compliance with the financial reporting, accounting or auditing requirements.



    3. How enforcement actions are administered.




    Section 10C -- Regulatory Oversight of the Accounting Profession


    111. Has an audit profession oversight body been established (e.g., to oversee the external quality assurance review process, etc.)?
      Yes   No

      If NO, proceed to the next section.

      If YES, please describe :

    1. What are the name and duties of the oversight body?

      Refer to the PCAOB.

    2. The number of members on the oversight body

      Refer to the PCAOB.

    3. Its powers

      Refer to the PCAOB.

    4. How the oversight body conducts or oversees a program of inspections to assess the degree of compliance of each audit firm/auditor with applicable auditing standards and regulations

      Refer to the PCAOB.

    5. The sanctions the oversight body may impose in the event of non-compliance

      Refer to the PCAOB.

    6. How the oversight body is accountable to any public institution or body

      Refer to the PCAOB.


    Section 10D -- Banks Regulatory Authority


    112. Name the authority that regulates the banks and similar financial institutions. Discuss how this authority differentiates between accounting requirements for regulatory reporting and general purpose external financial reporting:
      There are four agencies responsible for regulating banks and savings institutions in the U.S. system. The Federal Reserve is responsible for regulation of state member institutions, the Federal Deposit Insurance Corporation is responsible for regulating state non-member(not members of the Federal Reserve System) banks, the Comptroller of the Currency is responsible for regulating national banks and the Office of Thrift Supervision regulates savings institutions. Credit Unions are regulated by the National Credit Union Association. The Federal Deposit Insurance Corporation also regulates the deposit insurance system. The agencies state that regulatory reporting is now to be in accordance with generally accepted accounting principles that are also used for general purpose external financial reporting. In general, this is true although in some cases the regulators limit the alternatives that may exist under generally accepted accounting principles.


    113. Discuss briefly the legal requirements with respect to monitoring and enforcement by the regulatory authority of accounting and auditing standards that apply to the banks and similar financial institutions:
      The primary legislation impacting the regulatory authority of accounting and auditing standards that apply to the banks and similar financial institutions can by found in the Federal Deposit Insurance Act and the Federal Deposit Improvement Act of 1991(FDICIA). These statutes provide for periodic regulatory examinations of these depository institutions. FDICIA requires all banks and thrifts with assets of $500 million or more to have an annual audit of their financial statements including an audit of internal control over financial reporting. The audit must be performed by an independent accountant meeting certain specific qualifications. Institutions less than $500 million are encouraged but not required to have an annual audit.


    114. Briefly describe the role of the regulatory authority as it relates to the following:
    1. regulation of the audit profession

      Audit reports received by the regulators in compliance with the reporting requirements of FDICIA are reviewed by the primary regulators and in some cases the regulators may ask to examine the work papers. The regulators can either refer problems to the AICPA or the state boards of accountancy or if the deficiencies meet certain criteria they may take enforcement action against the auditor.

    2. accounting and auditing standard-setting

      The regulators agencies provide input during the exposure process to the standard setting bodies for accounting and auditing. In addition, the AICPA has established a Depository Institutions Expert Panel that meets with the representatives of the various agencies on a quarterly basis to discuss accounting, auditing and regulatory issues.

    3. review of financial statements prepared by listed entities

      Under legislative authority, the regulators have the responsibility of reviewing the filings of all listed financial institutions under their authority. The regulatory agencies require these institutions to follow the same SEC guidelines and regulations as other listed entities.

    4. enforcement of accounting, reporting and auditing requirements

      Please see response to 114a.



    Section 10E -- Non-Banking Financial Institutions Regulatory Authority


    115. Name the regulatory authority(ies) responsible for monitoring compliance with and enforcing accounting, reporting and auditing requirements imposed on non-banking institutions.


    116. What is the source of Legal authority of the regulatory authority(ies)?


    117. Briefly describe the role of the regulatory authority(ies) as it relates to the following:
    1. regulation of the audit profession



    2. accounting and auditing standard-setting



    3. review of financial statements prepared by listed entities



    4. enforcement of accounting, reporting and auditing requirements




    Section 10F -- Insurance Companies Regulatory Authority


    118. Name the regulatory authority responsible for monitoring compliance with and enforcing accounting, reporting and auditing requirements imposed on insurance companies.
      Each of the 54 jurisdictins has an insurance regulator. The National Association of Insurance Commissioners (NAIC) is the organization of insurance regulators from the 50 states, the District of Columbia and the four U.S. territories. The NAIC provides a forum for the development of uniform policy when uniformity is appropriate. The NAIC's primary instruments of public policy are model laws, regulations and guidelines. Insurance departments regulate a national business on a state-by-state basis. The states may either adopt the models intact or modify them to meet their specific needs and conditions. Some of the models have been deemed essential for effective solvency regulation. Such models, or laws that are substantially equivalent, are required of those states seeking formal NAIC accreditation.


    119. What is the source of Legal authority of the regulatory authority(ies)?
      The authority of each state insurance regulator is established in state law.


    120. Briefly describe the role of the regulatory authority(ies) as it relates to the following
    1. regulation of the audit profession

      The regulatory authorities do not regulate the auditing profession. The NAIC has a model regulation requiring annual audited financial reprots from insurance companies.

    2. accounting and auditing standard-setting

      ACCOUNTING: Statutory accounting refers to the accounting required of insurers reporting to insurance regulatory authorities. Statutory accounting principles and practices are primarily detailed in the NAIC Accounting Practices and Procedures Manual (AP&P Manual), although each insurerís state of domicile may allow or require an insurer to utilize an alternative accounting principle or practice (known as a permitted or prescribed practice, respectively). Other sources of statutory accounting guidance exist, and these are organized into a hierarchy that is detailed in the Preamble of the AP&P Manual. Statutory Accounting Principles (SAP) objectives differ from Generally Accepted Accounting Principles (GAAP) objectives. Whereas GAAP stresses matching revenue to expenses, SAP stresses measuring the ability of an insurer to pay claims in the future. The maintenance of SAP is accomplished through two working groups that report to the Accounting Practices and Procedures (E) Task Force: the Statutory Accounting Principles Working Group (SAPWG) and the Emerging Accounting Issues Working Group (EAIWG). The SAPWG has the exclusive responsibility for developing and proposing new Statements of Statutory Accounting Principles (SSAPs). The EAIWG responds to questions of application, interpretation and clarification that are generally much narrower in scope than development of a new SSAP. The NAICís International Accounting Standards Working Group originated in 2000 to monitor international insurance activity, primarily with the International Accounting Standards Board (IASB) and the International Association of Insurance Supervisors (IAIS) Accounting Subcommittee. It is the goal of the IASWG to stay abreast of current international issues, keep members informed of international activities, and to provide comments to international standard setters representative of the accounting principles of the NAIC. AUDITING The regulatory authorities do not set auditing standards.

    3. review of financial statements prepared by listed listed entities

      Each of the state insurance regulators may review the financial statements prepared for listed entities. The NAIC has a Financial Analysis Unit. The mission of the Financial Analysis Unit is to assist insurance regulators in achieving their objective of identifying, at the earliest possible stage, insurance companies that may be financially troubled. In pursuit of this mission, the Unit performs financial analysis of insurance companies under the direction of the Financial Analysis Working Group (FAWG). The FAWG was formed by the Examination Oversight (E) Task Force to identify insurance companies of national significance (NATSIG), which are, or may be, financially troubled, and to determine whether appropriate regulatory action is being taken. This peer review process has become a fundamental and essential part of the NAIC's Solvency Agenda. In addition the staff maintains and enhances the functionality of NAIC solvency monitoring tools.

    4. enforcement of accounting, reporting and auditing requirements




    Section 10G -- Other Regulatory Authority


    121. Name any other regulatory authority(ies) responsible for monitoring compliance with and enforcing accounting, reporting and auditing requirements.


    122. What is the source of Legal authority of each regulatory authority?


    123. Briefly describe the role of the regulatory authority(ies) as it relates to the following
    1. regulation of the audit profession



    2. accounting and auditing standard-setting



    3. review of financial statements prepared by listed listed entities



    4. enforcement of accounting, reporting and auditing requirements




    Section 10H -- Quality Assurance


    124. Does any organization of professional accountants/auditors organize a program of quality assurance review to monitor compliance with accounting, reporting and auditing requirements?
      Yes   No

      If NO, proceed to next Section.

      If YES, briefly describe the monitoring and enforcement mechanism.



    125. Under what authority does the organization conduct the program of quality assurance review?
      AICPA Board of Directors is authorized to establish peer review divisions governed by executive committees having senior status with authority to carry out peer review activities.


    126. Who performs the review (e.g., one firm reviewing another firm, staff from the national professional organization, contractors, or a combination of these)?
      One firm peer reviews another firm in both AICPA practice-monitoring programs.



    Section 10 I -- Investigation and Discipline


    127. Is there a process for investigating and disciplining the accounting profession in your country?

    128. Which of the following best describes the responsibility for the investigatory and disciplinary function in your country?
      Government or other agencies are solely responsible for this function.
      Government or other agencies have this responsibility, but the member body or bodies participate in the process.
      Government formally delegates this function to the member body or bodies, to exercise on its behalf.
      Member body or bodies have separate and independent processes that operate alongside processes of legal authorities.
      Other (please explain)


    129. Please indicate the name of the body or bodies responsible for investigation and discipline.
      AICPA, State Boards of Accountancy, PCAOB, SEC, Certain State and Local Government agencies with jurisdiction over the engagement.


    Responses to the remaining questions in this Section are required if your organization has responsibility for investigation and disciplinary actions.

    130. How many voting members does the body have?


    131. Are the members of the body involved on a voluntary basis or employed by the standard-setting body?
      Voluntary  
      Employed  
      Both - Please describe: The PEEC is comprised of 20 members. Seventeen members are CPA volunteers, while 3 members are form the public (non PCAs) and compensated by the AICPA. The State Boards will vary. The members of the PCAOB and SEC are employed.


    132. What are the criteria considered in selecting members of the body (e.g., best person for the job, sector of the profession, private and public members, academic, geographical representation, etc.)?
      Members of the PEEC are appointed so that there is representation from public practice (including small, medium, and large firms), business and industry, govt, educators, state regulators and the public. Relevant experience with respect to ethics and independence is sought.

      From the Sarbanes-Oxley Act of 2002: PCAOB members are appointed from among prominent individuals of integrity and reputation who have a demonstrated commitment to the interests of investors and the public, and an understanding of the responsibilities for and nature of the financial disclosures required of issuers under the securities laws and the obligations of accountants with respect to the preparation and issuance of audit reports with respect to such disclosures. Two members, and only 2 members, of the Board shall be or have been CPAs, provided that, if 1 of those 2 members I the chairperson, he or she may not have been a practicing CPA for at least 5 years prior to his or her appointment to the Board.

      With respect to question 133:

      The Director of the AICPA Professional Ethics Division, in consultation with the PEEC Chair, nominates the members of the PEEC. The AICPA Board of Directors approves nominations for members of the PEEC.


      From the Sarbanes-Oxley Act of 2002: Members of the PCAOB are appointed by the Securities and Exchange Commission, after consultation with the Chairman of the Board of Governors of the Federal Reserve System and the Secretary of the Treasury.



    133. Who appoints these members (e.g., member body, government, user, regulator, etc.)?
      See response in question 132.


    134. What is the term of appointment for members?
      Year(s)


    135. For how many years has the body been in existence?
      Year(s)


    136. Please indicate the budget in US$ of the body for the last fiscal year.
      Note: Please enter a whole number using commas (e.g., 4,000,000)

      Please enter the exchange rate used to calculate this number.

      Note: Please enter a decimal amount (e.g., 4.0027)

      (specify currency)



    137. To what entity is the body accountable?
      The PEEC is the senior technical committee of the AICPA designated to interpret the AICPA Code of Professional Conduct, make amendments to the Code and enforce the rules of conduct. Ultimately, the PEEC is accountable to the AICPA Council.


      From the Sarbanes-Oxley Act of 1001: The PCOAB shall submit an annual report (including its audited financial statements) to the Securities and Exchange Commission, and the Commission shall transmit a copy of that report to the Committee on Banking, Housing, and Urban Affairs of the Senate, and the Committee on Financial Services of the House of Representatives.



    138. Approximately how many days per year does the body meet in full session (including teleconferences)?
      Day(s)



     

     

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