Certified Practising Accountants Papua New Guinea

Under the Accountants Act of 1996, the Accountants Registration Board (ARB) is responsible for establishing and operating a mandatory quality assurance (QA) review system for all audits of financial statements in PNG. As revisions to the Accountants Act are still pending parliament approval, the ARB’s functions have been amended and will be official when the Act is passed, whereby the operations and running of the ARB will be led by CPAPNG and its leadership. This function is already being undertaken by CPAPNG. Once the Act is passed, official steps will be taken by CPAPNG, with the support of an external resource to support the development of the QA review system. As of May 2024, no QA review system exists.

Although CPAPNG has no responsibility for conducting QA reviews, the institute has utilized its best endeavors to support the ARB and the government of PNG to revise the Accountants Act, which is awaiting approval by Parliament, to create the necessary provisions for the ARB and CPAPNG to perform QA reviews. The CPAPNG indicates that once the new Act is approved, it will develop a quality review program to be implemented in PNG. At this time, no further action can be taken until the Act is approved.

To develop the future system, CPAPNG reports that it continues to learn about implementing a QA system. These efforts have included attending events hosted by CAPA; holding discussions with PAOs from the neighboring Pacific Islands (Fiji, Samoa, and Solomon Islands) to draft a Memorandum of Understanding to facilitate knowledge sharing around QA and other accountancy related matters; and holding discussions with a QA reviewer from the Fiji Institute of Chartered Accountants (FICA) to assist CPAPNG in establishing a QA system for Papua New Guinea. FICA is responsible for QA reviews in Fiji and has incorporated all SMO 1 requirements in its system and therefore represents an appropriate regional partner to learn from.

CPAPNG reports that it has completed its discussions with FICA and has put forward recommendations for the future QA review system. Once a draft procedure is approved, CPAPNG will initiate an awareness campaign to promote ISQM 1 and the principles of the draft QA system to members and other stakeholders. ICAI India will also provide assistance to CPAPNG with QA.

As there are reported ongoing initiatives around the future implementation of a QA system in the jurisdiction, CPAPNG is encouraged to continue its efforts and to keep IFAC updated on progress made. In addition, CPAPNG is encouraged to continue promoting the approval of the revised Accountants Act so further progress can be made to improve the quality of the profession in the jurisdiction.

Current Status: Execute

In Papua New Guinea, CPAPNG is responsible for setting initial professional development (IPD) and continuing professional development (CPD) requirements. CPAPNG reports that its curriculum and syllabus are mostly, but not fully, in line with the IES. In 2019, CPAPNG conducted a comparison against the IES and identified gaps in IES 3 and 6. CPAPNG also reports that it has plans to engage with an external consultant to further develop its educational offerings and close the gaps as identified.

CPAPNG is very active in providing CPD and training opportunities to its members. To maintain the quality of its IPD programming, the CPAPNG has an MOU with the UK-based BPP Learning Media to develop four of CPAPNG’s Certified Accounting Technician program books. A recent development with BPP Learning Media is to produce computer-based program and courses. It also has a MOU with CPA Australia to incorporate five of CPA Australia’s exam modules into the CPAPNG CPA syllabus while retaining its own PNG-specific tax and law modules. All CPA and CAT courses are digital. This was also in part to manage risks with program shortages in resources and other external factors that could disrupt learning for students. CPAPNG has also signed an MOU with ICAI India to provide further support to CPAPNG.

CPAPNG continues to actively engage with local universities to improve areas of syllabus coverage and delivery with the objective of maintaining a comprehensive accounting education program and syllabus to ensure that all accountancy education standards in PNG are in line with IES requirements.

CPAPNG administers CPD courses for its members, who must complete 120 hours of CPD over three years. The CPAPNG continues to review its members’ CPD needs and indicates that ongoing improvements are being made to deliver the training.

CPAPNG is encouraged to ensure that while legislation is pending approval, it continues in its plans to close the gaps identified and keep IFAC staff update on efforts that it has set out to do.

Current Status: Execute

The Accounting Standards Board is responsible under the Companies Act of 1997 to set and approve national auditing standards. The Accountants Act of 1996 also gives CPAPNG the authority to establish auditing standards. However, the Accountants Act is being revised to address these conflicting mandates. Pending its approval, the new Accountants Act will withdraw CPAPNG’s responsibility for setting auditing standards.

As the ASB is unable to convene on a regular basis, CPAPNG continues to proactively adopt applicable audit standards in Papua New Guinea. As of May 2024, the latest ISA by IAASB is adopted in Papua New Guinea. CPAPNG supports its members with the implementation of auditing standards by keeping them informed about new and revised IAASB pronouncements through relevant continuing professional development courses. This also includes offering CPD training and events around the standards. It has developed applicable tools for its members to support them in their professional activities.

Current Status: Sustain

Under the Accountants Act of 1996, both the Certified Practising Accountants of Papua New Guinea (CPAPNG) and the Accountants Registration Board are responsible for establishing ethical requirements in Papua New Guinea and require professional accountants to adhere to CPAPNG’s Code of Ethics. CPAPNG reports that the latest International Code of Ethics for Professional Accountants by IESBA is adopted when issued. CPAPNG supports its members’ knowledge of, and compliance with ethical requirements by organizing various continuing professional development (CPD) workshops and conferences that include sessions on ethics and professional responsibility. CPAPNG continues to offer CPD and is proactive in raising awareness on ethical requirements. New members and candidates are introduced to ethical requirements in pre-qualification examinations and modules entitled “Ethics and Governance” based on the CPA Australia module. New members are also given a copy of the Code of Ethics when they join the institute.

Current Status: Sustain

With no responsibility for adopting public sector accounting standards, the CPAPNG indicates it is actively liaising with the government to adopt accrual-basis IPSAS and encouraging public sector accountants to be members of CPAPNG for technical support. CPAPNG continues to administer continuing professional development (CPD) courses and programs to public sector accountants in the jurisdiction and CPAPNG reports that it had previously engaged with a public sector accounting specialist to develop specialized CPD programs on public sector financial management. In addition, CPAPNG has collaborated with the Chartered Institute of Public Finance and Accountancy to raise awareness on benefits of IPSAS adoption, and as part of its efforts to promote sound public financial management reform with regional partners, the President of CPAPNG is involved as a Board Member of CAPA and has been active in CAPA’s public sector activities. Work with CAPA has also includes the Pacific Association of Supreme Audit Institutions to invite representatives of PAOs to meetings, which has also allowed CPAPNG to collaborate with its Auditor General’s office.

In addition, other important efforts by CPAPNG include liaising with the local government such as the Finance Department and Auditor General's office to raise awareness and promote the strengthening of public sector financial management even though the local government of PNG is resistant to initiate reforms. CPAPNG reports it has convened a Public Sector Finance Management Conference in the jurisdiction to continue its advocacy for public financial management reform within the jurisdiction, the Pacific Islands, and the region.

Current Status: Sustain

Under the Accountants Act of 1996, the Accountant Statutory Committee (ASC) which operates under the Accountants Registration Board (ARB) and the CPAPNG share responsibility for the establishment of an investigative and disciplinary (I&D) system for professional accountants in PNG.

As revisions to the Accountants Act are still pending parliament approval, the ARB’s functions have been amended and will be official when the Act is passed, whereby the operations and running of the ARB will be led by CPAPNG and its leadership.

The CPAPNG is responsible for an I&D review system applicable to the conduct of members that are non-auditors with the ASC approving the recommended sanctions while the ARB is responsible for an I&D system for auditors. Revisions to the Accountants Act, which are pending approval will clarify the respective I&D functions of the ARB and CPAPNG. The CPAPNG reports that its system incorporates most SMO 6 best practices with gaps in linkages to a quality assurance review system (which does not exist in the jurisdiction) and a separate body for appeals. CPAPNG is undertaking separate efforts to reduce the gaps that have been identified.

CPAPNG performs ARB activities including registration. However, CPAPNG does not make decisions on behalf of the ARB with regards to disciplinary actions. This is to make the line clear between the responsibilities of ARB and CPAPNG to not interfere in any applicable legal proceedings. However, all investigative work is conducted by CPAPNG. The ASC, which is a subcommittee of the ARB still approves the recommendations, which is then sent to the ARB.

Complaints can be made directly to CPAPNG or its Council. CPAPNG’s Membership, Ethics and Disciplinary Committee (Disciplinary Committee), which consists of individuals from the accountancy profession, academia, and law, is responsible for recommending ethical and disciplinary cases to the ASC. The ASC reportedly does not meet on a regular basis and therefore has not undertaken any investigative or disciplinary actions. Since the establishment of its current I&D system, CPAPNG reports that since 2020, it has conducted three investigations.

The CPAPNG indicates that the revised Accountants Act will also include provisions that will help align CPAPNG’s I&D system with the best practices of SMO 6 and will impose tougher penalties on individuals who do not comply with ethical requirements and relevant rules. As part of the implementation of its five-year strategic plan (2020–2025), CPAPNG indicates that it has developed a whistleblower process and protection policy and has incorporated this into the existing I&D system. CPAPNG reports that it uses its best efforts to ensure members uphold their ethical obligations and professional conduct. CPD is continuously offered to members on the I&D process, the IESBA Code and the institute provides its Code of Ethics to new members upon registration. Once the whistleblower process is in place, CPAPNG will carry out a public-awareness campaign about its I&D system.

CPAPNG is encouraged to continue promoting the approval of the revised Accountants Act so further progress can be made to improve the quality of the profession in the jurisdiction.

Current Status: Execute

The Accounting Standards Board (ASB) has the responsibility under the Companies Act of 1997 to set and approve private sector accounting standards. The Certified Practising Accountants of Papua New Guinea (CPAPNG) reports that the latest International Financial Reporting Standards (IFRS) as well as IFRS for Small- and Medium-Sized Entities (IFRS for SMEs) are adopted in Papua New Guinea. CPAPNG reports it has actively promoted the adoption of IFRS in the jurisdiction. This has included CPAPNG being represented on the ASB and being a strong advocate that the ASB meet to fulfill its legislated responsibilities.

The institute supports IFRS implementation through the pre- and post-qualification education and training that it provides to members. For instance, the institute includes IFRS in its examinations and distributes handbooks amongst students, candidates, and members. The CPAPNG includes IFRS in its continuing professional development program and has collaborated with various key accounting firms in the jurisdiction to organize training seminars and workshops for members. The CPAPNG has previously organized workshops in two of the biggest cities in PNG to publicize changes to IFRS. CPAPNG also issues technical bulletins as part of its dissemination activities.

Current Status: Sustain