Lesotho Institute of Accountants
Member | Established: 1977 | Member since 1985
The Lesotho Institute of Accountants (LIA) was established in 1977 in accordance with the Accountants Act 1977 with a mandate to regulate the accountancy profession in Lesotho. Its membership comprises Charted Accountants, General (Registered) Accountants, and Technicians (Licensed Accountants). Under the Companies Act 2011, all statutory auditors must be LIA members.
Statements of Membership Obligations (SMOs)
The Statements of Membership Obligations form the basis of the IFAC Member Compliance Program. They serve as a framework for credible and high-quality professional accountancy organizations focused on serving the public interest by adopting, or otherwise incorporating, and supporting implementation of international standards and maintaining adequate enforcement mechanisms to ensure the professional behavior of their individual members.
Although LIA is not legally responsible for the implementation of a quality assurance (QA) system, it established a QA system for public interest entities and contributed to the revision of the Accountants Act 1977 that introduces a mandatory a QA system. Due to capacity restraints in the past, LIA had contracted the Association of Chartered Certified Accountants to conduct practice reviews of practitioners who audit public interest entities. However, this contract expired in December 2014 and LIA is now in the process of establishing a partnership with the Public Accountants and Auditors Board in Zimbabwe to provide technical training for conducting QA reviews. As part of these efforts, the institute has hired technical staff to conduct the reviews and legal staff to supervise compliance and disciplinary matters that arise from QA reviews. Additionally, LIA has established a Compliance Committee that oversees the review process and members’ implementation of review findings.
To support its members, LIA provides updates to reviewed firms on the QA review findings, and holds annual seminars on ISA and ISQC 1, as well as workshops on SMO 1. LIA also disseminates information on the QA review process via its quarterly newsletter.
In its next Action Plan update, LIA is encouraged to provide an update on the adoption of the Accountants Act 1977 that would include a mandate to have a QA review system. LIA is also encouraged to provide an update on its partnership with the Public Accountants and Auditors Board in Zimbabwe and indicate if QA reviews have commenced again.
LIA shares responsibility for the education and training of the accountancy profession with the Council of Higher Education, which oversees the syllabi and curricula of universities.
In collaboration with the Association of Chartered Certified Accountants, LIA operates a joint qualification scheme to enhance alignment with IES. The institute also encourages the Council of Higher Education and education providers (such as the National University of Lesotho) to recognize and implement IES. LIA reports that it met with the National University of Lesotho in February 2016 to help raise awareness of the IES.
To strengthen its practical experience component, LIA is actively working with employers to ensure that candidates have access to appropriate practical experience. The institute has also secured funding from international donors (the World Bank and European Union) for the implementation of a new local accountancy qualifications program offering both private and public sector accounting, fraud and forensic investigation, and advanced tax planning competencies. The institute is beginning its pilot phase of the Lesotho Professional Accountancy Program (LePAP) in July 2016 to bring public sector accounting into the accountancy profession.
Additionally, LIA hosts workshops and seminars to assist members in keeping abreast of updates to educational requirements and to fulfill their continuing professional development (CPD) requirements. LIA monitors compliance with CPD requirements, informs members of CPD requirements via its newsletter, meetings, and workshops, and includes a CPD calendar of events on its website.
LIA is encouraged to provide an update in its Action Plan on the status of the LePAP program. LIA is could also consider providing an update on the Council of Higher Education and its incorporation of revised IES requirements into its curricula. The institute is also encouraged to consider participating in the international standard-setting process by providing comments on Exposure Drafts and other pronouncements issued by the IAESB.
LIA is directly responsible for the adoption of ISA and, having adopted ISA, focuses on supporting the implementation of the standards. It does this by providing education and training on the standards for its members. The institute organizes and delivers seminars and workshops on changes to the standards, and also publishes articles on ISA in its quarterly newsletter.
LIA states that it participates in the international standard-setting process by providing comments on IAASB Exposure Drafts.
The institute is also encouraged to promote the inclusion of the standards in the initial professional development curricula and syllabi of tertiary education providers.
LIA has direct responsibility for the adoption of a Code of Ethics and, accordingly, has established processes to adopt the IESBA Code of Ethics on an ongoing basis. The institute also focuses on supporting compliance with the Code by offering pertinent training to members. LIA states that it identifies challenging ethical areas and develops discussion forums on those topics, subsequently conducting a workshop if necessary. LIA also supports compliance through its monitoring activities.
LIA keeps members informed by sharing amendments issued by the IESBA in membership meetings and via emails and has circulated an Exposure Draft of the 2015 Code of Ethics to prepare members for the adoption of that Code. LIA delivers training on ethics and regulatory requirements, and raises member awareness by periodically publishing legal, ethical, and regulatory requirements. The institute intends to revise and amend the professional rules of conduct to incorporate emerging ethical issues.
LIA is encouraged to ensure that initial professional development programs in the jurisdiction incorporate ethical standards and related topics on an ongoing basis.
LIA has direct responsibility for the adoption of public sector standards and has adopted IPSAS in their entirety. It is now actively working to support the government in its application and implementation of IPSAS. The institute meets with the Accountant General, Auditor General and officials from the Ministry of Finance to raise awareness of, and promote, IPSAS implementation. LIA is proactive in fostering relationships with accountants in the public sector, and is in the pilot phase of its Lesotho Professional Accountancy Program, which is meant to provide a path to the Chartered Accountancy qualification for public sector officials and bring the public sector accounting cadre into the accountancy profession.
In addition, LIA indicates in its Action Plan that it plans on increasing its participation in the standard-setting process by submitting comments on IPSASB Exposure Drafts.
LIA is encouraged to disseminate pronouncements issued by the IPSASB to its members, public sector accountants, and key stakeholders via electronic mechanisms and other periodic publications. Also, the institute may consider hosting seminars and workshops to raise awareness of IPSAS.
LIA, with direct responsibility for the investigative and disciplinary (I&D) system for members of the profession, has established I&D mechanisms that will be in line with the revised SMO 6 requirements pending Council and general membership approval in April 2016. LIA has developed a Risk Register to maintain records of complaints, cases, and follow-up on investigations. In 2015, the institute received four complaints, and three of them are still pending hearings with the Disciplinary Committee. LIA has also developed a Disciplinary Procedures Manual that serves as guide for the entire disciplinary process.
The institute raises both member and public awareness of the I&D requirements. LIA reports that it is developing clearer channels for the public to make a complaint. In its annual report, LIA includes a section on the disciplinary actions that have been taken throughout the year.
In its next Action Plan update, LIA is encouraged to report if the revised disciplinary procedures have been approved and are in place.
LIA, with direct responsibility for the adoption of private sector accounting standards, has adopted IFRS and IFRS for SMEs on an ongoing basis. The institute continuously monitors and reviews IASB pronouncements. It states that it participates in the international standard-setting process by providing comments on IASB Exposure Drafts.
In addition to sharing updates and revisions to the standards with its members via its website and internal notice board, LIA supports implementation of the standards by regularly conducting training on the standards, and including IFRS in its continuing professional development events. In 2015, LIA hosted a seminar on IFRS for its members. LIA reports that it intends to publish articles on changes to the standards in a quarterly newsletter and monitor application of IFRS through inspections.
LIA is encouraged to promote the inclusion of IFRS-related topics in the pre-qualification programs offered by universities.
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