Newsletters & eNews
Oct 26, 2010
In This Issue:
News on the Future of the Accountancy Profession
- IFAC Consultation Paper Highlights Changing Roles and Employer Expectations of Professional Accountants in Business
- Competent and Versatile: Q&A for Smaller Organizations and the Accountants That Serve Them
- IFAC-UNCTAD Conference: Preventing the Next Financial Crisis and the Role of Accountants in Corporate Governance
- Business Reporting Project: Recommendations from the Investment Community
- Links to Relevant Resources
Other PAIB Committee Developments
- Enhanced International Center for Professional Accountants in Business
- IFAC 2010-2012 Strategy and Work Plan to Serve Professional Accountants in Business
News on the Future of the Accountancy Profession
1) IFAC Consultation Paper Highlights Changing Roles and Employer Expectations of Professional Accountants in Business
The Professional Accountants in Business Committee recently released for comment a Consultation Paper, Competent and Versatile: How Professional Accountants in Business Drive Sustainable Organizational Success, that highlights how employer expectations of professional accountants in business are expected to change in light of global trends and evolving organizational needs.
The paper analyzes these expectations in relation to eight drivers of sustainable organizational success--what companies need to do to achieve and sustain success in the changing global economic landscape. The drivers were defined based on an analysis of three long-term trends influencing organizations: globalization, complexity, and technology. The drivers provide the framework for key activities that professional accountants will be expected to perform. These activities are highlighted under the following four roles that form the cornerstones of the services provided by professional accountants: creators, enablers, preservers, and reporters of sustainable value. Previously defined in the 2010-2012 PAIB Strategy and Work Plan, these roles have received wide support so far.
The Consultation Paper is available at www.ifac.org/PAIB/. Responses are requested by November 30, 2010.
2) Competent and Versatile: Q&A for Smaller Organizations and the Accountants That Serve Them
A question & answer (Q&A) article has been prepared to help those accountants who work in, or provide services to, smaller organizations to apply the principles in the Consultation Paper, Competent and Versatile.
Although the size and complexity of an organization affect the required mix of competences for professional accountants in business, the general principles around the roles and competences discussed in Competent and Versatile can be applied everywhere. This Q&A article considers what sustainable success specifically means for a smaller organization and how the drivers of sustainable value apply in their context.
3) IFAC-UNCTAD Conference: Preventing the Next Financial Crisis and the Role of Accountants in Corporate Governance
The accountancy profession has a key role to play in strengthening corporate governance and facilitating the integration of governance and sustainability into the strategy, operations, and reporting of organizations, according to conclusions that came out of the recent conference hosted by IFAC and the United Nations Conference on Trade and Development (UNCTAD). Attended by accountancy leaders from around the world, the conference featured panels and interactive discussions that focused on lessons learned from the financial crisis, and the next steps and reforms that will strengthen corporate governance and help prevent future crises.
Overall, conference participants agreed on the following conclusions:
- The accountancy profession has a key role to play in strengthening corporate governance and facilitating the integration of governance and sustainability into the strategy, operations, and reporting of an organization.
- Boards should be focused on the long-term sustainability of their businesses. As such, corporate governance reform must include strengthening board oversight of management, positioning risk management as a key board responsibility, and encouraging remuneration practices that balance risk and long-term (social, environmental, and economic) performance criteria.
- Governance is about more than having the right structures, regulation and principles in place--it is about ensuring that the right behaviors and processes are in place.
- Governance mechanisms need to be strengthened at banks and other companies to ensure better oversight of risk management and executive compensation.
- More dialogue is needed between policy makers, the accounting profession, and other financial industries to consider how we can work together effectively on a global level.
See also the following IFAC resources: Evaluating and Improving Governance in Organizations, the Business Reporting Series, and the IFAC Sustainability Framework (updated edition coming soon). In addition, see UNCTAD's Corporate Governance in the Wake of the Financial Crisis: Selected International Views, to which IFAC contributed a chapter, and which will be available soon at www.unctad.org.
4) Business Reporting Project: Recommendations from the Investment Community
IFAC has published the third article in its five-article series on how to improve business reporting, corporate governance, and auditing in the aftermath of the financial crisis. In the third article, Business Reporting Through the Lens of the Investor, six specialists with close ties to the investment community present their views on overcoming complexity in financial reports, the use of management commentary, and how to integrate sustainability reporting, among other topics.
We invite our member bodies to publish or post the articles from this series on their websites and in their magazines or journals. Readers are also encouraged to comment on the recommendations of individual business leaders via a brief survey. The articles, along with transcripts of the full interviews and links to the surveys, are available at www.ifac.org/frsc. Based on the recommendations and reader input, IFAC plans to develop an overall concluding article and a follow-up action plan.
5) Links to Relevant Resources
A. The Association of Chartered Certified Accountants (ACCA)
ACCA's Series on Human Capital, including Accountants for Business: Human Capital in Accounting and Finance
B. Australian Learning and Teaching Council
Australian Accounting for the Future Project and Final Report (2009)
C. The Chartered Institute of Management Accountants (CIMA)
Finance Transformation--reports and audiocast
D. CPA Australia (with Accenture)
The Australian CFO Agenda
E. The Institute of Chartered Accountants in Australia (with KMPG)
CFO of the Future--a report on the evolving role of the CFO
F. The Institute of Chartered Accountants in England & Wales (ICAEW)
Finance Direction--an initiative that includes a series of articles related to the evolution of the finance function
A future rich in opportunity: Internal audit must seize opportunities to enhance its relevancy--2010 state of the internal audit profession study
H. United Parcel Service of America
CFO Kurt Kuehn's presentation at the IMA annual conference
Other PAIB Committee Developments
1) Enhanced International Center for Professional Accountants in Business
IFAC recently enhanced the professional accountants in business (PAIB) section of the IFAC website, improving access to tools, resources, and key projects and initiatives conducted by the PAIB Committee and IFAC members.
The information in this area, known as the International Center for Professional Accountants in Business, has been reorganized by topic areas to improve usefulness. Each of the following key topic areas corresponds with a navigational tab along the top of the page:
- Governance and ethics
- Risk management and control
- Sustainability and corporate responsibility
- Financial management
- Business reporting
To explore the newly redesigned site and access the many resources, including relevant links, the PAIB eNews, and PAIB Committee reports and initiatives, see www.ifac.org/PAIB/.
2) IFAC 2010-2012 Strategy and Work Plan to Serve Professional Accountants in Business
IFAC has released its Professional Accountants in Business Strategy and Work Plan for 2010-2012, which is available in the International Center for Professional Accountants in Business. The strategic direction outlined in the plan focuses on enhancing the profile, influence, and relevance of professional accountants in business and identifies two key objectives:
- Increasing awareness of the important roles professional accountants play in creating, enabling, preserving, and reporting value for organizations and their stakeholders; and
- Supporting the professional accountants in business within IFAC member bodies by facilitating the communication and sharing of good practices and ideas.
To comment or inquire about any of the items mentioned above or for questions about the PAIB Committee, please contact firstname.lastname@example.org.
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