Barbados

Member Organizations

Member Organization Associate

  Institute of Chartered Accountants of Barbados

Legal and Regulatory Environment

  • Overview of Statuatory Framework for Accounting and Auditing

    In Barbados, the Companies Act Chapter 308 of 2002 (amended 2019) addresses financial reporting requirements. The Act requires all companies, except external companies as defined in the amendments, to prepare financial statements.

    The Companies Act does not specify accounting or auditing standards to be applied but rather Section 5 of the Institute of Chartered Accountants of Barbados (Incorporation) Act 1974 establishes ICAB as the official accounting and auditing standard-setter in Barbados. ICAB has fully adopted IFRS and IFRS for SMEs as issued, including effective dates, as the national accounting standards since 2007 and 2010, respectively. Public interest entities, such as companies listed on the stock exchange, banks or similar financial institutions, non-banking financial services, trust companies, credit unions, insurance companies, and mutual funds that take third party risks or funds, are required to use full IFRS while all other companies may use either IFRS or IFRS for SMEs.

    Public interest entities, as described above, and companies with gross revenues or assets more than BDS 4,000,000 must undergo an annual audit by an individual who holds a practicing certificate from the ICAB. ICAB has adopted ISA and all other pronouncements of the IAASB without modification (ISREs, ISAEs, ISRSs and ISQCs) as the applicable auditing standards.

  • Regulation of Accountancy Profession

    In Barbados, accountancy professionals are regulated by the Institute of Chartered Accountants of Barbados (ICAB). It was established by the Institute of Chartered Accountants of Barbados (Incorporation) Act 1974 and its membership includes Chartered Accountants along with students pursuing professional accounting qualifications.

    According to the legislation, ICAB has the responsibility to: (i) promote, foster and maintain the highest standards of accounting in public practice, the public service and commercial and industrial spheres; (ii) safeguard and enhance the professional standing, interest and reputation of accountants who are members thereof and are employed in the spheres specified above; (iii) maintain the highest standards of professional etiquette and ethics amongst its members and encourage the observance of such standards among non-members; and (iv) express its views to the Government, public authorities, commissions of enquiry and similar bodies regarding matters affecting its members and the profession.

    In its regulatory role, ICAB is responsible for the following aspects: (i) the adoption of accounting and auditing standards in the jurisdiction; (ii) establishing ethical requirements for its members; (iii) licensing and regulation of auditors in Barbados, including the establishment of a quality assurance review system; (iv) prescribing admission requirements; (v) establishing continuing professional development requirements for its members; (vi) the investigation and discipline of its members; and (vii) maintaining a public registry of its practicing members.

    Membership of the institute is mandatory to offer accountancy services to the public. Individuals wishing to enter public practice must fulfill the following requirements: be a local resident, apply and register as a Chartered Accountant of ICAB by being a member of one of the professional accountancy organizations (PAO) listed below, demonstrate proof of monitored practical experience before, during, and after qualification, and receive a practicing certificate from the institute. The institute issues two types of practicing certificates: general and specialty. A general practicing certificate is issued to qualified members who intend to engage in all areas of public practice while specialty practicing certificates are granted to members who engage in public practice but are restricted to taxation or advisory/consulting services based on their practical experience. Accordingly, only ICAB members with a general practicing certificate may conduct audits.

    The accountancy profession in Barbados has grown through the inclusion of professional accountants qualified overseas. ICAB has determined a list of overseas institutes that are recognized for ICAB membership purposes—and consequently the initial professional development requirements for professional accountants in the jurisdiction. The recognized overseas accountancy institutes include: the Association of Chartered Certified Accountants, the Institute of Chartered Accountants in England & Wales, the Institute of Chartered Accountants of Scotland, the Institute of Chartered Accountants of Ireland, CPA Australia, CPA Canada, the Institute of Chartered Accountants of Australia and New Zealand, and AICPA—CIMA. These PAOs require aspiring members to complete a professional accountancy education program, a practical experience requirement, and pass final examinations that are developed in line with the IES. ICAB will review applications of professionals from other PAOs on a case-by-case basis.

    Lastly, students enrolled in any of the abovementioned accountancy organizations are required to register as a student of ICAB. To register as a student, individuals must have been recommended for registration by a member of ICAB or by someone of official standing approved by the Council, not be less than 18 years of age, and have passed examinations accepted by the institute indicating a satisfactory standard of general education.

  • Audit Oversight Arrangements

    There is no independent audit oversight authority. Auditors in Barbados are regulated by the Institute of Chartered Accountants of Barbados (ICAB) as established by the Institute of Chartered Accountants of Barbados (Incorporation) Act 1974. Membership of the institute is mandatory to practice auditing.

    After acquiring membership of ICAB as a Chartered Accountant by fulfilling educational, practical experience, and examination requirements, ICAB members must satisfy additional requirements to publicly practice. These include: being a local resident, demonstrating proof of monitored practical experience before, during, and after qualification, and receiving a practicing certificate from the institute. The institute issues two types of practicing certificates: general and specialty. A general practicing certificate is issued to qualified members who intend to engage in all areas of public practice while specialty practicing certificates are granted to members who engage in public practice but are restricted to taxation and consulting based on their practical experience. Accordingly, only ICAB members with a general practicing certificate may conduct audits.

    According to its founding legislation, ICAB is responsible for the following regulatory aspects: (i) the adoption of auditing standards for the jurisdiction; (ii) establishing ethical requirements for its members; (iii) licensing and regulation of auditors in Barbados, including the establishment of a quality assurance review system; (iv) prescribing admission requirements; (v) establishing continuing professional development requirements for its members; (vi) the investigation and discipline of its members; and (vii) maintaining a public registry of its practicing members.

  • Professional Accountancy Organizations

    In Barbados, the Institute of Chartered Accountants of Barbados (ICAB) is the only professional membership organization representing Chartered Accountants along with students pursuing professional accounting qualifications. It is established by the Institute of Chartered Accountants of Barbados (Incorporation) Act 1974. Membership of the institute is mandatory to offer accountancy services to the public.

    According to the legislation, ICAB has the responsibility to: (i) promote, foster and maintain the highest standards of accounting in public practice, the public service and commercial and industrial spheres; (ii) safeguard and enhance the professional standing, interest and reputation of accountants who are members thereof and are employed in the spheres specified above; (iii) maintain the highest standards of professional etiquette and ethics amongst its members and encourage the observance of such standards among non-members; and (iv) express its views to the Government, public authorities, commissions of enquiry and similar bodies regarding matters affecting its members and the profession.

    In addition to being a member of IFAC, ICAB is also a member of the Institute of Chartered Accountants of the Caribbean.

  • Projects or Other Information

    In June 2015, the World Bank published its Report on the Observance of Standards and Codes (ROSC) on the accounting and auditing practices in the Caribbean. Barbados was included in the review which included an assessment of the accounting, financial reporting, and auditing practices in the public and private sectors in Barbados together with policy recommendations to enhance the quality of financial reporting. The ROSC issued recommendations at a regional, national, and professional accountancy organization level. Specific recommendations for Barbados in both the short and long term included: (i) defining public interest entities and small- and medium-sized entities and establishing an appropriate differential financial reporting framework for these companies; (ii) building up the Institute of Chartered Accountants of Barbados (ICAB)’s financial and infrastructure capacity; (iii) strengthening monitoring and disciplining of state-owned enterprises that may be late in meeting reporting requirements; (iv) strengthening regulators’ capacity to monitor and enforce compliance with financial reporting requirements of entities for which they are responsible; (v) ensuring IPSAS adoption and implementation; (vi) strengthening ICAB’s technical capacity to support its members with international financial reporting and auditing standards; (vii) consider reviewing interim financial reports of listed companies; and (viii) consider creating an e-repository of audit reports for greater ease of access.

    As part of ICAB’s Strategic Plan 2015-2018, ICAB re-ordered its priorities, adjusted its agenda, and restructured its committees to ensure successful implementation of the plan. This included the significant Governance Improvement Project which focused on both conformance and performance dimensions of ICAB. The Ethics, Governance and Risk (EG&R) Committee developed governance policies and procedures for Confidentiality, Conflict of Interest, and Efficient & Effective Committees. As a result, with effect from January 1, 2016 there was a new system for the appointment, management, and evaluation of committees that places a greater emphasis on effectiveness and performance.

Adoption of International Standards

  • Quality Assurance

    The Institute of Chartered Accountants of Barbados (ICAB) is responsible for establishing a mandatory quality assurance (QA) review system for all audits as well as adopting ISA and all other IAASB pronouncements, including ISQC 1.

    ICAB established its QA review program in January 2009 as part of a tripartite agreement between ICAB, the Association of Chartered Certified Accountants (ACCA), and the Institute of Chartered Accountants of the Caribbean. Under the most recent agreement, which became effective on January 1, 2016 and expires on December 31, 2021, ACCA’s team of Practice Reviewers carry out the QA reviews on behalf of ICAB. All practicing members who perform audit services are covered by the reviews. The QA review cycle is six years with audits of public interest entities reviewed every three years and auditors with unsatisfactory reports may be reviewed on a shorter cycle.

    ICAB indicates that the scope and design of the QA review system as developed by the ACCA is in line with SMO 1 requirements.

    Current Status: Adopted

  • International Education Standards

    Section 5 of the Institute of Chartered Accountants of Barbados (Incorporation) Act 1974 requires the Institute of Chartered Accountants of Barbados (ICAB) to set rules and regulations for the accountancy profession. Accordingly, ICAB’s Student Regulations establish initial professional development (IPD) requirements while its Continuing Professional Development (CPD) Regulations establish CPD requirements.

    The accountancy profession in Barbados has grown through the inclusion of professional accountants qualified overseas. ICAB has determined a list of overseas institutes that are recognized for ICAB membership purposes—and consequently the initial professional development requirements for professional accountants in the jurisdiction. The recognized overseas accountancy institutes include: the Association of Chartered Certified Accountants, the Institute of Chartered Accountants in England & Wales, the Institute of Chartered Accountants of Scotland, the Institute of Chartered Accountants of Ireland, CPA Australia, CPA Canada, the Institute of Chartered Accountants of Australia and New Zealand, and AICPA—CIMA. These PAOs require aspiring members to complete a professional accountancy education program, a practical experience requirement, and pass final examinations that are stated to be in line with the revised IES. ICAB will review applications of professionals from other PAOs on a case-by-case basis.

    ICAB has not established a local tax and business legislation exam as a final assessment for its members and therefore, its IPD requirements are not fully in line with the principles of IES 6 requirements.

    ICAB reports that it updated its CPD regulations in May 2018 and they are line with the revised IES.

    Current Status: Partially Adopted

  • International Standards on Auditing

    In accordance with Section 5 of the Institute of Chartered Accountants of Barbados (Incorporation) Act 1974, the Institute of Chartered Accountants of Barbados (ICAB) is responsible for adopting auditing standards. Through direct reference, ICAB has adopted ISA as the applicable auditing standards in Barbados as well as all other pronouncements as issued by the IAASB without modifications and including effective dates.

    Current Status: Adopted

  • Code of Ethics for Professional Accountants

    The Institute of Chartered Accountants of Barbados (ICAB) is responsible for establishing ethical requirements for its members in accordance with the Institute of Chartered Accountants of Barbados (Incorporation) Act 1974 and its By-Laws.

    ICAB’s By-Laws define its Code of Ethics as the Code of Ethics for Professional Accountants as issued by the IESBA. As such, ICAB’s members are required to adhere to the currently effective version of the IESBA Code.

    Current Status: Adopted

  • International Public Sector Accounting Standards

    The Barbados government, specifically, the Comptroller General, is responsible for setting public sector accounting standards. In 2019, the Public Finance Management Act was passed and specified IPSAS as issued by the IPSASB as the accounting standards to be applied by public sector entities.

    Current Status: Adopted

  • Investigation and Discipline

    In accordance with the Institute of Chartered Accountants of Barbados (Incorporation) Act 1974 and the Institute of Chartered Accountants of Barbados (ICAB)’s By-Laws, ICAB is responsible for establishing an investigative and disciplinary (I&D) system for its members.

    ICAB’s Disciplinary Regulations establish I&D procedures, which it states are in line with the SMO 6 requirements. ICAB has created Investigations, Discipline, and Appeals Committees to carry out its I&D functions. The Investigations Committee is responsible for investigating complaints while the Disciplinary Committee is responsible for conducting hearings and imposing sanctions. ICAB has also ensured independence of the committees through its By-Laws.

    Current Status: Adopted

  • International Financial Reporting Standards

    In Barbados, the Companies Act Chapter 308 of 2002 (amended 2019) addresses financial reporting requirements. The Act requires all companies, except external companies as defined in the amendments, to prepare financial statements.

    The Companies Act does not specify accounting standards to be applied but rather Section 5 of the Institute of Chartered Accountants of Barbados (Incorporation) Act 1974 establishes ICAB as the official accounting and auditing standard-setter in Barbados. ICAB has fully adopted IFRS and IFRS for SMEs as issued, including effective dates, as the national accounting standards since 2007 and 2010, respectively. Public interest entities, such as companies listed on the stock exchange, banks or similar financial institutions, non-banking financial services, trust companies, credit unions, insurance companies, and mutual funds that take third party risks or funds, are required to use full IFRS while all other companies may use either IFRS or IFRS for SMEs.

    Current Status: Adopted

Disclaimer

IFAC bears no responsibility for the information provided in the SMO Action Plans prepared by IFAC member organizations. Please see our full Disclaimer for additional information.

 

Methodology

Methodology
Last updated: 07/2021
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