Member | Established: 1904 | Member since 1977
ACCA (the Association of Chartered Certified Accountants) is a global body for professional accountants with 219,000 members and 517,000 students in 179 countries. It was granted a Royal Charter in 1974 which commits it to acting in and upholding the public interest. ACCA works through a network of 110 offices and centres and 7,571 Approved Employers worldwide, and 328 approved learning providers who provide high standards of learning and development. ACCA holds recognition for statutory audit purposes in certain jurisdictions including the UK, Ireland, and Zimbabwe and for tax purposes in Australia and South Africa. In addition to IFAC membership, ACCA is represented on key regional forums including the ASEAN Federation of Accountants (AFA), the Confederation of Asian and Pacific Accountants (CAPA), Accountancy Europe, the Institute of Chartered Accountants of the Caribbean (ICAC), the Pan African Federation of Accountants (PAFA), and is a member of CCAB in the UK and Ireland. It undertakes wide-ranging capacity building work globally and has an extensive network of partnerships with other professional accountancy organizations.
Statements of Membership Obligation (SMO)
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.
SMO 1: Quality Assurance
The Financial Reporting Council (FRC) and the four Recognized Supervisory Bodies (RSBs) in the UK (ACCA, CAI, ICAEW, and ICAS) share responsibility for the quality assurance (QA) review system governing audits and assurance engagements in accordance with the Companies Act of 2006 and the Statutory Auditors and Third-Party Auditors Regulations 2016 (SI 2016/649). All have indicated that they have a fully operational QA review system in place that is aligned with SMO 1 requirements.
ACCA has established long-standing policies and procedures, in its Global Practicing Regulations, that guide the QA review process, which it reviews periodically to ensure compliance with SMO 1. ACCA has also developed workshops (example) and other training initiatives, such as an ISQC 1 guide to educate and support its members on quality control standards.
ACCA reports that its QA mechanism is periodically reviewed to ensure continued compliance with SMO 1. Examples of ongoing review include the effectiveness of its quality assurance inspection procedures, particularly in driving improvements in audit quality. Following a roundtable hosted by the FRC—in July 2017 and November 2018—the RSBs have agreed on KPIs related to audit quality that are linked to the outcome of quality assurance reviews. ACCA reports that it will monitor the KPIs and identify the root causes of non-compliance with auditing standards in order to develop further enhancements in the QA process.
Finally, the ACCA provides consultancy services to foreign regulators wishing to establish quality assurance schemes compliant with SMO 1. It has also been appointed by foreign regulators to provide QA review services on their behalf.
SMO 2: International Education Standards
The six Recognized Qualifying Bodies (RQBs) deliver the initial and continuing professional education (IPD and CPD) requirements for statutory auditors in the UK. The FRC has an agreement with the six chartered bodies (ACCA, the Association—CIMA, CIPFA, ICAEW, CAI, and ICAS) and the AIA to oversee IPD and CPD for accountants.
Five RQBs (ACCA, CAI, ICAEW, ICAS, and CIPFA) as well as AAT, the Association—CIMA and IFA are members of IFAC, and all confirm that their professional accountancy qualifications align with the requirements of the revised 2015 IES.
ACCA maintains the compliance of its IPD and CPD requirements with IES requirements through the work of its Regulatory Board and its Qualifications Board. All education requirements are published in ACCA’s e-magazines teach accounting and Student Accountant, for members and students respectively.
An external examiner verifies and reports to the Qualifications Board on the compliance of its examinations. Exam syllabuses are annually updated to ensure compliance with the latest tax, law, audit and financial reporting requirements.
The ACCA has been an active participant in the international standard setting process including: reviewing pronouncements issued by the IAESB, responding to Exposure Drafts, putting forward representatives to serve on the IAESB, assisting task forces and working parties on IAESB initiatives, and publishing IAESB news for its members in its e-magazine. The association has also supported the work of the IAESB through commissioning international research projects. In addition, ACCA has regularly consults with regulators, members, employers, learning providers, and students on syllabus, training requirements, and qualification changes.
Finally, the ACCA operates Joint Examinations Schemes with other IFAC members and/or potential members to allow them to adopt the ACCA's syllabus and examinations, which in turn assists them in meeting SMO 2 requirements.
SMO 3: International Standards on Auditing
The Financial Reporting Council (FRC) is the authorized body for setting auditing standards in the UK in accordance with the Companies Act of 2006 and Statutory Instrument on Statutory Auditors (Amendment of Companies Act 2006 and Delegation of Functions etc.) Order 2012 (SI 2012/1741). All financial statement audits must be conducted in accordance with International Standards on Auditing (UK) issued by the FRC. ISAs (UK) are based on the ISA issued by the IAASB, with some additions to account for UK Company law.
The ACCA has no direct responsibility for the adoption and implementation of ISA in the UK. Nevertheless, the association has lobbied the UK and EU to adopt ISA and responds to both IAASB and FRC Exposure Drafts. It also promotes adoption and development of IAASB standards through its work on the Audit and Assurance Policy Group of the Federation of European Accountants.
The ACCA further supports the adoption and standard-setting processes by gathering views from members through its website and Global Forums, commissioning research projects addressing issues of importance related to the work of the IAASB and putting forward representatives to serve on the IAASB (as members and technical advisers) and its working parties.
The association provides implementation support to its members by publishing details of IAASB pronouncements and related articles in its journal, Accounting and Business, and including updates in relevant sections of its website. The ACCA includes ISA updates in its initial professional development and continuing professional development programs and exams, and offers an e-qualification in International Auditing based on the ISA pronouncements.
SMO 4: Code of Ethics for Professional Accountants
In accordance with their charters and by-laws, professional accountancy organizations (PAOs) in the UK are authorized to establish ethical requirements for their members.
All PAOs in the UK indicate that they have adopted the requirements of the IESBA Code of Ethics (2018 version). Furthermore, all PAOs indicate that they have an ongoing process to consider and incorporate new and amended requirements issued by the IESBA where they are not in conflict with national laws and regulations.
ACCA incorporates, on an ongoing basis, the IESBA Code of Ethics—in its entirety—into the ACCA Code of Ethics and Conduct. It adds guidance where necessary, for example, on money laundering and whistle blowing.
The ACCA incorporates ethics into all of its initial professional development and continuing professional development requirements, and members are given information on ethical requirements via its various media, including publications, technical features, factsheets, e-magazines, and its website. All ACCA members have to successfully complete the ACCA Professional Ethics Module in addition to passing all the exams and completing the practical experience requirement before they are admitted into membership.
The ACCA makes information available to its members about proposed, new, and revised pronouncements from the IESBA, and participates in the international standard-setting process by responding to Exposure Drafts.
SMO 5: International Public Sector Accounting Standards
The UK Treasury is responsible for developing standards and policies for Central Government financial statements. The Chartered Institute of Public Accountancy (CIPFA) and the Local Authority Scotland Accounts Advisory Committee (LASAAC) work together on the Local Authority Code Board, a standing committee of CIPFA and LASAAC, to set accounting standards for local governments in the UK. The Code of Practice is based on EU-adopted IFRS and draws on IPSAS and Financial Reporting Standards issued by the Financial Reporting Council.
The ACCA supports the adoption and implementation process for strong public financial management in the UK particularly through delivering qualifications for public sector professionals. ACCA continues to support professionalization of public sector staff in IPSAS through ACCA’s globally recognized Certificate in IPSAS, working directly with public sector bodies and indirectly through donors to increase the number of public sector accountants with IPSAS proficiency. The association supports implementation of high-quality public financial management by offering continuing professional development courses to its members.
The ACCA actively lobbies the UK and EU for the adoption of IPSAS and to ensure that the decision to develop European Public Sector Standards will produce standards that are as closely aligned to IPSAS as practicably possible. In addition, the ACCA responds to Exposure Drafts of pronouncements issued by the IPSASB and solicits the views of its members through its website, the ACCA Public Sector Global Forum, and the Financial Reporting Global Forum. It publishes details of IPSASB pronouncements through its member magazines (Accounting and Business (AB) and AB Direct), email news, and technical bulletins.
SMO 6: Investigation and Discipline
In accordance with their charters and by-laws, professional accountancy organizations (PAOs) are authorized to establish systems of investigation and discipline (I&D) for their members for failure to comply with applicable standards of professional conduct. The PAOs (both RSBs and others: AAT, the Association—CIMA, CIPFA, and IFA) have reported that they have I&D systems in place that fulfill the requirements of SMO 6 requirements.
In 2014, ACCA’s Professional Conduct Department was restructured into three separate departments: the Assessment Department, the Investigations Department, and the Adjudication Department. The restructure has provided the ACCA with greater oversight of each stage of the I&D process. The procedures of the I&D process are assessed on an ongoing basis for compliance with the requirements of SMO 6, particularly when any changes are introduced.
The ACCA maintains a Rulebook, and guidance materials to provide support for members and the public in dealing with its I&D system, such as, but not limited to the following: Guide to ACCA’s Hearings Team and Disciplinary Regulatory Committees; Guidance for Disciplinary Hearings; Guidance for Appeal Hearings; Guidance for Disciplinary Sanctions. The association provides a Conciliation Service as part of its scheme to enable disputes between members and clients to be resolved swiftly by allowing minor breaches to be dealt with through Alternative Dispute Resolution.
The ACCA operates a Regulatory Board with a lay majority to provide internal oversight of its disciplinary and regulatory activities. It reports regularly to the Board and the UK’s Financial Reporting Council’s Oversight Team, the regulator that oversees statutory auditors. The association publishes the results at the conclusion of hearings.
To ensure effective and efficient management of its I&D system, the ACCA maintains a case management system and a centralized database as a record of cases and all actions taken. The association regularly reports to management and externally on processing times and other scheduling data. The ACCA takes additional steps of maintaining an outsourcing fund to manage spikes in relation to Case Presentation resource capacity, and it employs independent legal advisers for regulatory and disciplinary hearings. Furthermore, it performs an annual review of the scheme’s compliance with the Human Rights Act of 1998, natural justice, and best practice.
The association provides implementation support to its members by incorporating lessons learned from the I&D system into continuing professional development (CPD), articles, and technical factsheets on common complaint areas. The CPD system incorporates online tests to ensure members demonstrate necessary competencies.
SMO 7: International Financial Reporting Standards
The Financial Reporting Council (FRC) has the authority to adopt accounting standards in the UK in accordance with the Companies Act of 2006 and Statutory Instrument on Statutory Auditors (Amendment of Companies Act 2006 and Delegation of Functions etc.) Order 2012 (SI 2012/1741).
EU-endorsed IFRS are required to be applied in consolidated financial statements of parent companies with securities that are traded on a regulated market. Other entities apply ‘reduced disclosure’ EU adopted IFRS, or simpler Financial Reporting Standards (FRS) developed by the FRC, depending on the size, type of company, and the nature of activities that is conducted. FRS is based on the IFRS for SMEs, with significant modifications.
The ACCA includes IFRS updates in its initial professional development and continuing professional development programs and exams, and offers a diploma and/or certificate in IFRS and IFRS for SMEs. The ACCA also commissions research on topical IFRS issues. Recent studies in ACCA’s international research program have explored, for example, the quality of compliance with the standards dealing with business combinations and a companion guide for not-for-profits to use the IFRS for SMEs. Other recent research-led activity includes surveys of CFOs and investors on global standards and how they are using annual reports. Furthermore, the association works with foreign regulators and standard setters on the adoption and implementation of IFRS or convergence with IFRS.
The ACCA supports and promotes adoption and implementation of IFRS in the UK and in the EU. It provides members with implementation support by publishing updates from the IASB pronouncements and related relevant articles in its journal and on its website. The association also responds to IASB Exposure Drafts on new and revised pronouncements and solicits views from its members through its website, surveys, and its Corporate Reporting Global Forum.
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.
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