Member | Established: 1961 | Member since 1977
The ICPAC was established in 1961 in accordance with the provisions of the Companies Law, Cap. 113. ICPAC membership is comprised of practicing and non-practicing accountancy professionals. Practicing professionals are accountants and auditors in public practice who possess a practicing certificate and provide accounting, audit, tax, consulting, company administration services, insolvency and other services. Non-practicing accountancy professionals work in the public and private sectors and are not required. In accordance to the Law, all statutory auditors and audit firms must be registered with a Recognised Body of Auditors.
ICPAC, is expected to be delegated the responsibility for the following duties when the delegation agreement is signed with the CyPAOA: (i) certification and registration of statutory non-PIE auditors and audit firms; (ii) administering, training and monitoring of the continuing professional development program; (iii) enforcement of members’ compliance with the applicable laws, regulations, ethical and professional standards; and (iv) implementation of a quality assurance review system and an investigative and discipline system for statutory non-PIE auditors.
In addition to being a member of IFAC, ICPAC is a member of Accountancy Europe and the Mediterranean Federation of Accountants.
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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.
Methodology
Last updated: 07/2017
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SMO Action Plan
Status of Fulfillment by SMO
- SMO 1: Quality Assurance
According to the Law, the responsibility to establish and operate a quality assurance (QA) review system is mandated to the Cyprus Public Audit Oversight Authority (CyPAOA). ICPAC administes the system with the assistance of the Association of Chartered Certified Accountants (ACCA). Upon completion of its review of the revised requirements of SMO 1 in 2014, ICPAC incorporated the necessary changes and raised member awareness of the requirements. ICPAC continues to use its best efforts to ensure that the system is fully compliant with the requirements of revised SMO 1. The responsibility however, will be officially delegated by the CyPAOA upon signing of a delegation agreement,
ICPAC envisages to collaborate closely with CyPAOA and share information on a pre-agreed time frame and format to enhance the overall monitoring of the profession’s performance. The Institute notes that it supports its members in their implementation of quality control and auditing standards by providing educational and training programs. ICPAC also provides up-to-date, relevant information in its quarterly magazine, Accountancy Cyprus and facilitates access to IFAC Global Knowledge Gateway.
ICPAC offers a number of educational seminars for its members including complimentary seminars in order to strengthen their knowledge and compliance. The QA review team is properly qualified and trained by the ACCA. Furthermore, the Prevention and Suppression of Money Laundering Activities Law renders ICPAC as the Supervisory Authority for auditors and trust and company service providers for anti-money laundering purposes.
The current QA review arrangements are expected to change with the signing of the delegation agreement. CyPAOA will conduct the QA reviews of audit firms that audit public interest entities (PIEs), while ICPAC will be responsible for the QA review system for firms that audit non-PIEs.
ICPAC is encouraged to continue with its close cooperation with the CyPAOA as the responsibilities for the QA review system are being defined to ensure that the resulting system continues to be in line with the requirements of SMO 1. ICPAC could also highlight the training opportunities it offers to its members to strengthen capacity to effectively implement the QA review system.
Current Status: Review & Improve
- SMO 2: International Education Standards
With initial professional development (IPD) requirements established in the law, ICPAC is responsible for their implementation as well as for administering, training and monitoring of the continuing professional development (CPD) program.
ICPAC reports in its SMO Action Plan that it supports ongoing adoption and implementation of IAESB pronouncements and has established an ongoing process to review the requirements of the revised IES and determine whether its IPD and CPD requirements comply with those of the revised IES. ICPAC reports that the revision of the requirements of its CPD scheme to align with IES 8 were completed by December 2016
ICPAC reports that it monitors the IAESB work program and provides comments on exposure drafts. It uses email and the institute’s quarterly magazine and website to ensure that members and other stakeholders are informed of updates issued by the IAESB. ICPAC collaborates with the Association of Chartered Certified Accountants (ACCA), its partner in the joint examination scheme, to ensure that the examination and CPD syllabi incorporate new and revised international accounting, auditing, internal control, and ethical standards. ICPAC members are subject to a mandatory CPD program which entails 40 hours of relevant CPD annually. Members are required to make an annual declaration of their CPD fulfillment.
In addition, ICPAC delivers a wide range of courses and training opportunities to its members. In 2016, the Institute together with ACCA provided CPD training to focus on the revised IES 8.
ICPAC is encouraged to report the results of its review of requirements of the revised IES and communicate to the IFAC Quality & Development staff the extent of alignment of professional accountancy education with those of IES.
Current Status: Review & Improve
- SMO 3: International Standards on Auditing
With ISA adopted by law in Cyprus, ICPAC focuses on ensuring that members of the profession have access to the necessary education and training for implementing new and revised standards and translations of the standards in Greek.
The Institute states that it includes compulsory modules on auditing and assurance in the initial professional development program, and also incorporates courses that address technical challenges identified in the quality assurance review program. Whenever new ISA pronouncements are issued, ICPAC provides practical guidance via technical circulars to its members. As of December 2016, all of the Institute’s members are required to adopt the new audit report standards. ICPAC has circulated the update to its members and has designed and offered educational presentations for all its members to familiarize themselves with the new standards.
The Institute reports to monitor the IAASB work program, provide comments on exposure drafts, and disseminate information on changes to members of the profession and other stakeholders via email, its quarterly magazine, Accountancy Cyprus and its new website that was launched in early 2015.
ICPAC indicates that it collaborates with the Hellenic Accounting and Auditing Standards Oversight Board (ELTE) and the Cyprus Public Audit Oversight Board (CyPAOB) on translating IAASB pronouncements into Greek according to IFAC translation policy. However as of 2017, the latest translation of ISA available is that of 2010.
ICPAC is encouraged to collaborate with the ELTE and CyPAOB to establish an ongoing process for the translation and publication of the standards. Developing an ongoing process will also reduce the time lag between translations of the standards to ensure that the latest international pronouncements are available on an ongoing basis.
Current Status: Review & Improve
- SMO 4: Code of Ethics for Professional Accountants
ICPAC shares responsibility for the adoption of ethical standards for the accountancy profession with Cyprus Public Audit Oversight Board, which mandates application of the IESBA Code of Ethics for all auditors. In addition, ICPAC’s regulations require its members, both auditors and non-auditors, to comply with the IESBA Code of Ethics (2009), which ICPAC has adopted.
ICPAC reports that it supports the ongoing adoption and implementation of the Code of Ethics by monitoring the IESBA’s work programs and circulating all new and revised pronouncements to its members and the public. New information, as well as clarifications and practical guidance, is disseminated via email and in the quarterly magazine, and the IESBA Code of Ethics for Professional Accountants are made available on an annual basis. Additionally, ICPAC provides a variety of courses in the initial professional development and continuing professional development programs on IESBA pronouncements to raise awareness, improve understanding, and enhance compliance with the requirements.
Furthermore, ICPAC also continues to collaborate with the Hellenic Accounting and Auditing Standards Oversight Board (ELTE) to produce an updated translation of the Code of Ethics in Greek. As of 2017, the translation of the 2015 version of the IESBA Code is in progress.
In addition, the institute reviews and provides comments on IESBA exposure drafts.
ICPAC is encouraged to collaborate with the ELTE to establish an ongoing process for the translation and publication of the IESBA Code of Ethics to ensure that the latest version is being applied.
Current Status: Review & Improve
- SMO 5: International Public Sector Accounting Standards
Although ICPAC has no direct responsibility for the adoption of public sector accounting standards in Cyprus, it indicated in its 2017 SMO Action Plan that it promotes the adoption of IPSAS to the Accountant General—the authority responsible for setting public sector accounting standards.
ICPAC has established a Public Sector Committee and the committee members participate as observers in a Government Steering Committee that was established to explore the adoption and implementation of accrual IPSAS. ICPAC reports that the Government’s Steering Committee has issued an action plan outlining a timeline to convert from the currently applicable cash-basis accounting standards to the accrual-basis standards. The action plan was launched in April 2016 by the Treasury Department and is expected to be completed in 2022.
ICPAC’s Public Sector Committee also monitors the IPSASB’s work program and provides updates to members via email and the institute’s quarterly magazine, Accountancy Cyprus. The institute intends to disseminate information on IPSAS on the ICPAC website which was launched in 2015.
During 2017, ICPAC has organized two education seminars designed and available only for public sector members of the Institute.
ICPAC is encouraged to consider organizing educational and training events for public sector accountants and to participate in the international standard-setting process by providing comments on IPSASB Exposure Drafts, if deemed relevant.
Current Status: Review & Improve
- SMO 6: Investigation and Discipline
The new Auditors Law of 2017 enforces an I&D system for all firms in the jurisdiction under the direct responsibility of the Cyprus Public Audit Oversight Authority (CyPAOA). The expected delegation agreement between CyPAOA and ICPAC will specify the level of I&D to be allocated to ICPAC and the responsibility for the overall I&D system will be shared between CyPAOA and ICPAC. CyPAOA will be responsible for the investigation and discipline of auditors who audit public interest entities and ICPAC will be responsible for the I&D of the rest of the profession. Until these responsibilities have been formalized, ICPAC continues to implement a system of I&D for its members that complies with the requirements of SMO 6.
The I&D process of ICPAC is two-fold. It involves the regulatory function and a disciplinary system. The regulatory function issues are identified through the Quality Assurance system while issues related to misconduct, ethics and disciplinary action are covered by the Disciplinary system. Both the Regulatory Committee and the Disciplinary Committee are independent of the management and Council of ICPAC, and can impose any conditions or penalties they consider appropriate. There is no distinction between disciplinary measures and sanctions for different types of entities. The disciplinary procedures of ICPAC are followed for each case, which is considered in its own merit. The progress of the administrative I&D process is reviewed on a monthly basis by the ICPAC Council. Wherever appropriate, ICPAC reports information to and liaises with other competent authorities and professional organizations on this area. National judicial system investigations and rulings take precedence over the ICPAC I&D process.
The institute reports that the system was reviewed in 2013 during the revision of ICPAC’s I&D Regulations to ensure that they continue to comply with the requirements of revised SMO 6. In addition, ICPAC raises awareness of the I&D system to the public and its members via a designated section on I&D matters on its website that was launched in 2015. The I&D system is planned to be updated in 2017 to incorporate any changes required in the amended auditors law.
The institute is encouraged to closely cooperate with the Cyprus Public Audit Oversight Board and the government as the responsibilities for the I&D system are being redefined and ensure that the resulting system continues to be in line with the requirements of SMO 6.
Current Status: Review & Improve
- SMO 7: International Financial Reporting Standards
ICPAC has no direct responsibility for the adoption of corporate sector accounting standards, but has a well-established process for supporting adoption and implementation of EU-endorsed IFRS.
The institute monitors the IASB work programs, and reviews and provides comments on exposure drafts and other pronouncements released by the IASB through the European Financial Reporting Advisory Group. ICPAC also disseminates updates on IASB information to its members and key stakeholders via email, its quarterly magazine, its website, and makes copies of the IFRS bound volumes available.
Furthermore, the institute ensures that initial professional development and continuing professional development programs include educational resources and courses on standard-related topics, and provides technical support to members on the implementation of the standards. To achieve this, ICPAC has entered into a collaborative agreement with the Institute of Chartered Accountants of England and Wales to provide its members with access to resources on accounting, auditing, and ethical standards through a direct line service called the “Technical Advisory Helpline.”
Current Status: Sustain
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.
