Institute of Chartered Accountants of Zimbabwe
Member | Established: 1918 | Member since 1981
The ICAZ, established in 1918, is the oldest and the largest Zimbabwean professional accountancy organization. The institute strives to develop and promote best practices in accountancy, assurance and advisory services, business, and good governance. It does this by supporting its members—Chartered Accountants (Zimbabwe)—to provide high-quality services in the public interest.
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
Under the Public Accountants and Auditors Act 1996 (Chapter 27:12), as amended in 2015, the Public Accountants and Auditors Board (PAAB) is authorized to carry out practice reviews and inspections to monitor audit quality. The PAAB has assumed its role in carrying out quality assurance (QA) reviews since August 2012. Prior to 2012, ICAZ had carried out QA reviews through its Practice Review Committee (PRC) but has since discontinued conducting QA reviews as it states the QA review system introduced by the PAAB meets the requirements of SMO 1.
Since 2012, ICAZ’s focus has been to assist and support its members’ provision of services in compliance with relevant standards by providing continuing professional development (CPD) as identified by the results of the PAAB’s findings as well as its own internal monitoring of financial statements through its Accounting Procedures Committee (APC) and Auditing and Professional Standards Committee (ASPC). The ICAZ explains that its APC and APSC review a third of financial statements for listed companies to check on compliance with IFRS and ISA. A summary of findings are then communicated to preparers and auditors for them to note improvements in preparation of future financial statements. Auditors are given an opportunity to address the identified non-compliances and if there are severe non-compliance matters, these are referred to the institute’s disciplinary committee.
Additionally, ICAZ also states it raises awareness about the results of QA reviews among its members through publications of technical guidance papers in its newsletter and other training sessions.
ICAZ is encouraged to continue to monitor and support the implementation of ISQM1 among members when it becomes effective as of December 15, 2022. Resources on the quality management standards are available on the IAASB website.
SMO 2: International Education Standards
ICAZ is authorized to establish initial and continuing professional development (IPD and CPD) requirements for its members under the oversight of the Public Accountants and Auditors Board (PAAB) which is charged with prescribing the minimum qualifications, competency standards and requirements for registration of all accountancy professionals; accrediting institutions that provide accountancy qualifications and education; evaluating and monitoring the standards of qualifying examinations, courses, and training set or offered by professional accountancy organizations; and promoting the standardization of qualifying examinations on common subjects. Universities provide part of the IPD accountancy education as an accounting degree is necessary to sit for ICAZ’s Initial Test of Competence (ITC) in line with IES 1. ICAZ notes that it promotes the need to incorporate IFRS, IPSAS, ISA, and the IESBA Code of Ethics into the accountancy curriculum.
The ICAZ reports that it works to ensure that any new developments in the training and post qualifications programs for Chartered Accountants are consistent with all IES. This falls under the responsibility of ICAZ’s Examination Board and its Education and CPD committees. ICAZ’s education program—the Zimbabwe Certificate in the Theory of Accounting (ZCTA)—is fully aligned with that of the South African Institute of Chartered Accountants (SAICA), which, in turn, has reported that it incorporated the latest IES into its IPD requirements. ICAZ’s qualifying examinations, both the ITC and Assessment of Professional Competence (APC) tests, are outsourced from SAICA and are the same as SAICA’s qualifying examinations except for a modification of certain tax aspects to suit the local environment. The institute specifically notes that its final exam has been updated considering the revised IES to assess technical, analytical, contextual, and communication competencies. ICAZ states that it provides administrative assistance to students studying to qualify as Chartered Accountants, from the undergraduate level to the qualifying examination stage.
In May 2017, ICAZ introduced an e-writing pilot for its final examinations. As of November 2017, the online format is mandatory. Students are provided with the password to enter the examination a few minutes before the commencement of the examination and the exit password a few minutes before the end of the examination. No complains have so far been received from students on the format.
Additionally, ICAZ is presently sourcing for local exam setters and markers. It is envisioned that potential markers would undergo training to be certified and recognized as ICAZ markers. Similarly, exam setters would be requested to meet minimum stated requirements and submit sample exams which would be evaluated by a team of experts in South Africa. The institute is establishing a Qualification Capacity Building Committee to progress this initiative and localization of exams. ICAZ reports it is now marking the taxation section locally and is involved in setting and marking the remainder of the exam under the mentorship of SAICA instead of fully outsourcing these functions as previously done. ICAZ estimates that the institute will be capable of setting and marking its own examinations by approximately 2024.
In line with IES 5, candidates for the CA(Z) designation must also have three years’ practical experience. A new competency framework applies to all ICAZ students and trainees as of January 2017 which the institute reports is based on the revised IES. The Education Committee presented the new framework to ICAZ—accredited training offices’ (ATOs) representatives, emphasizing new competencies and expectations. Trainees must demonstrate proficiency with six technical competencies and four professional competencies with significant changes related to the practicality of tasks and skills as well as business ethics and assessing values. The Education Committee requires that all ATOs of ICAZ must be reviewed every three years to maintain their accreditation. Reviewers appointed by the Education Committee visit the firms to assess compliance of the firm in terms of adhering to the education regulations as laid down by ICAZ which reflect the continuously updated competency framework.
According to Karreman et al. (2013), ICAZ’s CPD requirements (IES 7 and 8) demonstrate a high level of alignment with the IES. ICAZ requires its members to complete cumulative 120 hours of CPD over a three-year period and members submit their completed CPD online. The institute develops a CPD calendar each year based on feedback from members, new developments, findings from technical committees, and pronouncements from standard-setting bodies. In response to the COVID-19 pandemic, the institute has been running webinars to offer online CPD opportunities to members.
ICAZ can utilize the IFAC Accountancy Education E-Tool to review the 2019 IES and share these requirements with relevant stakeholders such as universities and other professional accountancy organizations in Zimbabwe. It is recommended that ICAZ review and complete the IES Checklist developed by IFAC which may be useful in progressing with the adoption of the revised requirements of the IES, especially IES 2, 3, 4 and 8 that are effective as of January 2021
SMO 3: International Standards on Auditing
In accordance with amendments to its founding legislation, auditing standards adopted by the Public Accountants and Auditors Board (PAAB) receive legal backing. The PAAB has adopted all ISA and other pronouncements issued by the IAASB as issued, without any amendments or modifications.
ICAZ is an active supporter of the PAAB and supporting ISA implementation. It notes that through its Auditing and Professional Standards Committee (ASPC) it collaborates with the PAAB on any matters relating to auditing standard-setting and implementation and submits comments to exposure drafts from the IAASB. Of note, ICAZ reports it played a key role in supporting the PAAB to roll out the 2016 ISA and the new auditor’s report. ICAZ members were early adopters and implementers of the new report in 2015 in order ensure proper implementation in 2016 when the standards became effective.
To support its members with implementation of the standards, ICAZ regularly offers continuing professional development and training on ISA. The institute strives to incorporate new and updated standards into its scheduled programming along with promoting similar updates to university’s accounting curricula. In this regard, ICAZ notes that the latest ISA are incorporated into accountancy education from the undergraduate level all the way through its Certificate of Theory in Accounting. Lastly, it also indicates that it advises members of updates via email and technical publications in its newsletter.
IAASB has issued an exposure draft of the proposed separate standard for audits of Less Complex Entities. ICAZ is encouraged to participate in the public consultation process for this landmark new draft standard.
SMO 4: Code of Ethics for Professional Accountants
In Zimbabwe, both the Public Accountants and Auditors Board (PAAB) and its recognized principal and associate professional accountancy organizations (PAOs) are responsible for defining ethical practice and codes of conduct for registered persons and members, respectively. As a principal PAO, ICAZ reports that it has adopted the IESBA Code of Ethics without any modifications since 2010 for its members. It further states that its members are required to adhere to the latest version of the IESBA Code of Ethics as all revisions to the IESBA Code are adopted as published by the IESBA. In this regard, the institute notes that it has received permission from IFAC to reproduce and share the 2018 International Code of Ethics with its members.
ICAZ indicates that it supports the ongoing adoption and implementation of the IESBA Code of Ethics by organizing workshops for members and informing members and the public about revisions to the IESBA Code of Ethics. For example, in 2017, the institute organized two Chief Financial Officer (CFO) Forums that include sessions on ethical conduct and the Code of Ethics and in November 2017, held a workshop on changing work patterns and attitudes that emphasized expected ethical conduct of members. Further, in 2020 ICAZ held CPD sessions on Ethical and Effective Leadership in a time of Crisis. The institute also plans to introduce educational movies on ethics for students using ICAEW’s examples.
Furthermore, ICAZ notes that it is active at the international standard-setting level by providing comments on IESBA-issued exposure drafts when released and, in 2017, the institute participated in the IESBA’s “Professional Skepticism and Judgement” project. In addition, the CEO of ICAZ is a member of the IFAC Professional Accountants in Business (PAIB) Committee and, through his involvement on the committee, ICAZ has contributed to the development of the IESBA strategy.
As ICAZ seems to have developed and maintained ongoing adoption and implementation process related to the IESBA Code of Ethics, ICAZ may consider collaborating with PAAB as well as other PAOs in the jurisdiction to establish uniform ethical standards for professional accountants in Zimbabwe which should maintain alignment with IESBA Code of Ethics.
SMO 5: International Public Sector Accounting Standards
Public sector accounting standards are established in the Public Finance Management Act (Chapter 22:19) which requires public sector entities to be prepared on a customized cash-accounting basis. However, the Ministry of Finance and the Accountant General have decided to adopt IPSAS and the government is working to adopt a new legal framework that requires accrual-basis IPSAS for public sector entities. Implementation of accrual-IPSAS has already begun with local government authorities based on a phased plan and it is envisioned that the full implementation of accrual-basis IPSAS will occur in 2025.
ICAZ is actively involved in supporting the adoption process, preparing to support the implementation of IPSAS, and strengthening the public sector accountancy capacity overall. In 2009, it first established a Public Sector Committee (PSC) to address issues related to public sector reporting and provide training to staff at the offices of the Accountant General and Auditor General. With the establishment of a similar committee under the Public Accountants and Auditors Board (PAAB), however, most of the PSC members now sit on this PAAB Committee and the ICAZ PSC meets only to discuss issues they may deem are not being covered fully at the PAAB level. Through the PAAB PSC, ICAZ will submit any comments on exposure drafts issued by the IPSASB.
In 2016, ICAZ and the PAAB became beneficiaries of a capacity building project managed by IFAC’s PAO Capacity Building Program and funded by the U.K. Department for International Development. The project has two main components: establishing a project stakeholder advisory group for the adoption of IPSAS and developing a comprehensive roadmap to strengthen accountancy capacity in the public sector through a public sector qualification. The institutes have partnered with the Chartered Institute of Public Finance and Accountancy (CIPFA) to develop the public sector qualification that would be offered by ICAZ and would serve as the foundation of public sector education and support for high-quality implementation of the standards. ICAZ has been designated as the implementing partner to support the pilot of a public sector qualification once ready. ICAZ indicates that Phase I of the project which largely involved CIPFA and the PAAB is completed and implementation of Phase II is underway. Phase II involves accrediting public sector training offices and finalizing the training material.
Additionally, in 2016, the institute created a Public Sector Task Force to improve communications between the profession and the public sector. Overall, the task force acts as an advisor to public sector authorities on matters relating to public sector accounting and public financial management. ICAZ reports that it is this task force that is issues technical articles that are circulated to members and is involved in organizing continuing professional development courses on public sector accountancy topics. For example, the ICAZ Public Sector Summer School that focusses on discussing issues that are unique to the public sector and in 2017, 2018 and 2019, ICAZ has hosted Public Sector Conventions highlighting the importance of transparency and accountability for economic growth and providing technical updates on IPSAS and IPSAS implementation.
ICAZ is encouraged to continue its advocacy and support toward accrual-basis IPSAS adoption. ICAZ may also find IFAC’s Train the Trainers: Introduction to IPSAS resource helpful for training and educational activities it offers.
SMO 6: Investigation and Discipline
The Public Accountants and Auditors Act (Chapter 27:12), states that principal and associate professional accountancy organizations (PAO) are responsible, in the first instance, for the professional conduct of their members who are registered persons and each PAO may undertake disciplinary proceedings against such members and issue sanctions. In accordance with the Act, the Public Accountants and Auditors Board (PAAB) is responsible for reviewing decisions made by the PAOs and hearing any appeals.
In turn, ICAZ, as a principal PAO, has accordingly established an Investigations Committee tasked with investigating allegations which then refers cases to its Disciplinary Committee. In February 2018, ICAZ conducted a self-assessment of its I&D system against the SMO 6 requirements and indicated that since its last assessment in May 2016 it has made improvements in several areas. It had included two non-accountants to the Investigations Committee with an objective of having more non-accountants serve on the committee over time. It also has two non-accountants on the Disciplinary Committee, including a retired judge serving as chairperson. ICAZ has also began publishing a summary of investigations in its Annual Report and procedures on filing a complaint alongside the necessary affidavit to be completed are now posted on the ICAZ website to address gaps in raising public awareness about the system and publishing results of the proceedings. The institute still noted that gaps remained in administrative processes–such as a timeframe for disposal of cases. As noted above, ICAZ members who wish to appeal a Disciplinary Committee decision can do so through the PAAB. The PAAB’s QA review system is also linked to ICAZ’s I&D system when review findings relate to ICAZ members.
From January 2015–August 2017, ICAZ indicates that six cases were processed by both committees which all dealt with ICAZ regulations. In 2019–2020, three cases were brought to the Investigations committee. In case members wish to appeal any decisions, they may do so through the PAAB. Further, ICAZ affirms that the PAAB’s quality assurance (QA) review system is linked to ICAZ’s I&D mechanism when review findings relate to ICAZ members.
In reviewing the results of its self-assessment against the SMO 6 best practices, ICAZ is encouraged to consider actions aimed at addressing the identified gaps and include actions it will undertake in this regard. Additionally, ICAZ may consider sharing the SMO 6 requirements with other PAOs in the jurisdiction to enhance I&D systems for all professional accountants and/or may consider collaborating with PAAB and other PAOs in the jurisdiction to establish a single, unified I&D system for all professional accountants in Zimbabwe that is aligned with SMO 6 requirements.
SMO 7: International Financial Reporting Standards
In accordance with 2015 amendments to its founding legislation, corporate accounting standards adopted by the Public Accountants and Auditors Board (PAAB) received legal backing. The PAAB has adopted all IFRS and IFRS for Small- and Medium-sized Entities (SMEs) as issued by the IASB.
ICAZ is similarly involved in supporting the PAAB’s accounting standard-setting and implementation process as it is with auditing standards. Through its Accounting Procedures Committee (APC), it works closely with the PAAB and submits comments when requests are issued by the IASB. In particular, the APC has responded to recent exposure drafts on IFRS 9, amendments to IFRS 4, amendments to IFRS 10 and 28, and the annual improvements to the IFRS 2015–2017 cycle. The APC has also recently been involved in supporting the implementation of IFRS 9, 15, 16, 17 and IAS 21 and IAS 29 within the Zimbabwean market.
Among its members, ICAZ indicates that it supports implementation of the IFRS and IFRS for SMEs by holding regular training through its continuing professional development program and providing members with technical publications, such as PAAB-issued guidelines on IFRS for SMEs. In 2017, the institute offered continuing professional development education on common errors in the preparation of financial statements and updates to the IFRS and local tax issues. ICAZ members are also notified via emails and ICAZ’s e-newsletter on updates to the standards.
ICAZ notes that the uptake of IFRS for SMEs within the country is rather low and it states it is consulting with relevant stakeholders to promote the application of the standards amongst companies that meet the criteria to apply the IFRS for SMEs—primarily, non-public interest entities.
ICAZ is encouraged to provide more specific examples of how it may be engaging with stakeholders to promote the use of IFRS for SMEs.
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