Instituto Guatemalteco de Contadores Públicos y Auditores

Member | Established: 1968 | Member since 1998

The IGCPA, established in 1968, is a professional accountancy organization with voluntary membership. The IGCPA sets ethical standards and investigates and disciplines its members in addition to promoting the adoption and implementation of international standards.

The IGCPA is a member of IFAC and of the AIC.

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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: 09/2021
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SMO Action Plan

Status of Fulfillment by SMO

• SMO 1: Quality Assurance

  There is no legal requirement to establish a quality assurance (QA) review system for all audits of financial statements in Guatemala. However, the Decree No. 72 of 2001 does empower the Colegio de Contadores Públicos y Auditores de Guatemala (CCPAG) as the regulator of the profession and, as such, it is taking steps to establish a QA review system. The timeline for the QA implementation remains unclear.

  Although the IGCPA has no legal authority to establish a mandatory QA review system, since 2014, IGCPA has supported the CCPAG to amend the Decree No. 72 of 2001 and accompanying regulations to allow for the creation of a QA review system. The IGCPA played a key role in promoting the adoption of a QA review system in line with the SMO 1 requirements by supporting the development of the CCPAG’s National Quality Control Board, which is expected to eventually carry out QA reviews in the jurisdiction.

  In 2017, the CCPAG signed a cooperative agreement with the French International and Development Partnerships Directorate (DDPI) to receive technical support in the design of a roadmap aimed at establishing a QA review system as well as training in the implementation of the ISQC 1. However, as reported by the IGCPA, the collaboration with CCPAG has stopped, and it is unclear whether the National Quality Control Board initiative continues.

  As the CCPAG’s National Quality Control Board is not executing its mandate, the IGCPA reactivated its initiative to develop a voluntary QA review system for its members who perform audits of financial statements. To achieve this, the IGCPA plans to develop a National Registry of auditors and audit firms that would participate in undergoing voluntary reviews. The IGCPA has outlined details within its Action Plan to implement an SMO 1-compliant QA review system, with reviews starting in 2021.

  As part of preparing for the establishment and implementation of the voluntary QA system, the IGCPA is working on raising awareness amongst auditors, disseminating information, providing training activities, and coordinating with regulatory entities—i.e. CCPAG, Tax Administration, the Superintendence of Banks, and the Securities and Commodities Market—to promote the benefits of a QA system. Ultimately, it is seeking all regulatory entities’ support in the establishment of a unified, mandatory QA system at the jurisdiction level that meets the revised SMO 1 requirements.

  IGCPA’s plans to operate a voluntary QA review system clearly serve the public interest and are aligned with best practice. During the next submission of its Action Plan, the IGCPA is encouraged to provide an update on its progress to develop and operate a voluntary QA review system. The IGCPA should continue using its best efforts to collaborate with other regulators and the CCPAG to promote and support the establishment of a unified, mandatory QA system at the jurisdiction level that meets the revised SMO 1 requirements.

  The IGCPA is encouraged to continue monitoring and preparing members for the changes from quality control standards to quality management standards that being proposed and reviewed by the IAASB.

  Current Status: Execute

• SMO 2: International Education Standards

  In Guatemala, universities, the Colegio de Contadores Públicos y Auditores de Guatemala (CCPAG) and some regulatory entities, have the leading roles in setting and implementing initial professional development requirements for professional accountants. These include earning a bachelor’s degree in accounting and at least two years’ practical experience. As an entity established by general consensus and with voluntary membership, its activities primarily include promoting the full adoption and implementation of IES requirements to the regulators. For example, the IGCPA has established a University Exchange Commission responsible for promoting the IES to universities and the CCPAG.

  In 2015, the IGCPA supported the CCPAG in the adoption of the IES requirements for all professional accountants; however, because the CCPAG lacks legal authority in this area, the IES are viewed only as guidelines for universities. Nonetheless, to further promote the adoption of the IES requirements, in 2017, IGCPA and CCPAG developed a gap analysis on the training of public accountants and auditors, which has been shared with the universities. As collaboration with CCPAG has not progressed since then, the IGCPA plans to review the diagnosis and update it against the requirements of the latest IES.

  The University Exchange Commission is leading an initiative with the universities to incorporate the revised IES requirements into their curricula and voluntarily participate in an IES certification process. In addition, the IGCPA reports that it is considering the implementation of a professional exam for candidates prior to enrollment in the IGCPA and plans, by the end of 2020, to modify its by-laws to enforce this as a mandatory requirement. Once the IGCPA requirements are implemented, the institute intends to promote the exam to the CCPAG as a best practice and encourage the CCPAG, as the mandatory PAO in the jurisdiction, to adopt it for any new members.

  To support members’ awareness and understanding of the standards, the IGCPA disseminates the IES on its institutional platforms. The institute offers CPD voluntarily in the form of seminars, workshops, short courses, and conferences. In addition, the IGCPA is offering certifications to professionals providing specialty services, such as, IPSAS and ISA.

  Finally, the IGCPA plans to coordinate with regulatory entities—i.e. CCPAG, Tax Administration, the Superintendence of Banks, and the Securities and Commodities Market—in addition to Chamber of Commerce to promote the IES requirements as part of each regulators’ registration requirements.

  The IGCPA efforts to promote the IES are commendable. As the CCPAG’s plans to adopt the latest IES requirements are unclear, the IGCPA is encouraged to adopt the 2019 IES requirements for its members where feasible, such as mandatory continuing professional development requirements that meet IES 7 and 8 and an entry exam for individuals seeking IGCPA membership that meets IES 6. In addition, as practical experience requirements are established by universities, the IGCPA is encouraged to promote their alignment with IES 5 requirements. The requirements could subsequently be used as a model or baseline for the CCPAG and other regulatory entities.

  During the next submission of its Action Plan, the IGCPA is encouraged to provide an update in regards to its plans to: (i) update the gap analysis against the 2019 IES and share these results with key stakeholders; (ii) develop a roadmap with regulators for bringing national educational requirements for all professional accountants in line with the 2019 revised IES, and; (iii) the implementation of a professional exam for candidates prior to enrollment in the IGCPA.

  Current Status: Plan

• SMO 3: International Standards on Auditing

  The IGCPA is not authorized to adopt auditing standards in Guatemala. The Colegio de Contadores Públicos y Auditores de Guatemala (CCPAG) is empowered to set auditing standards for its members. It has adopted ISA as issued without modifications and with the IAASB-stated effective date. The Superintendencia de Administración Tributaria and the Securities and Commodities Market require companies under their supervision to have their statements audited in accordance with standards issued by the CCPAG. Lastly, the Superintendence of Banks (SIB) requires auditors providing services to entities under its supervision to prepare annual audited financial statements in accordance with ISA. A modification has been made to ISA 700 for the entities regulated by the SIB to account for the differences in the accounting manual issued by the SIB.

  The IGCPA played an essential role in the standard-setting process by supporting the CCPAG in the adoption of ISA, which the CCPAG has adopted since 2007.

  The IGCPA has established a Standards Commission and reports that it monitors new and amended standards issued by the IAASB and disseminates information on updates to the standards through printed materials and its website. In addition, the IGCPA includes the newest/revised ISA in its continuing professional development activities and provides additional trainings, such as conferences, to different Guatemalan business chambers to enhance stakeholders’ understanding of the standards. The IGCPA states that it has developed practical implementation guidelines for its members as well.

  The IGCPA reports plans to work with the SIB to fully adopt ISA as issued by the IAASB and to create a National Registry of auditors and audit firms that would support the ongoing implementation of the standards through voluntary quality review inspections.

  The IGCPA is encouraged to continue promoting to the SIB the need to adopt the ISA as issued by the IAASB. In addition, if deemed feasible, it may be beneficial for the IGCPA, to participate in the international standard-setting process by providing comments on exposure drafts and other IAASB pronouncements.

  The IGCPA is encouraged to continue monitoring and preparing members for the changes from quality control standards to quality management standards that being proposed and reviewed by the IAASB.

  Current Status: Review & Improve

• SMO 4: Code of Ethics for Professional Accountants

  In Guatemala, the IESBA Code of Ethics has been adopted by the Colegio de Contadores Públicos y Auditores de Guatemala (CCPAG), whose mandatory membership includes all professional accountants. The CCPAG has established ongoing processes to continuously adopt and update its Code, so it remains aligned with the IESBA Code of Ethics. Additionally, the IGCPA is responsible for setting ethical requirements for its members, who join on a voluntary basis, and accordingly, it has adopted the IESBA Code of Ethics since 2012.

  To support the implementation of the Code, the IGCPA has carried out various support activities such as seminars and courses and publishing articles on the Code in its magazine and website. Additionally, the IGCPA reports that it has an ongoing mechanism to disseminate the Code of Ethics.

  If deemed feasible and relevant, it would be beneficial for the IGCPA to participate in the international standard-setting process by providing comments on exposure drafts and other IESBA pronouncements.

  Current Status: Sustain

• SMO 5: International Public Sector Accounting Standards

  The National Constitution of the Republic of Guatemala establishes the Accounting Administration Authority of the Ministry of Public Finance (MoF) as the accounting standard-setter for the public sector. Accordingly, the MoF has adopted IPSAS, via national standards, through Decree No. 109 of 2019.

  The IGCPA reports that it promoted and supported the adoption of IPSAS by contributing to consultation activities around the standard-setting process and participated in several meetings with the MoF. Subsequently, the IGCPA has supported the MoF with the implementation of IPSAS through several initiatives. These include: encouraging the MoF to sign an agreement with IFAC to reproduce and use the IPSAS; providing technical training to MoF staff; testing the application of IPSAS in the MoF’s information system; preparing a manual on policies and procedures for IPSAS, and preparing pro forma financial statements in accordance with IPSAS.

  Additionally, since 2015, the IGCPA has offered courses and conferences on IPSAS and provided training activities for its membership. The IGCPA offers certifications to professionals providing specialty services, including one in IPSAS. The IGCPA also reports that it monitors new and amended standards issued by the IPSASB and disseminates information on updates to the standards through printed materials and its website.

  If deemed feasible and relevant, it would be beneficial for the IGCPA, in collaboration with the MoF, to participate in the international standard-setting process by providing comments on exposure drafts and other IPSASB pronouncements.

  Current Status: Sustain

• SMO 6: Investigation and Discipline

  Investigative and discipline (I&D) requirements in Guatemala for all professional accountants are established by the Colegio de Contadores Públicos y Auditores de Guatemala (CCPAG). In addition, the IGCPA has established an Honor Tribunal to investigate and discipline its members who have voluntarily joined the institute and become subject to its rules and regulations. The extent of fulfillment of both I&D systems with the requirements of the SMO 6 requires further clarification.

  Since 2014, the IGCPA and CCPAG have reported that they are collaborating to prepare amendments to Decree No. 72 of 2001 to incorporate missing elements that would help to fulfill SMO 6 requirements, such as, no information about the types of misconduct; the system is only “complaints-based”; no link with the results of QA reviews; only professional accountants serve on the committee; the limited range of penalties; and results of the I&D procedures are not made publicly available, among others. The initiative was expected to be completed by 2021. Nonetheless, as of 2020, no actions have been reported.

  In 2020, the IGCPA carried out a comparison between its I&D system and the requirements of the SMO 6 and concluded that it misses the same elements of the CCPAG I&D system. It has outline steps within its action plan to address the identified gaps.

  I&D procedures that meet the SMO 6 benchmark are foundational to maintaining public trust and confidence in the profession. IGCPA’s system has gaps in this regard, and it is recommended that it invest its resources in strengthening its procedures and subsequently use its best efforts to advise and assist the CCPAG with strengthening its mechanism.

  Along these lines, the IGCPA is encouraged to continue using its best endeavors to update Decree No. 72 of 2001 to incorporate missing elements that would help to fulfill SMO 6 requirements. As all professional accountants must be members of the CCPAG to practice in Guatemala, this would significantly help align the jurisdictional I&D system with SMO 6 requirements.

  Current Status: Plan

• SMO 7: International Financial Reporting Standards

  Although the Colegio de Contadores Públicos y Auditores de Guatemala (CCPAG), the tax administration (Superintendencia de Administración Tributaria (SAT)), the Securities and Commodities Market, and the Superintendence of Banks (SIB) are the entities legally responsible for the adoption of accounting standards, the IGCPA actively participates and contributes to the standard-setting process of the CCPAG, and encourages the application of IFRS and IFRS for Small- and Medium-sized Entities (SMEs). The CCPAG has adopted IFRS; some regulators permit IFRS application while the tax administration requires other standards.

  The IGCPA has established an IFRS Standards Committee that is responsible for monitoring changes to the standards and pronouncements issued by the IASB, and sharing updates to the regulators.

  In 2020, the IGCPA reports that it is preparing a proposal to the SAT to update the Tax Legislation Decree to formally adopt the IFRS and IFRS for SMEs and avoid special purpose financial statements. To achieve this, the IGCPA plans to develop a reconciliation model between the Tax Legislation Decree and IFRS and IFRS for SMEs.

  To support its members with the implementation of the IFRS and other national accounting standards, the IGCPA provides CPD opportunities, disseminates IASB pronouncements, and collaborates with regional organizations such as the Group of Latin American Accounting Standard Setters (GLENIF) and the Inter-American Accounting Association to provide additional training activities.

  The IGCPA also provides technical support to the CCPAG’s representation in GLENIF and participates in the international standard-setting process by making comments to exposure drafts at the regional level.

  The IGCPA is encouraged to continue updating its Action Plan to demonstrate recent examples of its advocacy efforts with the Tax Authority and SIB to promote the full adoption of IFRS and IFRS for SMEs as the applicable accounting standards in the jurisdiction. Additionally, the IGCPA is encouraged to consider developing technical guidelines on IFRS and IFRS for SMEs to support its members with the implementation of the standards.

  Current Status: Review & Improve

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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.