|Project Name:||Assist & Educate Small & Medium Sized Practices|
|Status of Project:||Completed|
Regional - East Asia & Pacific
Country - Sri Lanka
|Focus Area(s):||Accounting education, training, and professional qualification
Adoption and implementation of international standards in accounting, auditing, and ethics
Institute of Chartered Accountants of Sri lanka
|When did/will the project commence?||2012-06|
|When was/will the project be completed?||2015-03|
|Project Objectives:||In recognition of the significant role that the accounting profession plays in supporting the economic advancements of Sri Lanka, the World Bank extended a grant of US $ 500,000 in April 2012 towards developing the core technical activities of the Institute of Chartered Accountants of Sri Lanka (CA Sri Lanka), including improving compliance with financial reporting, auditing and quality control standards in the private and public sectors.|
|Key Project Components:||Sri Lanka’s Small and Medium Enterprises (SMEs) play a significant role as the backbone of Sri Lanka's fast developing economy. SMEs are considered the growth engine of the country and they contribute significantly to the Gross Domestic Product (GDP).
Having understood the important scope SMEs play, a programme was launched under the World Bank fund to assist and educate Small and Medium Sized Practices (SMPs) across Sri Lanka.
SMPs play a significant role in the development of SMEs as the SME audits are carried out primarily by SMPs. Having recognized this important scope, CA Sri Lanka developed an audit tool kit and a training programme targeting SMPs to enable them to develop a deeper understanding of conducting an audit in compliance with the Sri Lanka Auditing Standards (SLAuSs) through explanation and illustrative examples.
The toolkit consisted of 3 volumes:
• Core Concepts
• Practice Guidance
• Small and Medium Sized Entity Audit Templates
The initiative helped SMPs to conduct high-quality and cost effective audits enabling them to serve SMEs better and in-turn the wider public interest.
Activities carried out under the component;
Customized audit tool kit to suit SMPs, updated regularly with global changes to IFRs
Developed a series of training courses for SMPs
Awareness created among SMPs on the new developments in the profession, while also rolling out the audit tool kit and training SMPs on risk based audits, and setting up QMSs
|Key Project Outputs:||SME Audit Tool Kit
CA Sri Lanka launched its Small and Medium Enterprises (SME) Tool Kit for 2014, an audit manual for Small and Medium Practice (SMP) accounting firms. The tool kit compiled by CA Sri Lanka comprehensively guides practices towards better financial consolidation. The first two copies of the tool kit were presented to Mr. Allen Warren, President of the International Federation of Accountants (IFAC) who was in Sri Lanka on the invitation of CA Sri Lanka in 2014. The second copy of the tool kit was presented to Mr. Sujeewa Mudalige, President of the Confederation of Asian and Pacific Accountants (CAPA).
SME Audit Tool Kit Workshops
Following the launch of the SME Audit Tool Kit, CA Sri Lanka embarked on a series of case study based workshops to increase awareness among practitioners regarding the application of the SME Audit Tool Kit. The case study based workshops facilitated SMPs to apply Clarified Auditing Standards for the audit of SMEs. The training included the new developments in the profession and training on auditing case study by using the SME Audit Tool Kit. The programme also covered aspects such as risk based audits and the use of the SME Audit Tool Kit. The workshop also enhanced the technical expertise and knowledge in conducting audits during the 2 day sessions for the purpose of delivering sustainable audit service to their clients. The workshops saw the participation of approximately 80 firms.
|Key Project Outcomes:||
This component supports the following activities: (1) Developing an audit tool kit; (2) Developing a short case study based training course; and (3) Creating awareness on the new developments in the profession, roll out the audit tool kit and train SMPs.
Tool Kit. The services of a local consultancy firm was procured to customize the existing tool kit to suit small and medium sized practices. The toolkit consists of 3 volumes: (1) Core Concepts; (2) Practical Guidance; (3) Audit Templates. Volume 1 and 2 are based on IFAC publication “Guide to Using ISAs in the Audits of Small and Medium Entities”. The revised toolkit was pilot tested in a few audit firms and finalized. The printed Audit Toolkit along with an electronic copy was distributed among the practicing members.
Training. A consultancy firm with international experience has been procured who developed a short case study based training course for SMPs. A group of potential trainers have also been trained based on the training material. CA Sri Lanka with support from the consultants are now in the process of selecting the trainers from this group based on an assessment of their skill levels. The selected trainers will conduct training programs for SMPs based on the audit tool kit and training materials.
|How was the project initiated?|| The activities that are supported by the proposed IDF are closely aligned with the World Bank's Country Assistance Strategy (CAS). The Bank's 2009-2012 CAS identifies improving the investment climate and strengthening transparency and accountability as key priorities, both of which are part of the broader development objectives of the proposed IDF.
The Report on the Observance of Standards and Codes Accounting & Auditing (ROSC A&A) for Sri Lanka was prepared jointly by the Bank and the International Monetary Fund (IMF) and published in May 2004. The report involved an assessment of existing practices of corporate financial reporting and analysis of effectiveness of monitoring and enforcement mechanisms
|Total project budget (in USD)||$500,000.00|