IFAC Senior Technical Manager Vincent Tophoff recently addressed good governance in the public sector at a breakfast panel in Chile held by the Comptroller General of Chile. The event was attended by governmental officials and other professionals working in governance and the public sector.

The presentation, “Good Governance in the Public Sector,” addressed the key challenges for governance in the public sector and how methods to avoid and solve them. Mr. Tophoff also discussed the IFAC-CIPFA publication, International Framework: Good Governance in the Public Sector.

IFAC Senior Technical Manager Vincent Tophoff was invited to give a presentation on risk management and internal control in the public sector to the US Interagency Council on Enterprise Risk Management at the White House Conference Center in Washington, DC. The audience was comprised of risk management and internal control managers throughout the various US federal departments and agencies, including the US Treasury and the Office of Management and Budget.

After four days of outstanding presentations and discussions, and the opportunity to meet many of you, it is a great honor—as the newly elected President of IFAC—to speak with you as we conclude this World Congress.

Before I begin, let me express my deep appreciation to Warren Allen, the 16^th President of IFAC, for his leadership and tireless work over the past two years.  We could not have asked for any greater dedication or commitment.  You accomplished much—and we thank you

You leave big shoes to fill … thankfully, I wear high heels. 

I also want to thank all of you: almost 4,000 delegates from 140 countries who travelled so far to be with us.  Your input, exchange of ideas, and thoughts about the future opportunities for the accountancy profession are what make a World Congress.

***

I hope you’ve learned a lot, been inspired with new ideas, networked professionally and made new friends from across the globe.  And for those of you headed to the Vatican tomorrow for the audience with His Holiness, Pope Francis, you undoubtedly will have yet another unforgettable moment here in Rome—as will I, especially since I need to make my remarks in Italian!

We, in the accountancy profession, have long understood that thriving economies, prosperity, good governance and peace are found in societies and structures that are transparent and accountable. 

Accountants play an essential role in society: we support civil societies, and we enable strong and sustainable nations.

The graciousness of His Holiness to invite us for an audience symbolizes the importance of our profession in the advancement and support of civil societies.

***

One thing that this Congress has reinforced for me is that the years ahead for our profession, like the years in the past, will be about how we navigate through our choices, challenges, and opportunities.  

I recently read Hillary Clinton’s new book, “Hard Choices”, where she described how she thought of her choices and challenges, as the US Secretary of State, in three ways —and I was reflecting that we could consider our way forward in much the same way.

1. Issues We Have inherited—like recent regulatory activity and its potential unintended consequences.
2. New (and often unexpected) Events and Emerging Threats—which could be the next corporate failure or financial crisis.
3. Opportunities—like those presented by embracing technology and integrated thinking to create possibilities for innovation, leadership and relevance.

This Congress shined a light on the many, many choices, challenges, and opportunities that we face—individually, for our national bodies, as well as for IFAC and the global profession.

So as we prepare to return to our home countries from this World Congress, there is much to consider—and quite valuable information and many different perspectives to influence our actions as we move forward. 

*** 

The first plenary of this Congress, Businesses Thriving in Disruptive Times, featured an impressive group of CFOs from British Telecom, EY, Royal Dutch Shell, and Yahoo.  They discussed the choices, challenges and opportunities that businesses will likely face, particularly the increasing pace of change.

They came from a wide variety of backgrounds, and brought different perspectives, but highlighted some common themes.  The big trends noted included:

• How the world is becoming more and more global.
• The increasing shift from the west to emerging markets.
• The proliferation of huge amounts of data and the speed of technological changes—which brings huge opportunities and risks.
• That growth and investments going forward will no longer be just a financial issue, but must equally consider the societal impact—and how results are moving from the business page to the front page.
• The need for robust training programs and learning infrastructure—and how critical continuous learning and sharing of best practices will be.
• They emphasized the importance of the finance team being IT literate—but they also underscored that technology tools are an enabler - not an end, but a means.
• In a similar vein, they highlighted that data is not knowledge. Rather, we need to help develop insights from the data, to help decision makers identify the problems, and the solutions. 
• And they talked about the fact that CFOs—and professional accountants—need to listen, understand the external environment in which they work, and be the voice of reason.

One of my key takeaways from the session—and something very true in my own personal experience—is the importance of being inclusive of different backgrounds and cultures, and creating value together. They pointed out that diversity, in and of itself, is useless.  Inclusiveness is the key—embracing the variety of opinions, views, and perspectives that inclusiveness brings—and how it will enable better decisions.

One phrase I heard in this session that I will certainly use going forward is “future proof.”  This has to do with not taking anything for granted, and being prepared for and anticipating what’s next.  Talking about “what’s next”—I was given this globe, created here this week—I believe it is the first 3D printed prop ever for a World Congress.

But I have to say that the most important thing I took away from this session was that the finance function—and the accountancy profession—is transitioning from the passenger or navigating seat… to the driver’s seat.  To do this effectively, we must build our careers on deep foundations. We must engage in continuous learning by constantly reading—seeking new approaches and solutions that keep pace with the ever-changing business landscape.

One of the ways that IFAC hopes to contribute to this challenge of continuous learning and sharing of ideas is through the new Global Knowledge Gateway, which was launched on the IFAC website earlier this year.

The Gateway is an exciting platform for your use—and for member bodies to also share and learn.  It has a wealth of success stories, lessons learned, resources and information. 

It was originally conceived for accountants in Small and Medium Practices and Professional Accountants in Business—to provide greater support in these disruptive times.  But we quickly found the application and benefit of the Gateway to be much broader.  Its benefit extends to the entire profession, and even beyond.

This initiative is a great example of how we can address challenges, capitalize on opportunities and make good choices in deploying our resources in the most effective and productive way. 

When you return home from this Congress, please take time to join the 81,000 unique visitors who have already explored the Gateway. Submit a suggestion.  Comment on a discussion. Read about a different perspective. Contribute to the content or share a best practice from your part of the world. We will all be better working together.

***

The second plenary was Enhancing Government Transparency and Accountability. It focused on the need for enhanced public sector reporting and financial management.

We heard that some countries have learned lessons from the sovereign debt crisis—even if they weren’t directly affected. China, for example, is working toward a more open and transparent system. For them, the crisis showed the importance of high quality information and the need to promote accrual-based government accounting standards. And, with 14 million accountants already, China has introduced policy measures to strengthen the profession.

Other countries—such as New Zealand and Canada—have long been role models in the area of government accounting. It’s no coincidence that both performed well during the financial crisis.

But, as the Assistant Minister of Finance of China so aptly put it, Rome was not built in a day. Many countries have a long journey to achieve transparency and accountability in the public sector.

This is evidenced by the fact that the world is still drowning in debt. Debt to GDP in the G7 has increased from 60% to 120% since 1991. Many governments still don’t understand what they owe now and what they will owe later, so they aren’t considering the long-term impact of political decisions. Corruption and fraud are still too easy to conceal.

The bottom line is that it all comes down to the numbers and disclosures that are complete, comprehensive, reliable, and up to date. Governments must be held accountable, the same way companies are. And politicians need rules that incentivize good behavior.

Good accounting by itself will not solve any problems. But it will enable good decision making. And good decision making is essential for economic stability and growth. As one speaker so aptly put it, “Accrual accounting is about telling the truth.”

As I said earlier, Rome wasn’t built in a day. But we must be relentlessly committed to building a more accountable and transparent world over the long term.

For a long time now, IFAC has led the charge of calling for governments to ‘get their numbers right’.  We believe this is the #1 public interest issue for the profession.

Under Fayez’s leadership, IFAC has launched an initiative called Accountability Now.  This is a campaign, not a project.  Along with a wide range of stakeholders, we will intensify our efforts to promote awareness at the global and regional levels and help governments to move beyond commitment to implementation.

Of course, in order to successfully implement, governments must have adequate technical skills. IFAC has long been involved in PAO development and the development of the profession to benefit both the public sector AND the private sector. 

Let me pause here and tell you a story—a true story and an inspiring story.

At the end of Rwanda’s civil war, in which vast numbers of educated middle-class people were simply wiped out, the World Bank estimates that in 2008 there were only 45 accountants left in the country. 

This tiny number of accountants had no professional accountancy organization to support them.  It was a non-existent profession in a country that was itself barely surviving itself.

And with no accountants to provide assurance on the financials of any organization, it was almost impossible for Rwanda to attract much needed foreign direct investment.

Fast forward just 8 years.

This year, the 45 has become 285 registered accountants, supported by the Institute of Certified Public Accountants of Rwanda—ICPAR.  As this professional body has grown, in Rwanda today there is a government committed to the development of the profession, there is rule of law, there is peace and there is growing prosperity fuelled by growth rates that are among the best in Africa and far ahead of the developed world.

I’m particularly proud of IFAC’s work and that of our friends at the Institute of Certified Public Accountants of Kenya, the sponsoring body of ICPAR.  Ladies and gentlemen, Rwanda’s profession has only really just gotten back on its feet; it’s making great progress but of course it still has a journey ahead of it. 

I was delighted when ICPAR was admitted as an IFAC Associate Member in 2012. Is there anyone here from Rwanda?  Could you please stand? And recognize that I have highlighted just one of the success stories in the capacity building area.

While we’re talking about the region, it’s worth also noting the Mutual Recognition Agreement between the national PAOs of the East African Community.  Tanzania, Kenya, Uganda and Rwanda have created a regional platform for professional knowledge exchange and support.

To advance our capacity-building success, IFAC signed a historic memorandum of understanding with key groups in the international donor community. This agreement is referred to as “MOSAIC”—an acronym for Memorandum of Understanding to Strengthen Accountancy and Improve Collaboration.

Out of this agreement, we built (and just launched at this World Congress) the MOSAIC website, which will provide a “marketplace” to match the developmental needs identified by national professional accountancy organizations with the funding interests of potential donors.

Also out of this agreement, IFAC was granted almost 5 million pounds by the United Kingdom’s Department for International Development to support the establishment of professional accountancy organizations in 10 developing and fragile states over 7 years.

I want to thank Her Majesty’s Government and Secretary of State for International Development, Justine Greening—herself a professional accountant—for supporting this ground-breaking work. And I want to acknowledge IFAC’s Member Bodies in the UK for making DFID aware of the importance of the profession in developing countries. 

And now, I am delighted to announce the first three countries to be supported by DFID’s grant. They are:  Ghana. Rwanda. And Uganda!

Ladies and gentlemen, Accountability Now and PAO development are exciting initiatives. My challenge to you is to join us. Encourage YOUR governments to embark on the journey toward accrual-based accounting and budgeting.  Start a proper debate. Call on your finance minister. Raise awareness. Build a coalition. Help strengthen your PAO or regional organization by volunteering.  Encourage your PAO to help develop another PAO through mentoring, twinning, or other capacity building programs.

Together, we can advance the cause of good accounting… transparency and accountability… good decision marking… and economic growth and stability.

***

The final plenary focused on Integrated Thinking. We heard exciting developments from companies that are implementing integrated thinking and reporting to create sustainable value and drive performance. This is very much a strategic issue going forward.

We heard how society’s expectations of corporations and their actions have changed. This has led to organizations needing to respond to a wider set of risks—such as water scarcity and climate change. In addition, intangibles—such as relationships, intellectual and human capital—make up an increasing proportion of a company’s value. And they also determine their ability to create value in the future.

In response, organizations need to become more transparent and rethink their approach to reporting so that it’s more useful to stakeholders and the companies themselves. They need to present a picture of total value creation. And they need to provide a more accurate reflection of the impact they are having on society—including communities, suppliers, governments and employees. But they also need to change their thinking… and their behavior.  They need consider their resources… their relationships… their risks… and their opportunities-- in strategy and daily management. An example that really brought this home was given by Gold Fields’ CEO, Nick Holland, where we saw that 6 of the top 10 risks on their risk register were non-financial, or “soft issues.”

Intergrated thinking and integrated reporting are a prerequisite for good corporate governance. And connecting financial and non-financial information leads to more effective performance management.

As the panel told us, to be successful and sustainable, integrated thinking has to become part of a company´s DNA to help reshape thinking and relationships.

IFAC has long supported the International Integrated Reporting Council and, in September, we signed a Memorandum of Understanding to support the adoption of the IR Framework—which was launched last year.

This is the future of corporate management and reporting, and the accounting profession has a primary role to play. Your leadership in this area is going to be vital in taking that message to your countries.

I challenge you to be an active participant in advancing the IR Framework, explaining how business strategy, governance, performance management, sustainability are linked. The groundswell for IR and integrated thinking is rising quickly. It’s time to get on the train.

***

Ladies and gentlemen, as we move forward over the coming years, some things we do may make headlines. But most of the things we do will be more about shaping trend lines that will impact our world for future generations.

As Goethe once said:

“Knowing is not enough; we must apply. 

Willing is not enough; we must do.”

We must not only consider what we have learned here this week and have good intentions. We must also be intentional and take action.

Over the past several days, there were 34 sessions and over 200 speakers.  We heard valuable information. Different perspectives. 

There is much to consider.  I urge you to carry this experience home with you. To participate. Get involved. Take action.

Our choices and challenges, and how we handle them, will help shape the people we become—and the profession we lead. 

Individually we may be ordinary people, but together we can accomplish extraordinary things.

Thank you.

Mr. Luigi Casero,

Our host, CNDCEC President, Gerardo Longobardi,

Guest Speaker, Mr. Vicenzo La Via,

WCOA 2014 Organizing Committees particular thanks to IFAC management and staff,

IFAC Past Presidents: Bertil Edlund, Rene Ricol, Fermin Del Valle, and Goran Tidstrom,

Distinguished guests,

Ladies and gentlemen,

Good evening.

Before I begin, I’d like to note the passing in 2011, of Peter Agars an IFAC Past President, a regular World Congress attendee together with his wife Averil.  Although Peter is no longer with us, his son, Kent, also an accountant, has joined us here in Rome maintaining the Agars family’s long association with our World Congresses. 

***

On behalf of the International Federation of Accountants, IFAC, it is my honor and great pleasure to welcome you to Rome for the 19^th World Congress of Accountants.

We gather here on the 110^th anniversary of the first World Congress, held in St. Louis, Missouri, in the United States in 1904.

But that inaugural event is scarcely comparable, both in attendance and influence, to its modern counterpart.

At the turn of the 20^th century, it was known as the “Congress of Accountants” and was part of the 1904 World’s Fair. Historical records tell us that only 81 people attended and historians doubt whether it was a truly international event. Some, like J.M. Samuels, writing in The Accounting Historians Journal, have described the “slight international involvement” as “little more than window dressing.”

Compare that to this week’s attendance: More than 3900 delegates from 140 nations and all continents. Certainly, the modern World Congress of Accountants leaves no doubt this is a significant global event.

I have heard this event called the “Olympics of the Accountancy Profession,” perhaps because it is held once every four years, but I submit to you that it is collaboration, not competition, that brings us together. But, similar to the Olympics, we will actively celebrate. We will celebrate what we, as a profession, mean to the global community we serve.

***

The theme of this conference, “2020 Vision: Learning from the Past, Building the Future,” reflects the idea that we have come here to communicate and collaborate with others, sharing our past experiences and ideas for the future.

The experiences of our profession range from the days of Luca Pacioli’s handwritten ledgers to technology advances like cloud computing and 3D printing. But in coming here, each of us realize we must look beyond today to foresee how our profession can sustain and enhance its relevance tomorrow.

Even this venue, the Parco Della Musica, mirrors the theme of this Congress. This modern, 21^st century facility shares a city with structures thousands of years older, yet it is creating its own history as one of Europe’s most visited music facilities as well as a world-famous venue for international events like this.

And, to further underscore this theme, during the construction of the foundations for this magnificent facility, the remains of a sixth century BC villa were unearthed. The plans for the concert halls were modified, so that they could be built up and around the ruins, and so that the ruins could remain visible. They became an integral part of the project… the remnants of the ancient past intertwined with this futuristic structure.

I invite you to join us this week as we look at the intersection of history and what’s to come—and as we learn from the past and build the future.

Some might ask “What relevance do the ruins of an ancient society have to us who live in a modern, air-conditioned world of gleaming high-rise buildings?”

As we gather here in Rome, we walk in the footsteps of an ancient yet sophisticated civilization. That civilization brought us innovations still in use today, like concrete, newspapers, a government system that subsidized education, food, and other needs, and a system of roads and highways that allowed travel over great distances.

Historians have researched the reasons behind the decline of the mighty Roman Empire. Foremost among these, they found, were economic troubles, public sector overspending, and government corruption.

***

In 2014, more than 1,500 years after the fall of Rome, these issues still plague us: The aftershocks of the financial and sovereign debt crises are still being felt. More than six years later, nations remain in recession and governments still struggle with massive debt, high unemployment rates, and anemic economic growth.

And sadly, in nations where aid and investment is needed most, too much of it is lost due to shadowy and secret dealings.  Without doubt, there is a need for greater transparency and accountability.

Strengthening the accountancy profession in these nations and regions helps to combat corruption and waste. It can help curb overspending. It fuels economic development and growth.

So, truly, our vision for the future is not just for the accountancy profession—but also for the global business environment in which we operate, the prosperity of the economies we serve and ultimately the reduction of the incidence of poverty. 

***

Today, we commence a quadrennial event that provides an opportunity to hear from dignitaries of the finance and business community… speakers that represent some of the brightest and most innovative minds, not just from the accountancy profession, but also from business and industry, government, and global organizations.

We will have the opportunity to share ideas and best practices with accountancy professionals from all corners of the globe, and debate and discuss the trends, opportunities, and challenges of our modern profession. Many of you will leave this Congress with new thinking or with newly found access to resources. Hopefully all of you will leave with new and valuable professional contacts gained through the networking opportunities this event provides.

This Congress’ plenary sessions—focusing on businesses thriving in disruptive times, enhancing government transparency and accountability, and integrated thinking—provide information and expertise to help us find solutions to the challenges we face today. Similarly, the concurrent sessions deal with key issues in our profession such as ethics, capacity building, education, financial reporting, assurance, and business advisory services. These sessions promise to be informative, interactive, and innovative and I personally look forward to attending them.

So, as we begin this Congress, in a spirit of gaining inspiration from the past to build a promising future, I invite you to consider the following three questions:

• Firstly, How can we, the global accounting profession, continue to contribute to economic growth and stability?
• Secondly, How can we take on a larger role and leverage our talents and experience across the private- and public sectors?
• Thirdly, How can we remain leaders in areas like ethics and continue to uphold the integrity that is a hallmark of our profession? 

***

As I mentioned previously, one of the legacies of the Roman Empire was its highway system, and some of you may be familiar with the expression, “All roads lead to Rome.”

Today, I say “All roads lead from Rome.” I challenge each of you to use this World Congress of Accountants as a starting point from which your continued development as a professional accountant—and our future progress as a global accountancy profession—can be measured.

Thank you for joining us here at this important event in this historical city. It is my sincere wish that your experience here is a productive and rewarding one.

Thank you and enjoy the Congress.

IFAC Deputy Director Kelly Anerud moderated and served as a panelist in a session entitled "Translating International Standards and Guidance: Best Practices and Tools to Achieve Quality Translations" on November 12, 2014, at the World Congress of Accountants 2014, in Rome, Italy.

The session also included presentations by Mariarita Cafulli, head of the Consiglio Nazionale dei Dottori Commercialisti e degli Esperti Contabli Translation Department, Javier Quintana, secretary of the Ibero-American Cooperation Framework (IberAm Project) and CEO of the Instituto de Censores Jurados de Cuentas de España, and Hilde Blomme, deputy CEO of the Federation of European Accountants (FEE). 

Former International Public Sector Accounting Standards Board member Anne Owuor was a panelist at the International Conference on Professional Ethics and Public Sector Accounting held July 29-30, 2014, in Lilongwe, Malawi.

IFAC President Warren Allen provided an overview of key IFAC activities and issues as a featured speaker at the AICPA Fall Council Meeting on Sunday, October 19, at the Westin Copley Plaza in Boston, Mass. 

Good afternoon and thank you. It is an honor and a privilege to be joining you at this 2014 Fall Council meeting.

I wish to acknowledge and thank a few people before I begin: to AICPA Chairman Bill Balhoff, Immediate Past Chairman Rich Caturano, Vice Chairman Tommye Barie, and President and CEO Barry Melancon for extending to me the opportunity to talk to you all today.

I’d like to offer my appreciation for the knowledge AICPA has invested to enhance and advance the accountancy profession in the United States and globally, throughout its own, long history.

With more than 400,000 members in 145 nations, AICPA is IFAC’s largest member body. And that, of course, is just the beginning of the ties that unite us.  AICPA members continue to make invaluable contributions to IFAC, including former AICPA Chairman Bob Mednick, IFAC Past President Bob Bunting, current IFAC Board Member Bob Harris, and Greg Anton of the Nominating Committee. Additionally, AICPA is well-represented on IFAC’s committees and the independent standard-setting boards, IFAC supports. And let me offer my congratulations to Chuck Horstmann for his recent appointment to the Public Interest Oversight Board, which will benefit by his depth of knowledge in professional and regulatory matters.

Two years ago, my predecessor Goran Tidström stood before this Council in Florida to report that your former Chair, Olivia Kirtley, had been recommended by the IFAC Board as the next Deputy President.

In less than a month, I will hand over the presidency to Olivia, and I know—as you do—that I will be leaving IFAC in the safest of hands. Olivia is the first IFAC President to have held just about every corporate governance position there is. She knows first-hand what business and industry needs and I’m truly delighted that she’s taking the helm. She has been a great support to me during my presidential term and has been responsible for leading several key IFAC projects over the past two years.

And while we’re on the topic of our respective ties, I also want to highlight something really important to me, to you, to our profession—the role played by volunteers.  I know I am preaching to the converted in this room, but this profession marches on volunteerism.

I am consistently delighted—and have been throughout my career—to note that accountants and auditors value their profession so much that they serve it willingly and graciously on myriad of boards, committees and councils.  We owe all of you and these other outstanding individuals a debt of gratitude.  It’s not easy to leave the day job and family life to travel—often great distances—to attend meetings voluntarily, but they do. Olivia, Bob Harris, and Greg Anton, , and I’m sure many others from AICPA’s immediate and extended family do so, and have done, at IFAC.  And, Bill, I know you will recognize this same outstanding spirit woven throughout all the AICPA’s activities too.

I wish to share with you today five of IFAC’s current activities that I am sure will be of interest:

Supporting Standards Development

Ladies and gentlemen, as you know, one of the most important roles IFAC plays is supporting the work done by the independent, international standard-setting boards for:

• Auditing and Assurance
• Ethics  
• Public Sector Accounting and
• Accounting Education

Our support allows these boards to develop high-quality standards based on input from all interested stakeholders – including the profession – while preserving their independence.

This support is supplemented by active input into standard setting from IFAC’s Small and Medium Practices and Professional Accountants in Business Committees, which strive to represent these two important constituencies and ensure their views are heard.

When I took office in 2012, my top priority was to support these boards and to support IFAC’s mission to contribute to the development, adoption, and implementation of high-quality international standards and guidance.

You don’t need me to remind you of what the world looked like back then, four years into the biggest bank bail-outs the world has ever seen, and with sovereign risk in Europe and the threat of global contagion through the roof.  

The urgency of the work of those boards was manifest. And moreover, it seemed like—for the first time—there was political appetite for global standard setting in both the private and public sectors.  The G-20 finance ministers, in their communique last year, even went as far as calling for transparency and comparability in public sector reporting, and urging IFAC’s good friends at the IMF and World Bank to further explore the issue.

As we survey the global economic scene right now—with European banks still filing for bankruptcy or failing their current stress tests, and the IMF warning of a triple dip recession in Europe… interesting I read the latest Economist on the plane yesterday and an article is predicting Germany is currently in recession…no sign of Washington doing anything meaningful about US debt…instability in the Middle East and Ukraine… and the lingering effects of the sovereign debt crisis in nations like Argentina—there’s much to keep policymakers awake at night.

So, let’s make no mistake. The urgency for global reform is now arguably more important than it was a couple of years ago.

As IFAC’s latest G-20 submission issued last week, highlights, there is a fundamental need to reignite that flame called reform. Momentum seems to be stalled.  And—perhaps worse—as some governments have dragged their heels, others have decided not to wait and have acted unilaterally with extraterritorial impact.  Instead of smoothing the playing field, it’s becoming more—not less—uneven. This will make it harder to coordinate a global response when the next crisis blows up.

Now, more than ever, we need consistency and comparability, we need global will and no small measure of passion to see the job through.

In my role as IFAC President, I have got to know the heads of the four independent standard-setting boards and many of the people who sit on them.  They are passionate.  They are committed. 

These boards are intrinsic to the global public interest. In a world beset with uncertainty, some of which I just outlined, they develop high-quality standards that enhance reliability, consistency, and comparability. The standards they create are a vital part of what we know as the “financial reporting supply chain,” which powers the capital markets, as well as foreign direct investment. They instill ethical behavior. They help small- and medium-sized companies—the engine-room of economic growth—access finance to help them grow. And, they provide an avenue for enhanced government transparency and accountability.

And in terms of our profession, they support high-quality, consistent practice and mobility.

This hive of activity dedicated to the public interest is an outstanding model, into which the profession has poured extraordinary resources, thought, time, energy and a passion for excellence.

The model has utilized the profession’s essential technical expertise to create high-quality standards that really matter, that can be adopted and used in a practical and cost effective manner, that can be implemented within the regulatory and legislative requirements imposed on the corporate sector, and that are broadly accepted and recognized globally.   

It’s actually—I think—an extraordinary achievement, so naturally I’ve been delighted to see that the several reviews of the model, by the Public Interest Oversight Board and the Monitoring Group, have found it is robust and working effectively, sure with a few suggestions for improvement.

Yet, we continue to face challenges.  Some regulators and other organizations continue to criticize the model and perpetuate the notion that the “profession is setting its own standards” and that the standard-setting boards are not sufficiently independent of the profession.  These criticisms are unfounded and often based on a lack of understanding of the model—which provides for a balance of practitioners, non-practitioners and public members on each board, extensive opportunities for public and regulatory input into the standard-setting process, and involvement, via advice and oversight at the level of the PIOB and Monitoring Group. Frankly, criticizing a model in which the regulators themselves actively participate, without articulating specific concerns or proposing any alternatives just doesn’t make sense.

We know that the standard-setting arrangements are robust… that there are strong safeguards that protect the independence of the boards… and that the accountancy profession must remain involved in standard-setting so that the standards are practical and can be implemented globally. IFAC will continue to work to improve understanding of the standard-setting process and mitigate any misperceptions, so that this shared standard-setting model can continue to operate in the public interest.

Global Representation and Advocacy

Speaking on behalf of the profession’s involvement in standard setting is just one area of IFAC advocacy.  One of our essential roles is to convene topical debates and sustain discussions on trends and emerging issues.

IFAC has a unique and influential voice. We promote the views of our profession, doing so with care and judgment—and always in the public interest. Sometimes, we use our global voice to highlight issues and ask questions. We often strive to leverage our position and our convening power to join with like-minded stakeholders to take part in a common initiative, and we leverage our connectivity across countries, governments, businesses, and markets.

Globalization has transformed the accountancy profession and the world, and we must engage in debate and dialogue with global policymakers and regulators.

One of the items high on IFAC’s agenda is global regulatory convergence.

About a year ago during a presentation I gave in Singapore, I quoted Patricia Cochran, the former CFO and VP of Vision Service Plan, and a former AICPA Board member, who said, “Further convergence of corporate governance and other regulations between states and countries would take most of the complexity and costs out of compliance.”

Patricia had been interviewed as part of a global survey conducted among IFAC Member Bodies and what she said illustrates why IFAC and its members must continue to press for global regulatory convergence. It’s a key element of our G-20 submission this year, in which we called for a re-ignition of the momentum and goodwill that surrounded convergence discussions immediately after the global financial crisis.

Regulatory convergence holds the potential to remediate problems highlighted by the global financial crisis and the potential to create stability and prosperity far beyond it. 

Without the support of politicians, governments, regulatory bodies, and professional accounting organizations at the national and international levels, we are left with a patchwork of different regulatory arrangements in different jurisdictions, creating unnecessary costs and uncertainty for Patricia and Vision Service Plan, not to mention the rest of us.

These differences limit the type and effectiveness of responses that governments, central banks, and regulators could take to address the problems created by the crisis. But more importantly, it creates uncertainty that erodes business confidence, chips away at economic stability, and corrodes ambitions for a sustainable recovery.

Another area where we’re seeing this patchwork of different regulatory arrangements is the push for mandatory firm rotation in Europe, India and other jurisdictions.

While some argue this is a potential solution to breaking what one Indian business publication called the “auditor-client nexus,” we are worried about the potential impact mandatory firm rotation may have on US and other non-European based companies with subsidiaries in these jurisdictions. This has the potential to give rise to significant practical issues.

IFAC believes that regulatory convergence is critical for the evolution of a sound, global economic system in the 21st Century. It’s clear that the AICPA shares this belief, evidenced by its advocacy on legislative matters that affect the accounting profession and its work with regulatory agencies to help promote sound policymaking.

IFAC will continue to urge the G-20, IFIAR – the group of global audit regulators – IOSCO – the group of global securities regulators – and the Financial Stability Board, to fully commit to promoting and enacting global regulatory consistency and evidence-based regulatory reform.

Regulations are an important part of the “financial reporting supply chain”—but each element of the chain is vital, and each must examine its role and responsibilities and strive for continuous improvement.

On a trip to China one year ago, I met with the Minister of Finance, who expressed his government’s concerns about the quality of the preparer community and the Chinese profession’s effort to bring an estimated 1,000,000 accountants under the auspices of a professional accountancy body.

This challenge to increase quality and capacity will only intensify in China and elsewhere, and ensure that preparers are competent and qualified.

More recently, in Japan, Hong Kong and Singapore, we consistently heard from securities regulators and other stakeholders about the need to improve corporate governance and strengthen the roles of Audit Committees. The US profession has been most effective in these areas and I am sure your experiences will be of huge benefit to many jurisdictions. 

All of these aforementioned areas contribute to high-quality financial reporting, which in turn contribute to the health and stability of the global financial system. I know that Olivia with her experience and background in corporate governance will also be making these topics a key focus area for her Presidency.

Enhancing Organizational Reporting

High-quality financial reporting is of course vitally important. But investors and other stakeholders are telling us the current model is not fit for purpose. This is a telling commentary on the principal output of our labors. They now are looking beyond the balance sheet as integrated reporting emerges as a major initiative to promote transparency and accountability and enhance investor and stakeholder confidence.

Your President and CEO Barry serves on the International Integrated Reporting Council.

As your IFAC President, I have also served on the IIRC.

I know you joined us in applauding the December 2013 release of the IIRC Framework, which represented a major advancement, laying the foundation for enhanced corporate reporting and enabling companies to better communicate how they create value over time.   

While integrated reporting can have a transformative effect on corporate performance, any transformation will require a continued commitment and a long-term view of success. With the release of the framework, it is up to us as professional accountants to move the process forward, by being active in encouraging implementation. I know the AICPA is committed to this in many ways, including developing important resources like “Integrated Reporting: The Next Step in Corporate Reporting,” a video webcast.

There is, and will continue to be, a real need to communicate this new approach to business reporting on a global level. The accountancy profession has an amazing opportunity to rise to this challenge. If we do not, “someone else will eat our lunch”. This involves IFAC, regional, and national professional accountancy organizations, accounting firms, and professional accountants.

Recruiting the Best and Brightest

As your IFAC President, I have given many presentations and speeches. In nearly every one, I take a minute or two to discuss an issue that is, as they say, near and dear to my heart, and I know yours as well. That issue is the continuing need to recruit and retain the best and brightest in our profession.

In nations large and small, developed and emerging, demand outstrips supply. This was the subject of a recent CGMA Magazine article, “On the Road,” which addressed the issue and asked the question: “As organizations look to expand in emerging markets, they are increasingly faced with a dilemma. Should they compete for finance managers from the local talent pool? Or should they send somebody from the home office to work abroad?"

One nation where organizations face this question is China. During one of my visits there last year, I had the privilege of meeting with accounting students and I conveyed to them the opportunities that lay ahead in this global economy and how the accountancy profession offers global mobility, particularly with the adoption and implementation of international accounting standards.

Diversity and inclusion is an important part of attracting and retaining the best and brightest. The AICPA has done a masterful job in this area, and I know that the global profession can learn from the example you have set—including your recent partnership with Howard University  to educate African-American and Latino students about the important role accountants play in society as well as the opportunities available within the accountancy profession.

Building Capacity

In parallel to the AICPA’s good work, IFAC is also working to educate people all over the world about the important role accountants play.

Collectively, we must do a better job of explaining how the accounting profession contributes to the global economic infrastructure—by producing high-quality financial information that governments, investors, businesses, and the development community need to make sound financial, management, and policy decisions.

In some countries, we need to go further. Through our Professional Accountancy Organization (PAO) Development Committee, IFAC assists emerging and developing PAOs, helping them to become “centers of excellence,” ready and able to assist governments, regulators, and other stakeholders, with sound public policy guidance and advice on accountancy-related topics.  And I am pleased to note that AICPA is well represented on this committee. For many years AICPA’s Gary Scopes played a pivotal role on this committee.

Strong PAOs set the bar for the behavior and practice of accountancy professionals and enhance quality assurance, investigation and discipline. They also work with regional organizations and regulators to enhance the implementation of international accounting standards.

Let me give you just one example of success in this area. 

In 2007, the World Bank estimated that Rwanda had less than 50 accountants in the entire country. The profession was functionally non-existent after years of civil war.  After years of work and partnership, in 2012 IFAC admitted the Institute of Chartered Practicing Accountants of Rwanda (ICPAR) as an Associate member.

Today there are almost 300 accountants in Rwanda and they’re helping support civil society, providing assurance on the financials of public and private institutions that are essential to the nation’s growth and attracting foreign direct investment.

Rwanda today has: Rule of law, Economic growth rates we can only dream of, actively engaged citizens, and, an accountancy profession growing in skill and professionalism, supporting transparency and good governance.

You might ask: Why on Earth should an accountant in Wellington, New Zealand, or indeed, Columbus, Ohio, care whether there’s an accountancy profession in Rwanda? It’s really simple.

Leaving aside the obvious point about a strong desire to help a fellow human help themselves, instability is the enemy of progress and growth. Failed or failing states anywhere in the world today are a direct threat to economic and social stability in the developed world. Turn on CNBC and you’ll watch in real-time as the US stock market prices-in risk and failure when shots are fired in far-flung places. And, take a look at the Middle East and West Africa right now. And now imagine what a prosperous, stable, outward looking Middle East and Africa could do to support global economic growth.

Whether it’s this hemisphere or beyond, we all have a role in helping nations build strong accountancy professions.  The anecdotal evidence is compelling in this regard. Strong accountancy professions support strong economies.

IFAC recently received some £4.9 million in funding from the UK Department for International Development to help strengthen PAOs in Asia, the Caribbean, the Middle East, and North Africa. We’re very excited about this ground-breaking agreement, and we are encouraging all our member bodies to help and support us in this vital work.

And while IFAC is dedicated to building capacity at the global level, we recognize that growth must also take place at personal level. 

Today, professional accountants navigate through an increasingly complex international landscape, where computing power grows exponentially every year, an iPhone holds more memory than the guidance computer used on the Apollo missions, and the Internet connects people around the world.  I am particularly looking forward to this afternoon’s session on Big Data.

In this environment, I am grateful that ours is a profession that has long-embraced the concept of life-long learning and I’m delighted to see the emergence of innovative professional designations, recognized worldwide, such as the Chartered Global Management Accountant (CGMA). 

The CGMA designation provides the tools and resources that support competency and drive success, and holds the promise of changing the market for accountants working in business and government.

Ladies and gentlemen,

I have enjoyed enormously my time as your IFAC President. It’s been an extraordinary privilege to serve this profession, it is a great profession and I have made some strong friendships here at the AICPA over the years.

Helen and I are now grandparents, and one of the things we are looking forward to most is spending time with our active and globally-aware  grandchildren. 

In future years, those little bundles of energy might ask their Poppa what they should be when they grow up. Perhaps the highest compliment I can pay is that, without hesitation, I’d encourage them to be accountants.  I trust I have greater success with my grandchildren than I did with my three daughters. Whilst they all have significant careers they are far removed from accounting.

As I prepare to handover this role to Olivia and as we talk about any legacy I may leave to my grandchildren, I encourage all of you to think about the legacy we’ll leave to the next generation of accountants.

They must inherit an active and vocal profession; one that is a credible contributor to global and national policy debates. We must leave to them a profession that contributes to organizational sustainability and economic growth. And this legacy is endowed by a profession that others look to as a model of inclusion, diversity, and integrity.

Thank you for listening. And thank you AICPA for your outstanding contribution to the global profession.

International Public Sector Accounting Standards Board (IPSASB) Chair Andrea Bergmann, Deputy Chair Ron Salole, IPSASB Member Guohua Huang, and IFAC Board Member Ahmadi Hadibroto were featured speakers at an Asian Development Bank Regional Workshop on Public Sector Accounting held September 29-30, 2014, in Jakarta, Indonesia.  

Christopher Arnold, IFAC Technical Manager, SME & SMP Affairs, discusses global and regional trends impacting small- and medium-sized practices (SMPs), including the results of the 2013 IFAC SMP Quick Poll and other research, at the 2014 IFAC-SAFA Regional SMP Forum. 

SMP Committee Chair Giancarlo Attolini discusses practice management, including the influence of technology and new service offerings, at the 2014 IFAC-SAFA Regional SMP Forum.