INTERNATIONAL CONVERGENCE OF ACCOUNTING

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INTERNATIONAL CONVERGENCE OF ACCOUNTING
AUDITING STANDARDS REGULATION
WORLD BANK ADVANCED PROGRAM in ACCOUNTING and
AUDITING REGULATION MODULE 10 17 October 2005

• Paul Boyle
• Chief Executive

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Agenda

• Forces affecting corporate behaviour
• The corporate reporting process
• Corporate reporting governance a joined-up
  approach
• International standards implementation
• International audit regulation
• Completing the international architecture

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Forces affecting corporate behaviour
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The corporate reporting process
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Corporate reporting governance a joined-up
approach

• Links between issues
• Accounting
• Auditing
• Professionalism of accountants
• Corporate governance
• The ability to cover all of these issues
  increases effectiveness

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The FRCs aim

• is to promote confidence in corporate reporting
  and governance

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Our objectives

• To promote
• high quality corporate reporting
• high quality auditing
• high standards of corporate governance
• the integrity, competence and transparency of the
  accountancy profession
• the FRCs effectiveness as an independent
  regulator

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Our regulatory philosophy

• A well-informed market is the best regulator
• Targeted use of powers (proactive, risk-based)
• Principles and clarity in standards and codes
• Consultative, practitioner decision-making but
  independent
• Promote appropriate international approaches
• Transparency, accountability and awareness

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International standards implementation

• Keep in mind all stages of the process
• The process as a whole needs to add value
• Small medium-sized companies have special
  considerations
• Independence accountability of regulators are
  both important

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International audit regulation

• 100 self-regulation is no longer politically
  acceptable
• Independent audit regulators emerging in various
  countries
• Benefits of convergence of auditing standards
• ISA-plus model
• Independent monitoring and enforcement

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Completing the international architecture

• International capital markets, international
  audit firms an international regulatory
  response is required
• Globally/regionally
• Pressure on firms to improve international
  quality delivery
• International regulatory convergence is a
  reasonable request
• Global regulation is not feasible but
  agreement on common principles and co-operation
  is more realistic

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Completing the international architecture
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Completing the international architecture
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Completing the international architecture
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• Promoting confidence in corporate reporting and
  governance