Realizing the Power of Professional Accountants Fayezul Choudhury, Chief Executive Officer INTOSAI Capacity Building Committee Annual Meeting September 19, 2017

International Federation of Accountants A Global Profession Established 1977 175+ members organizations 130+ countries & jurisdictions 3 million professional accountants in public and private sectors Slides 2-4 provide a brief introduction to IFAC IFAC in numbers

International Federation of Accountants A Global Mission IFAC serves the public interest and strengthens the accountancy profession by … Supporting the development of high-quality international standards Promoting the adoption and implementation of those standards Building the capacity of professional accountancy organizations Speaking out on public interest issues Brief overview of IFAC’s public interest mission Focus on the development, adoption, and implementation of standards, which is particularly relevant to this presentation

International Federation of Accountants A Wide Remit Private Sector Civil Society Public Sector Clarify that IFAC has a wide remit spanning both the private and public sectors Working together to protect the public interest and – so doing – civil society

Building Trust. Inspiring Confidence. International Federation of Accountants Building Trust. Inspiring Confidence. Quality corporate financial reporting International Financial Reporting Standards (IFRS) Quality public financial reporting International Public Sector Accounting Standards (IPSAS) Effective assurance community International Standards on Auditing (ISA) Competent professional accountants International Education Standards (IES) Code of Ethics for Professional Accountants Effective professional accountancy organization (PAO) Statements of Membership Obligations (SMOs) Effective regulation Slides 5-7 moves into IFAC building trust and inspiring confidence through sound global, regional, and national financial systems underpinned by international standards Starting with the key attributes of a sound financial system and how each attribute is supported by international standards Recognizing that all the attributes are under the umbrella of effective governance

IFAC’s Role in International Standard Setting Building Trust. Inspiring Confidence. IFAC’s Role in International Standard Setting Facilitating the processes of the independent international standard-setting boards Promoting adoption of the international standards Supporting implementation of the international standards Briefly explain IFAC’s role in international standard setting in the public interest In addition to facilitating international standard setting in the public interest, IFAC promotes the adoption and supports the implementation of those standards through various activities, including: IFAC Member Compliance Program IFAC PAO Capacity Building Program Facilitation of translations Accountability. Now. initiative Calls on the G-20 Guidance and tools developed by the SMPC, PAIBC, and PAODC Speaking out activities

High-Quality International Standards Building Trust. Inspiring Confidence. High-Quality International Standards Rigorous due process under public interest oversight—quality, credible, globally accepted standards Foster high-quality financial information Promote trust in governments Promote confidence in financial markets Facilitate regional and international economic integration Provide an overview of the independent international standard-setting boards supported by IFAC, as well as the standards they develop Explain how a rigorous due process under public interest oversight contributes to the quality, credibility, and global acceptance of the standards Explain how – in turn – this contributes to better reporting, trust, confidence, and integration

Accountancy Education the Foundation Building Trust. Inspiring Confidence. Accountancy Education the Foundation Accountancy education Competence and expertise Trust, ethics, credibility A strong profession Economic growth and stability Slides 8-10 focus on accountancy education Illustrate how accountancy education and practical training is the foundation of a strong profession contributing to economic growth and stability

International Education Standards IES 1, Entry Requirements to Professional Accounting Education Programs IES 2, Technical Competence IES 3, Professional Skills IES 4, Professional Values, Ethics, and Attitudes IES 5, Practical Experience IES 6, Assessment of Professional Competence IES 7, Continuing Professional Development IES 8, Competence Requirements for Audit Professionals Provide an overview of the International Education Standards (IES) developed by the International Accounting Education Standards Board (IES) – i.e., reference the titles of IES 1 – 8 so as to provide a high-level understanding of the content An IAESB project on the development/modification of learning outcomes in the area of public sector accounting, reporting, and assurance commenced in July 2017. At the moment, the responsible IAESB task force is reaching out to stakeholders, including INTOSAI, to obtain an understanding of the potential gaps in the area of competence development in the public sector

Professional Accountancy Qualification Journey Education (Initial including technical and ethics) Practical Experience (Work experience and training) Assessment (Examination) Certification received ** Licensing (Certified public accountants / auditors) Continuous Professional Development (Lifelong learning) Provide an overview of the professional accountancy qualification journey under IES

Regional Distribution of Data Draft report covers 104 PAOs in 80 jurisdictions Good regional distribution Data collected through IFAC Member Compliance Program Report updated annually Slides 11-15 discuss the status of adopting of the International Education Standards, drawing on the draft Status of Adoption and SMO Fulfillment Report, which – this year – covers 104 IFAC Member Organizations in 80 jurisdictions Explain that all IFAC Member Organizations are subject to membership obligations, which are encapsulated in the membership admission criteria and seven Statements of Membership Obligations (SMOs) The SMOs require IFAC Member Organizations to use their best endeavors to promote the adoption and support the implementation of the international standards in their jurisdiction Their compliance with the SMOs is monitored under the IFAC Member Compliance Program This slides shows the regional distribution of the PAOs covered in the draft report

Referring to the slide, IES is low on the list of a The next slide shows that the adoption of IES is likely affected by the PAOs’ lack of responsibility for adoption of IES

This slide shows the PAOs responsibility for adoption of the various international standards; PAOs have low direct responsibility for the adoption of IES, affecting their adoption and implementation globally

Out of the 104 jurisdictions, 20% have fully adopted and 80% have partially adopted IES IES have been adopted to some extent in all 104 jurisdictions

In the majority of jurisdictions covered in the draft report – i. e In the majority of jurisdictions covered in the draft report – i.e., 84% - have not direct responsibility for the adoption of IES

Build Trust. Inspire Confidence. Coordinate. Collaborate. Partner Build Trust. Inspire Confidence. Coordinate. Collaborate. Partner. For greater impact. Emphasize the importance of quality accountancy education and training in both the private and public sector as the foundation for building trust in governments and inspiring confidence in financial markets Acknowledge that the task is large and that all stakeholders, including IFAC and INTOSAI, should strive to coordinate, collaborate, and partner for greater impact