Together with ICAEW, The International Federation of Accountants (IFAC) today released the third installment in its Anti-Money Laundering: The Basics educational series: Installment 3: Company Formation.  

The publication is part of a 6-month short series helping accountants enhance their understanding of how money laundering works, the risks they face, and what they can do to mitigate these risks and make a positive contribution to the public interest. Installment three examines company formation, one of the services performed by professional accountants that is most susceptible to money laundering risk.

Anti-Money Laundering: The Basics is featured on both the IFAC and ICAEW websites and available for download for free. With installment three, IFAC is featuring the series on a new landing page alongside other relevant information on anti-money laundering (AML).

To be globally relevant, the Anti-Money Laundering: The Basics  series uses the risk-based approach of the Financial Action Task Force (FATF) – the global money laundering and terrorist financing watchdog -- as a starting point. 

For more information about IFAC, visit www.ifac.org.

For more information about ICAEW, visit https://www.icaew.com/.

The IFAC Nominating Committee is seeking to fill six vacancies on the International Public Sector Accounting Standards Board (IPSASB). New Board Members will serve an initial term of up to 3 years, commencing January 1, 2022.

Candidates will ideally have a public sector background and/or experience in standard setting to be able to contribute value to the work of the Board. English proficiency (both written and oral) is essential, as this is the language in which the IPSASB operates.

The IPSASB is an independent standard-setting body that serves the public interest by setting high-quality accounting standards for use by public sector entities around the world in the preparation of general purpose financial reports. Nominations from a wide range of relevant backgrounds are sought, including, but not limited to, candidates from:

• Users of general purpose financial reports, such as parliamentarians, budget offices, and credit-rating agencies.
• Preparers of accrual-based financial statements, such those reporting directly or indirectly in accordance with IPSAS or being in the process of transitioning to IPSAS or another accrual-based accounting framework.
• Ministries of Finance and Treasury departments.
• International and regional development organizations.
• Public sector external auditors.

The Nominating Committee aims to maintain diversity on the IPSASB in terms of gender, regional, and professional background. For these reasons, nominations of qualified female candidates, and qualified candidates from the Africa–Middle East and Asia regions, as well as from jurisdictions where English is not the native language, are particularly encouraged.

All stakeholders, including the general public, governments, IFAC member organizations, and public sector auditors are invited to nominate candidates.

Deadline for submitting applications is January 31, 2021. Please see the Call for Nominations for more details and information on how to submit an application.

The IAASB has published video introductions to the new and revised quality management standards in English, French and Spanish. The videos explain the key aspects of the three standards to help stakeholders begin their implementation efforts.

The IAASB recently approved the suite of new and revised quality management standards, which will be released following approval from the Public Interest Oversight Board of the due process later this year. The new and revised quality management standards will become effective on December 15, 2022.

The International Auditing and Assurance Standards Board (IAASB) Technology Working Group today released a new non-authoritative frequently asked questions publication on using automated tools and techniques in identifying and assessing risks of material misstatements in accordance with International Standard on Auditing 315 (Revised 2019), Identifying and Assessing Risks of Material Misstatement. 

The publication assists auditors to understand the types of automated tools and techniques that can be used, and how they can be used, in performing risk assessment procedures. It also addresses considerations regarding the entity’s use of machine learning or artificial intelligence when performing risk assessment procedures.

This publication does not amend or override the International Standards on Auditing (ISAs), the texts of which alone are authoritative. Reading the publication is not a substitute for reading the ISAs.

Today the IAASB released a key takeaways publication following three recent virtual roundtables with experts and leaders exploring issues and challenges related to fraud and going concern. These roundtables focused on:

1. The impact of technology advancements on fraud perpetration and detection;
2. The “expectation gap”, or differences between public perceptions and the auditor’s responsibilities for fraud and going concern; and
3. Fraud and going concern in audits of less complex entities.

Today’s publication details the roundtables and what we heard. The input from these roundtables comprise one aspect of the IAASB’s broader information-gathering activities related to fraud and going concern that will be considered in determining possible future actions.

The full roundtable recordings, including individual breakout sessions, are available on the IAASB’s YouTube channel:

• Fraud Technology Roundtable
• Expectation Gap Roundtable
• Fraud and Going Concern Procedures in Less Complex Entities Roundtable

If you would like to know more about the IAASB’s work on fraud and going concern, please visit the project pages on fraud and going concern for further information. The IAASB also encourages all interested stakeholders to respond to the IAASB’s related Discussion Paper, Fraud and Going Concern in an Audit of Financial Statements: Exploring the Differences Between Public Perceptions About the Role of the Auditor and the Auditor’s Responsibilities in a Financial Statement Audit, which is currently open for consultation until February 1, 2021.

Fraud and going concern are important public interest issues for the IAASB. To allow adequate time for all of our stakeholders to respond to the IAASB’s Discussion Paper, Fraud and Going Concern in an Audit of Financial Statements: Exploring the Differences Between Public Perceptions About the Role of the Auditor and the Auditor’s Responsibilities in a Financial Statement Audit, the closing date of this consultation has been extended to February 1, 2021. This extension takes into account the upcoming holidays and our stakeholder’s capacity this year and is in response to stakeholder requests.

The Discussion Paper aims to gather perspectives from all our stakeholders across the financial reporting ecosystem about the role of the auditor in relation to fraud and going concern in an audit of financial statements, and to obtain input on matters about whether our standards related to fraud and going concern remain fit-for-purpose in the current environment. The input from this consultation, together with other information gathering and outreach activities, will inform IAASB decisions about possible further actions on these topics.

If you would like to know more about the IAASB’s work on fraud and going concern, including the recent roundtables on these topics, please visit the project pages on fraud and going concern. The IAASB also encourages all interested stakeholders to respond to this Discussion Paper, including investors and other users of financial statements, those charged with governance of entities, preparers of financial statements, national standard setters, professional accountancy organizations, academics, regulators and audit oversight bodies, auditors and audit firms, and others where interested.

Focusing on the effective and consistent application of our standards, the IAASB has published a new communique detailing its next steps to address complexity, understandability, scalability, and proportionality, including in the audits of financial statements of less complex entities.

The communique details the IAASB’s efforts to balance the needs of all its stakeholders by developing a separate standard focused on less complex entities while simultaneously addressing complexity, understandability, scalability and proportionality in the International Standards on Auditing more broadly.

Professional accountants make a significant contribution to the economy at the local, national and global levels. IFAC partnered with the Centre for Economics and Business Research (Cebr), one of the world’s leading economics consultancies, to get a clearer understanding of these contributions.

The results are striking.

In each measure reviewed, a greater number of accountants correlates to better economic performance. Moreover, professional accountants who are members of IFAC member professional accountancy organizations (PAOs) correlate to even stronger performance on economic indicators.

“At IFAC, we have always understood the strong connection between a well-developed accountancy profession and economic development,” said Kevin Dancey, IFAC CEO. “This research will help policymakers around the world have better informed conversations with professional accountants and PAOs about their contributions to society and potential partnerships for development and growth.”

Cebr’s analysis reviewed the accountancy profession in the G20 countries, including each individual country of the European Union. Data was assembled from a range of sources, including the World Bank, World Economic Forum, and Organisation for Economic Cooperation and Development, to establish relationships between economic variables and numbers of accountants and PAO members.

This research follows earlier projects on the positive contributions of the accountancy profession:

• Nexus 1: The Accountancy Profession, Behind the Numbers
• Nexus 2: The Accountancy Profession—A Global Value Add
• The Accountancy Profession—Playing a Positive Role in Tackling Corruption

About IFAC
IFAC is the global organization for the accountancy profession dedicated to serving the public interest by strengthening the profession and contributing to the development of strong international economies. IFAC is comprised of more than 175 members and associates in more than 130 countries and jurisdictions, representing more than 3 million accountants in public practice, education, government service, industry, and commerce.

Ahead of the anticipated release of the International Auditing and Assurance Standards Board’s suite of new quality management standards following Public Interest Oversight Board approval later this year, the IAASB has developed implementation plans for each of the three standards. The plans explain what implementation materials stakeholders can anticipate, topics covered, and expected timing.

The International Auditing and Assurance Standards Board (IAASB) announces the following new appointments and re-appointments to take effect on January 1, 2021:

New Board Members

• Mr. Edo Kienhuis (Partner, PwC, the Netherlands, nominated by Forum of Firms)
• Ms. Diane Larsen (Deputy to the Global Quality Enablement Leader, EY, USA, nominated by Forum of Firms)
• Ms. Wendy Stevens (Partner, National Practice Leader, Quality & Risk Management, Mazars, USA, nominated by the Association of International Certified Professional Accountants)

Reappointed Board Members

• Mr. Chun Wee Chiew (Regional Head of Policy ASEAN ANZ for the Association of Chartered Certified Accountants, Singapore, nominated by ACCA)
• Prof. Kai-Uwe Marten (Director of the Institute of Accounting and Auditing at the University of Ulm, Germany, nominated by Institut der Wirtschaftsprüfer and Wirtschaftsprüferkammer in Germany)
• Mr. Fernando Ruiz Monroy (Regional Assurance Risk Management Partner, EY, Mexico, nominated by Instituto Mexicano de Contadores Públicos, A.C., in Mexico)
• Mrs. Isabelle Tracq-Sengeissen (Audit Partner, EY, France, nominated by Compagnie Nationale des Commissaires aux Comptes and Conseil Supérieur de l'Ordre des Experts-Comptables in France)

“It is a pleasure to welcome all the new members to the IAASB and congratulate re-appointed members,” said Tom Seidenstein, IAASB Chair. “The work of our volunteers is crucial to the global financial architecture, especially during these challenging times. I am eager to bring these talented professionals and their fresh perspectives into our work, and I look forward to what we will collectively accomplish.”

The IAASB also announces the appointment of Mr. Len Jui as its deputy chair for 2021. Mr. Jui, who has served as an IAASB member since 2017, is a partner at KPMG China and serves as the head of Public Policy and Regulatory Affairs.

“I am also extremely pleased that Len Jui will begin serving as deputy chair of the Board," said Seidenstein. “Len has a long history of working and volunteering for the public good, having previously served as associate chief accountant at the US Securities and Exchange Commission, a Technical Advisor on the IAASB and as an International Organization of Securities Commissions (IOSCO) representative member on the IAASB’s and International Ethics Standards Board for Accountants’ Consultative Advisory Groups. I want to also thank Robert Dohrer, Rich Sharko and in particular, Fiona Campbell, our current deputy chair, as they depart from our Board. Their insight, their talent, and their tireless dedication to the public good has left a lasting legacy.”

About the Nominating Committee
The Nominating Committee makes recommendations to the International Federation of Accountants (IFAC) Board and Public Interest Oversight Board (PIOB) on the composition of the IAASB and IESBA.

The Nominating Committee is guided in its work by the principle of selecting the most suitable person for the position. In doing so, it endeavors to balance the nominee’s abilities and professional qualifications with the representational needs of the board, such as broad regional and professional representation and gender balance. The PIOB representative observes the selection process for IAASB and IESBA memberships with regular updates to the PIOB. To learn more about the Nominating Committee, visit its web page.

About the IAASB
The IAASB develops auditing and assurance standards and guidance for use by all professional accountants under a shared standard-setting process involving the Public Interest Oversight Board, which oversees the activities of the IAASB, and the IAASB Consultative Advisory Group, which provides public interest input into the development of the standards and guidance. The structures and processes that support the operations of the IAASB are facilitated by the International Federation of Accountants (IFAC). For copyright, trademark, and permissions information, please go to permissions or contact permissions@ifac.org.