AUDITING presentation

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I A

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IFACStrengthening
Organization
Advancing
Economics
IFAC refers to the International
Federation of Accountants.
It 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.

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History of IFAC
Formation 07 October 1977 in Munich, Germany, at
the 11th World Congress of Accountants
Type :INGO
Legal status :Association established under Swiss
Civil Code
Purpose :Strengthening the worldwide accountancy
profession
Headquarters :New York City, United States

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History of IFAC
Location Geneva, Switzerland
Region served Beginning 51 but now 130 countries and
jurisdictions worldwide
Members Beginning 63 but now 175
Official language English
CEO Fayezul Choudhury (From 2013 to present)
Main organ Council

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President of IFAC
IFAC is led by its President, who is nominated by a member body and appointed by the
IFAC Council. From its foundation it has been presided by 17 presidents.
The First president was Reinhard Goerdeler, Germany (1977–1980)
The present president is Olivia Kirtley.
(2014 to present)

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Mission of IFAC
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 these standards.
Building the capacity of professional accountancy organizations.
Speaking out on public interest issues.

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Vision of IFAC
The global accountancy profession be recognized as essential to strong
and sustainable organizations, financial markets, and economies.

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IFAC StrategicPlan for 2016-2018
Charting the Future of the Global Profession
This strategic plan for 2016-2018 aims to prepare the global accountancy profession for the
inevitable turbulence and corresponding opportunities, while highlighting the unique position
and economic benefits of IFAC’s activities.
Building on the 2015 strategic plan, which explains how IFAC plans to maximize opportunities
and minimize risk, Charting the Future of the Global Profession responds to macro trends with
significant implications for the profession and outlines IFAC’s planned activities in response

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The promulgation of International Standards.
Features independent boards for education & public sector
accounting.
Serves as an international model.
IFAC includes the organizing of the World Congress of Accountants.
Functions of IFAC

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Roles of professional Accountants on Business
Governing the organization (such as, approving annual budgets
and accounting to the stakeholders for the company’s
performance)
 Appointing the chief executive; and determining
management’s compensation
 Oversight over all matters relating to the company’s financial
health

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Roles of professional Accountants on Business(cont.)
Protectors of public interests.
Provide independent assurance to management.
 Competing Demands .
Evolving role in evolving an environment

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Recent Developments
 to revise terminology in addition to improving clarity.
 to make some significant alterations to the Auditor Independence Process.
The codes of the International Federation of Accountants have
been revised recently. The new changes in IFAC are:

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Reports
 Call for Nominations for the IFAC Board and Committees in 2018
Published: Nov 22, 2016
Related: IFAC Guidance & Support Tools
 The Accountancy Profession: Fighting Fraud and Corruption Open Letter to His Holiness Pope
Francis.
Published: Nov 17, 2016
Related: Build Trust
 IFAC Response to the PIOB Consultation
Published: Nov 09, 2016

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Reports (cont.)
 The 2030 Agenda for Sustainable Development .A Snapshot of the Accountancy Profession's
Contribution
Published: Nov 09, 2016
 IFAC Professional Accountants in Business Committee. Response to COSO's
Enterprise Risk Management Exposure Draft
Published: Oct 10, 2016
Related: risk management & internal control

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Reports (cont.)
 PAIB Committee Response to the IESBA Proposed Changes to the Code of Ethics for Professional
Accountants Addressing Conflicts of Interest
Published: Mar 30, 2012
Related: business ethics, PAIB
 Evaluating and Improving Internal Control in Organizations. International Good Practice Guidance
Published: Jun 28, 2012
Related: risk management & internal control, PAIB, International Good Practice Guidance
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Standard Setting Boards of IFAC
International Auditing and Assurance Standards Board or IAASB.
International Ethics Standards Board for Accountants or IESB.
International Public Sector Accounting Standards Board or
IPSASB.
International Accounting Education Standards Board or IAESB.

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International Auditing and Assurance Standards Board
The International Auditing and Assurance Standards Board or IAASB is an independent standard-setting
board that develops the international of auditing. IAASB issues International Standards on Audit covering
various services offered by professional accountants worldwide like auditing, review, other assurance, quality
control and related services.
The IAASB's current strategic themes include:
1. Supporting global financial stability Enhancing the role,
2. relevancy and quality of assurance in an evolving world
3. Facilitating adoption and implementation of the standards it sets
The Public Interest Oversight Board (PIOB) oversees the work of the IAASB and its CAG( Consultative
Advisory Group) to ensure that the activities of the IAASB follow due process and are responsive to the public
interest.

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Consultative Advisory Group (CAG)
The IAASB Consultative Advisory Group (CAG) is an integral and important part of
the IAASB's formal process of consultation. Representatives of CAG member
organizations provide advice on numerous areas, including:
 The IAASB's agenda and project timetable (work program), including project
priorities;
 Technical projects; and
 Other matters of relevance to the activities of the IAASB.
The CAG's objective and scope of activities, membership and composition, and
operating procedures are set out in its Terms of Reference. The Public Interest
Oversight Board (PIOB) oversees the work of the CAG

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Public Interest Oversight Board
Creation of the PIOB in 2005 was triggered by a series of corporate scandals including the collapse
of Enron and WorldCom in the United States and of Parmalat in Europe. These undermined public confidence in the
conduct and competence of audit practitioners, leading to demand for an overhaul of the IFAC including an
independent oversight body to ensure that all standards are in the public interest.
The PIOB oversees the public interest activities of three independent standard-setting boards supported by IFAC: the
International Auditing and Assurance Standards Board (IAASB), the International Accounting Education Standards
Board (IAESB) and the International Ethics Standards Board for Accountants(IESBA). The PIOB also oversees the
IFAC's Compliance Advisory Panel.

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International Ethics Standards Board for Accountants
The International Ethics Standards Board for Accountants develops a Code of Ethics for Professional
Accountants to be followed by professional accountants throughout the world. The IESBA periodically
issues revised standards. In 2016 the IESBA issued a revised Code of Ethics for Professional Accountants
to be effective from July 15, 2017.
The board also provides adoption and implementation support, promotes good ethical practices
globally, and fosters international debate on ethical issues faced by accountants

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International Ethics Standards Board for Accountants
The Strategy and Work Plan lays out four inter-connected strategic themes that articulate the board’s vision
over the medium to longer term:
 maintaining a high quality Code of Ethics for Professional Accountants (the Code) for application by
professional accountants globally;
 promoting and facilitating the adoption and effective implementation of the Code;
 evolving the Code for continued relevance in a changing global environment; and
 increasing engagement and cooperation with key stakeholders.

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International Public Sector Accounting Standards Board
The International Public Sector Accounting Standards Board or IPSASB develops the International
Public Sector Accounting Standards (IPSAS). IPSAS’s are a set of accounting standards for use by
public sector entities around the world in the preparation of financial statements.
IPSAS aims to improve the quality of general purpose financial reporting by public sector entities, leading
to better informed assessments of the resource allocation
These standards are based on International Financial Reporting Standards (IFRS) issued by the
International Accounting Standards Board (IASB).

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International Public Sector Accounting Standards Board
The IPSASB’s forward strategy from 2015 has a single strategic objective:
Strengthening public financial management and knowledge globally through increasing adoption of accrual-
based International Public Sector Accounting Standard
Developing high-quality public sector financial reporting standards
Developing other publications for the public sector; and
Raising awareness of the IPSASs and the benefits of their adoption.

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Features of International Public Sector Accounting Standards
Board
There are 38 standards on the accrual basis of accounting and one standard on the cash basis of accounting
(source: IPSAS Handbook published March 2011).
When the accrual basis of accounting underlies the preparation of the financial statements the financial
statements will include:
the statement of financial position
the statement of financial performance
the cash flow statement
the statement of changes in net assets/equity
the notes to the financial statements , or annex.

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IPSAS Adoption by Bangladesh
The government of Bangladesh has expressed both commitment and willingness to adopt the cash basis
IPSAS. Bangladesh has also taken an initiative to prepare the financial statements in accordance with the
cash basis IPSAS. The first set of IPSAS based statements for the core ministries (excluding specialized
organizations) and the specialized organizations are planned to be produced by the fiscal year 2007-2008
and 2009-2010 respectively.
The government considers the adoption of the cash basis IPSAS a point of departure towards
implementing the accrual basis of accounting in the long run.

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International Accounting Education Standards Board
The International Accounting Education Standards Board (IAESB) is an
independent organization within the fold of the International Federation of
Accountants (IFAC). The board develops guidance to improve standards of
education in accountancy.
The main areas of focus are the key elements of accreditation and the
requirements of accountants for continuing professional education. The board
also sponsors studies or papers about accounting education that promote
discussion and debate on accounting education and development issues.

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International Accounting Education Standards Board
The IAESB’s objective is to serve the public interest by:
 Establishing a series of high-quality standards and other publications reflecting good practice in the education,
development, and assessment of professional accountants;
 Promoting the adoption and implementation of the International Education Standards;
 Developing education benchmarks for measuring the implementation of the International Education Standards;
and
 Advancing international debate on emerging issues relating to the education, development, and assessment of
professional accountants.

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Other Bodies
In addition to the standards boards, IFAC also features the following bodies:
 The Compliance Advisory Panel the Developing Nations Committee.
 The Nominating Committee.
 The professional Accountants in Business Committee.
 The Small and Medium Practices Committee.
 The Trans-national Auditors Committee.

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Criteria for Becoming a Member
The IFAC Board has the authority and responsibility for determining the criteria and
procedures by which organizations are admitted as Members of IFAC.
Admission Process:
IFAC staff guide candidate PAOs in the admission process with the advice and oversight
of the IFAC Compliance Advisory Panel (CAP) . The admission process includes:
1. An initial expression of interest by the PAO (professional accountancy organization
)and the establishment of an ongoing dialogue with IFAC
2. Developing an understanding of the IFAC admission criteria and the IFAC Statements
of Membership Obligations (SMOs);

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Criteria for Becoming a Member(cont.)
3. Completing an initial SMO Action Plan, with guidance from IFAC;
4. Seeking sponsorship from an existing IFAC Member;
5. Submitting application package materials, sponsor’s report, and an application fee;
6. IFAC’s assessment of the PAO and application materials; and
7. Consideration of the application by the Compliance Advisory Panel and IFAC Board
followed by vote by the IFAC Council.

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Some selected Members of IFAC
Bangladesh
Institute of Chartered Accountants of Bangladesh(ICAB)
Institute of Cost and Management Accountants of Bangladesh(ICMAB)
India
Institute of Chartered Accountants of India(ICAI)
Institute of Cost Accountants of India(ICAI)

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Some selected Members of IFAC
Pakistan
Institute of Chartered Accountants of Pakistan(ICAP)
Institute of Cost and Management Accountants of Pakistan(ICMAP)
Sri Lanka
Institute of Chartered Accountants of Sri Lanka(ICASL)
Nepal
Institute of Chartered Accountants of Nepal(ICAN)

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China
Chinese Institute of Certified Public Accountants(CICPA)
Canada
Canadian Institute of Chartered Accountants (CICA)
Certified General Accountants Association of Canada(CGA-Canada)
Australia
Chartered Accountants Australia and New Zealand(CAANZ)
Some selected Members of IFAC

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United Kingdom
Association of Accounting Technicians(AAT)
Association of Chartered Certified Accountants(ACCA)
Chartered Institute of Management Accountants(CIMA)
United States
American Institute of Certified Public Accountants(AICPA)
Institute of Management Accountants(IMA)
Some selected Members of IFAC

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Value of Membership
IFAC is comprised of over 175 Members and Associates in over
130 countries and jurisdictions*, representing almost 3 million
accountants in public practice, education, government service,
industry, and commerce. IFAC Members and Associates are
professional accountancy organizations (PAOs) recognized by law
or general consensus within their countries as substantial
national organizations.

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 Become part of the global voice of the profession;
 Obtain access to information, resources, and support to help strengthen the profession locally,
regionally, and nationally; and
 Provide input on critical global issues and contribute to the global agenda.
In addition to the above, IFAC Members influence the operations, strategy, leadership, and
membership of IFAC by voting on many different matters during all IFAC Council meetings.
IFAC Member and Associate status brings with it a great deal of value. Members
and Associates:

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Recent Activities of IFAC
 Enhanced Reporting Policy Position Paper Updated; Focuses on Importance of Integrated
Reporting.
Jan 10, 2017
 IPSASB Staff Issue Emissions Trading Schemes Background Paper.
Jan 09, 2017
 Speeches & Presentations by Sanjay Rughani, CEO, Standard Chartered Bank Tanzania, and
Deputy Chair, IFAC Professional Accountants in Business Committee.
Dec 02,2017

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Recent Activities of IFAC (cont.)
 IFAC Announces Rachel Grimes of Australia as IFAC President.
Nov 22, 2016
 Accountancy Profession Leaders Sought for Volunteer
Positions on IFAC Board and Committees.
Nov 22, 2016
 IFAC President Responds to Pope Francis' Call to Action.
Nov 17, 2016

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Overview of IFAC
IFAC Provides structures and processes that supports the development of high quality international
standards .
In the area of Auditing, Assurance& quality control.
Public Sector Accounting
Accounting education.
Ethics.
IFAC Supports

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 IFAC develops and provides Internationally recognized standards, that is helpful for both
private & public sector.
 IFAC also provides some tools and guidance. Such as ISA Modules, Practice management,
Sustainability framework etc.
 IFAC also provides regulation & public policy.
 IFAC supports four standards setting boards. They are IAASB, IAESB, IPSASB & IESBA.
Overview of IFAC (cont.)

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