The paper, titled Doing business in a carbon-constrained economy, was produced in response to the Australian government’s green paper on the Carbon Pollution Reduction Scheme.
“The Carbon Pollution Reduction Scheme will fundamentally change the economic environment,” Deloitte Australia chairman Wayne Goss said. “However, many Australian businesses are still at the early stages of understanding exactly how these changes will affect them. Climate change is no longer just an issue for the environmental or sustainability team – it applies to every level of management whether it is tax, supply chain, corporate governance or reporting.”
• Global tax adviser network TAXAND has admitted two new members. Greenwoods and Freehills becomes TAXAND’s Australian member while William Fry adds expertise in Ireland. The Australian accountancy and law firm has 60 professionals, including 26 directors. William Fry has more than 20 full-time tax professionals, including six partners.
TAXAND has more than 300 tax partners and 2,000 tax advisors operating in more than 40 countries worldwide. It is affiliated with global professional services firm Alvarez & Marsal.
• The Japanese Institute of Certified Public Accountants (JICPA) has published the seventh edition of The CPA Profession in Japan. The publication covers a wide range of topics from JICPA initiatives to regulatory framework, including the recent amendments of the CPA Act. The publication is in English and is available to download from the JICPA website.
• Twenty-three percent of Singaporean companies experienced at least one incident of fraud over the past year, according to new research from KPMG Singapore.
The Singapore Fraud Survey Report 2008 made four key findings. Certain fraud risks were increasing, companies suffering from fraud were three times more likely to have suffered technology or computer-related fraud. Greed was the strongest motivator according to 70 percent of survey respondents. Employees were the first line of defence, 88 percent of fraudulent activities identified in organisations were discovered by employees. Ninty-one percent of survey respondents also found that fraud risk management was essential for good business practice.
The sample covered directors and senior executives among the top 1,000 companies listed on the Singapore Exchange.
• Australia is to enforce a revised set of auditing standards in clarity format from 1 January 2010.
The Auditing and Assurance Standards Board (AUASB) will redraft and issue its Australian Auditing Standards (ASAs), which conform to ISAs in clarity format. The ASAs will be redrafted progressively in groups and released for exposure. The final ASAs will not be issued until all the redrafted standards have been approved, which is expected to occur in October 2009.
AUASB chairman Merran Kelsall said feedback from constituents on the proposed standards will be vital to the process. Meanwhile, the standard setter released four redrafted ASAs in line with the clarity project for comment.
• The Japanese Institute of Certified Public Accountants has issued two separate reports, one on eXtensible Business Reporting Language (XBRL) and another on ethics. The XBRL report sets out recommendations on changes in the process to prepare financial statements arising from the introduction of XBRL to the Electronic Disclosure for Investors Network (EDINET).
It also highlights matters to be considered by auditors in light of these changes. Japanese companies are required to submit financial statements in XBRL to the EDINET for financial years beginning on 1 April 2008 onwards.
The other report, Independence Required for the Audit of Audit Corporations, is aimed at helping improve the practical judgement of auditor independence. It provides the fundamental concept under the Code of Ethics and explains how to apply this concept to specific circumstances. In Japan, the financial statements of limited liability audit corporations are required to be audited by an independent auditor with no specific interest in the audit corporation. Both documents are available in Japanese only.
• Australia is likely to witness a raft of goodwill impairment announcements in the upcoming financial reporting period as the impact of the decline in global financial markets is reflected in financial statements, according to a KPMG Australia national audit partner.
Kris Peach said a number of entities are now likely to admit that their company either overpaid for an acquisition during the strong market performance of recent years, or that their newly merged business had not performed as expected. Peach said a large number of balance sheet write-downs, or goodwill impairments, could be inevitable.
“The current sense I have of the market tells me that plenty of goodwill impairment announcements are just around the corner. It is going to be a decidedly uncomfortable experience for companies that have had a healthy stock market for the past five years,” she added.
Australian Accounting Standards require goodwill to be assessed for impairment at each reporting date.
• The Japanese Institute of Certified Public Accountants has completed an English translation of Auditing and Assurance Committee Statement No 82 Practical Guidance for Audits of Internal Control over Financial Reporting, which was issued in October last year.
The translation, which is available on the institute’s website, is to be used solely as reference material to aid in the understanding of the original statement. For all purposes, including practical application of the statement, users are instructed to consult the original Japanese texts.
• The National Institute of Accountants (NIA) in Australia has helped launch a textbook comparing IFRS with Chinese Accounting Standards (CAS). The publication, Brief on the IFRS and Comparison with the CAS, will be used as the core training material for the joint accountancy education programmes between the NIA and the China Enterprise Confederation/China Enterprise Directors Association.
Jianxin Wang, an accounting expert at the Institute of Finance in China, wrote the book, which details the range of differences between the two sets of accounting pronouncements.
• UK professional services firm Tenon has signed an agreement with software supplier Microsoft to offer businesses a combination of Microsoft Dynamics GP software and outsourced financial services support. Tenon is offering services, including financial processes, such as payroll and payables, as well as advice on issues such as VAT and employer tax.
Tenon national head of outsourcing Richard Fifield said: “Tenon is the only business adviser in the UK to offer this service, which is a hugely exciting opportunity for businesses with more sophisticated finance needs, enabling them to better manage risk, speed market entry and reduce costs. We expect keen interest in this unique solution as more and more entrepreneurs are looking to outsource and focus on their core business.”
• The European Financial Reporting Advisory Group has expressed a number of concerns about the International Accounting Standards Board and US Financial Accounting Standards Board’s joint exposure draft covering chapters one and two of the boards’ proposed conceptual framework. In a draft comment letter to the standard setters, the group said that no part of the framework should be finalised until the whole framework was ready. EFRAG also had concerns about information that was relevant to capital providers being relevant to those who manage that capital.
• Tony Ward and Ben Warren have been made partners in the utilities and renewable energy team at Ernst & Young UK. Ward has more than 14 years of experience working with the power generation and utility sector. Warren has been with the firm for more than a decade advising clients on renewable energy infrastructure financing, M&A and investor due diligence.
The firm’s markets leader for power and utilities, Steve Jennings, said: “We are focused on increasing our UK presence in the marketplace with a particular focus on alternative energy, transactions and regulation and policy.”
• The Committee of European Securities Regulators has published its 2007 annual report. The committee noted that while much of its work in 2007 was based on longer-term working programmes, it reacted quickly to the market turmoil during the second half of the year and added a number of new key priorities to its work.
• The European Financial Reporting Advisory Group (EFRAG) is seeking comments on proposals to enhance the contribution of Europe to the development of IFRS. The proposals take the current EFRAG structure as a starting point given the short timeframe within which the enhancement needs to occur.
The group is seeking comments on enhancing the EU’s pro-active input to the International Accounting Standards Board by building on EFRAG’s structures and experience; further involvement of National Standard Setters and co-ordination of European resources; the creation of a planning and resource committee; and enhanced governance, transparency and accountability of EFRAG.
NORTH AMERICA, LATIN AMERICA • Deloitte US has appointed Sondra Stokes as a partner in its Securities and Exchange Commission (SEC) services practice. The former SEC associate chief accountant specialises in US and international accounting and financial reporting. Her responsibilities include performing pre-filing reviews of SEC filings, assisting clients with the SEC comment process and providing assistance and interpretive guidance to clients on SEC issues, including the application of IFRS. Stokes joined the SEC in 2001 and became an associate chief accountant in 2004 responsible for interpreting and promoting the consistent application of accounting and reporting requirements within US securities laws.
• Horwath International US member firm Crowe Chizek has admitted 19 new partners. Nine partners were admitted to offices in Indiana.
• The US CPA profession has launched a $15 million programme to help rectify a shortage of accounting professors. More than 70 of the largest US firms, along with several state CPA societies, have committed the money to fund the programme, which will be administered by the American Institute of Certified Public Accountants foundation. According to the institute, the firms will also recruit top employees for the programme and encourage them to become accounting professors in audit and tax.
• US consolidator CBIZ has revealed its 2008 first half revenue was $373.1 million – an increase of 11 percent on the first six months of 2007.
CBIZ chair and chief executive Steven Gerard commented: “The second quarter of 2008 represents the 20th consecutive quarter of same-unit revenue growth for CBIZ.”
• Leaders of 81 of the top 100 accounting firms in the US have visited Capitol Hill to talk to members of Congress about key legislative issues of importance to the accounting profession.
More than 70 meetings were held with House of Representatives and Senate members to discuss issues, including equalising the Internal Revenue Service’s tax preparer standards and taxpayer standards, banning tax strategy patents and promoting uniform interstate income tax requirements. The firms that participated are part of the American Institute of Certified Public Accountants’ major firms group, which consists of many of the US’ 100 largest accounting firms outside the Big Four. This is the first time the major firms group has visited Congress to meet with lawmakers.
• KPMG US has appointed Kevin Martinez as executive director of corporate citizenship. Martinez, 46, brings 15 years of experience in the corporate social responsibility (CSR) field and was most recently vice-president of community affairs at retailer Home Depot and president of The Home Depot Foundation. He will be responsible for directing KPMG’s CSR agenda, including community involvement, charitable giving, environmental issues, pro bono and volunteerism programmes. He will also align KPMG’s internal and external CSR mission, objectives and achievements and chair the firm’s newly established corporate citizenship steering committee.