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IOSCO releases IFAC Monitoring Group report

09 Nov 2010

The International Organization of Securities Commissions (IOSCO) has publicly released Review of the IFAC Reforms — Final Report.

The report was produced by the Monitoring Group into the so-called 'IFAC Reforms' aimed at strengthening the international auditing and assurance standards process to bolster public confidence in the work of auditors and in the financial reporting process.

The Monitoring Group is a consensus-based group of the regulatory and international public interest organisations responsible, inter alia, for monitoring the implementation of the IFAC Reforms. The members are the Basel Committee on Banking Supervision, the European Commission, the Financial Stability Board, the International Association of Insurance Supervisors, IOSCO and the World Bank. The International Forum of Independent Audit Regulators (IFIAR) is an observer. The Monitoring Group is chaired by IOSCO.

The IFAC Reforms were agreed by International Federation of Accountants (IFAC) in 2003 and included a more transparent audit and assurance standard setting process and the establishment of the Public Interest Oversight Board (PIOB) to oversee IFAC's public-interest activities. Our original story about the reforms, with more detail, is available here.

A summary of the report's recommendations is set out below:

Matters of Past Implementation: Virtually all of the changes called for by the Reforms have been implemented.

Matters for Near Term Action: There are several near term matters that are within the context of the Reforms which would bring enhancements to the standard-setting, oversight and monitoring work and thus further the aims of the Reforms with respect to diversity, transparency and accountability. Recommendations include changes to the appointment of, and information about, IFAC Boards members, the role of technical advisors, and the transparency of standard-setting processes.

Matters for Longer Term Analysis: There are two longer term matters that go beyond the context of the Reforms which the Monitoring Group will keep under review and consideration. These include the efficacy of standard-setting Boards operating within an accountant's professional membership organisation and whether monitoring groups for audit-related standards and international financial reporting standards should be combined.

Click for Review of the IFAC Reforms — Final Report (link to IOSCO website).

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