The Accounting Practices Committee (APC) is revising the process of issuing local Statements of Generally Accepted Accounting Practice (GAAP). As part of this process they intend to clean out the AC 300 series Opinions and, where required, replace such Opinions with an AC 500 series Interpretation.
The AC 300 series are opinions issued by the Accounting Issues Task Force, established by the South African Institute of Chartered Accountants (SAICA), in order to provide a forum for timely review of accounting issues that are, or could be subject to divergent, or unsatisfactory treatment in practice. Task force opinions do not override principles established by Generally Accepted Accounting Practice (GAAP) in the AC 100 and 400 series, but offer guidance to preparers, auditors and users of financial statements, thus facilitating the standardisation of accounting treatments.
The AC 500-series pronouncements will be approved for issue by the Accounting Practices Board and will have the same authority as the AC 100 series Statements of GAAP and AC 400 series Interpretations.
Most of the AC 300 - series Opinions have subsequently been withdrawn and the first two proposed AC 500 - series pronouncements are now being exposed for public comment.
GAAP Monitoring Panel
The South African Institute of Chartered Accountants approved the principles of an arrangement with the JSE Securities Exchange to monitor financial statements of listed companies, with a view to taking action against companies which do not comply with the requirements of accounting standards.
Joint Disciplinary Task Team
In the light of the recent corporate failures, the SAICA, together with the Public Accountants and Auditors' Board (PAAB) recently joined forces to form a Joint Disciplinary Task Team to review the disciplinary process of the accountancy profession. The decision to form the task team was the result of the SAICA board's decision in 2001 to tighten up on the disciplinary processes of the profession.
The Task Team was given a broad mandate to review the current disciplinary processes of the two organisations in order to recommend improvements and harmonisation in the public interest. The mandate included consideration of the following specific issues:
- The ability to obtain and subpoena evidence and witnesses, both by a statutory body and a voluntary association.
- How the disciplinary needs of both SAICA and the PAAB can be met without double trials.
- The credibility of the process in the eyes of both the public and the members of both bodies.
- The acceptability of 'plea-bargaining' as a mechanism for improving the efficiency of the process.
- The optimum level of resources needed to be able to conduct the process effectively and the level of expenditure needed to sustain the process
- The appropriateness of sentences imposed by both bodies in the light of current society norms
- The composition of the committees taking into account the availability of volunteers and the trend towards longer and more complex hearings
- The increasing difficulty of proving cases and the adequacy of evidence
- If and how the processes can be accelerated.
The Task Team, which has been meeting since January 2002 has issued a final report to be considered by the respective boards of SAICA and PAAB.
In accordance with the recommendations of the task team, the report has been made available for the information of members.