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IAESB Standards Development & Initiative: Information and Communication Technology

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International Accountancy Education Standards Board Member Dr. Sidharta Utama spoke during the Association of Chartered Certified Accountants (ACCA) Regional Education Conference in Singapore in September 2017 and discussed IAESB initiatives on developing professional accountants’ information and communications technology skills and competency.

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IAESB Standards Development & Initiative: Information and Communication Technology

  1. 1. Page 1 | Proprietary and Copyrighted Information Standards Development & Initiative: Information and Communication Technology Sidharta Utama Member, International Accounting Education Standards Board ACCA Regional Education Conference, September 13 2017, Singapore
  2. 2. Page 2 | Proprietary and Copyrighted Information Outline • Introduction to IAESB • IAESB Strategy 2017 – 2021 • Standards development initiative: Information & Communication Technology (ICT) – Background, Objective, Scope – Progress: Literature Review & Survey – Targeted milestones
  3. 3. Page 3 | Proprietary and Copyrighted Information IAESB • Serves the public interest by establishing standards in the area of professional accounting education • Prescribes technical competence and professional skills, values, ethics, and attitudes. • Enhances education by developing and implementing International Education Standards™ (IES™), which increase the competence of the global accountancy profession— contributing to strengthened public trust. What is the IAESB mandate?
  4. 4. Page 4 | Proprietary and Copyrighted Information Benefits • Provides industry-specific accounting knowledge and skills • Promotes compliance to a high standard of conduct and professionalism • Enhances organizations chances of adapting to changes in business and technology Qualification, Certification & Licensure Standards& BestPractices Continuing Professional Development IESs 7 & 8 Assessment IES 6 Practical Experience IES 5 Content of Professional Accounting Education IESs 2, 3, 4 Entry Requirements IES 1
  5. 5. Page 5 | Proprietary and Copyrighted Information Developing Professional Competence INDIVIDUAL ASPIRING PROFESSIONAL ACCOUNTANT PROFESSIONAL ACCOUNTANT IES 1 IES 2 – IES 6 CONTINUOSLY IMPROVING PROFESSIONAL ACCOUNTANT IES 7
  6. 6. Page 6 | Proprietary and Copyrighted Information IESs 2, 3, & 4 Technical Competence (IES 2; 2015) Professional Skills (IES 3) Professional Values, Ethics, and Attitudes (IES 4) Content of Professional Accounting Education
  7. 7. Page 7 | Proprietary and Copyrighted Information Standards Development Focus on the following areas: • Continuing professional education • Professional skepticism • Public sector accounting, reporting and assurance • Information and communications technology
  8. 8. Page 8 | Proprietary and Copyrighted Information 1. Analyze the adequacy of general information technology controls and relevant application controls 2. Explain how information technology contribute to data analysis and decision making 3. Use information technology to support decision making through business analytics IES 2: Learning Outcomes for Information Technology Competence Area (Intermediate Level)
  9. 9. Page 9 | Proprietary and Copyrighted Information Increasing pace of change in ICT Transform the operational and interpretative aspect of accountancy May change competency requirements for professional accountants ICT Standard Development - Background
  10. 10. Page 10 | Proprietary and Copyrighted Information Objective Serve the public interest by identifying the ICT skills needed by aspiring professional accountants and professional accountants to perform their role competently in a digital economy
  11. 11. Page 11 | Proprietary and Copyrighted Information Scope Results of evidence gathering process to determine if: • ICT advancements requires new or revised competencies area • Existing competence areas are sufficient to support needs of professional accountants Standards development may include: • amending extant IESs competence areas • adding specific competence areas • adding explanatory materials within extant IESs • developing new IESs or • providing more guidance * Through literature review, stakeholder engagement with IFAC member bodies, accounting firms, academics as well as liaising with other Standard Setting Boards
  12. 12. Page 12 | Proprietary and Copyrighted Information • Growing demand for advanced IT knowledge and skills for accounting professionals, for example: – AACSB International Accounting Accreditation Standard A7 (2016): “consistent with the mission, accounting degree programs integrate current and emerging accounting and business statistical techniques, data management, data analytics and information technologies in the curricula.” • Improvement in soft-skills necessary to capture the benefits of ICT knowledge, for example: – ‘accounting students need to be trained as informed skeptics in the area and need to be able to understand the limits of “measurement and representation, the subjectiveness of insight, the challenges of statistics and integrating data sets, and the effects of underdetermination and inductive reasoning” McKinney, Yoos and Snead (2017) Implication to the accounting profession (Based on Literature Review by Birt)
  13. 13. Page 13 | Proprietary and Copyrighted Information Areas of Focus in ICT Business Acumen Behavioral Competence Digital Technologies Data Interrogation, Synthesis and Analysis Communication
  14. 14. Page 14 | Proprietary and Copyrighted Information Survey Results on ICT Skills – Background of Respondents Number of Respondents (n = 192)
  15. 15. Page 15 | Proprietary and Copyrighted Information Agree Disagree No Opinion Responses ICT skills “disruption” has the potential to affect all professional accountants performing a variety of roles. 180 94.2 % 9 4.7% 2 1.0% 191 Advances in technology pose a challenge to the existing ICT skills of professional accountants. 173 91.5% 12 6.3% 4 2.1% 189 The IAESB should consider ICT skills in the context of current and future skills needs. 184 95.8% 3 1.6% 5 2.6% 192 ICT skills consideration needs to focus on Initial Professional Development (IPD) of aspiring professional accountants and Continuing Professional Development (CPD) of professional accountants. 180 94.2% 2 1.0% 9 4.7% 191 ICT skills includes an understanding of different technology platforms (software and hardware) and how the use of technology impacts the professional accountant’s role. 181 94.3% 5 2.6% 6 3.1% 192 Does your organization agree with the following statements?
  16. 16. Page 16 | Proprietary and Copyrighted Information No. Areas Average Score 1. Data Interrogation, Synthesis and Analysis 4.7 2. Behavioral Competence 4.6 3. Business Acumen 4.5 4. Communication 4.5 5. Digital Technologies 4.4 In the context of a professional accountant’s future ICT skills needs, how important is each of these areas? (Likert scale 1 to 5)
  17. 17. Page 17 | Proprietary and Copyrighted Information What does your organization see as the most important standards development activities to support skills development of professional accountants in ICT? Percent Responses (a) Amending existing International Education Standards (IESs) competence areas or learning outcomes 34.8% 48 (b) Adding new specific competence areas or learning outcomes to existing IESs 44.2% 61 (c) Considering additional explanatory material within IESs 35.5% 49 (d) Developing new IESs (whether multiple or a standalone ICT IES) 24.6% 34 (e) Providing guidance 45.7% 63 (f) All of the above 32.6% 45 (g) None of the above 0.7% 1 Other (please describe) 2.9% 4
  18. 18. Page 18 | Proprietary and Copyrighted Information Timeline November 2017 meeting Discussion of final project scope issues and project proposal 2nd Quarter 2018 Identification of ICT skills and a gap analysis of such skills with the IESs Targeted Milestones
  19. 19. Page 19 | Proprietary and Copyrighted Information www.iaesb.org Information
  20. 20. Page 20 | Proprietary and Copyrighted Information • Birt, J. (2017), ICT Literature Review, working paper • IAESB (2015), IES 2: Initial Professional Development – Technical Competence • IAESB (2017), General survey results on ICT • IAESB (2017), Strategy 2017-2021 and Work Plan 2017- 2018, March. References

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