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SMOs as a driver of successful PAOs: ICPAU’s Experience


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Presentation by Derick Nkajja, Member, Compliance Advisory Panel, for SMO Workshop, February 13, 2016, in San Jose, Costa Rica.

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SMOs as a driver of successful PAOs: ICPAU’s Experience

  1. 1. Page 1 | Proprietary and Copyrighted Information SMOs as a driver of successful PAOs: ICPAU’s Experience Derick Nkajja, Member, Compliance Advisory Panel SMO Workshop San Jose―Costa Rica February 13, 2016
  2. 2. Page 2 | Proprietary and Copyrighted Information Agenda • Introduction • Development of Action Plans • Achievements & Challenges • Overview of the African Region
  3. 3. Page 3 | Proprietary and Copyrighted Information Introduction • The Institute of Certified Public Accountants of Uganda (ICPAU) was established by law in 1992. The current law is the Accountants Act of 2013. • Mandate – To regulate and maintain the Standard of Accountancy in Uganda; – To prescribe and regulate the conduct of accountants and practising accountants in Uganda.
  4. 4. Page 4 | Proprietary and Copyrighted Information Introduction PUBLICATION OF ICPAU’S SMO ACTION PLAN – 1st publication of the Action Plan in December 2008 – 1st Update published in June 2010 – 2nd Update published in September 2011 – 3rd Update published in October 2013 – 4th Update submitted in September 2015
  5. 5. Page 5 | Proprietary and Copyrighted Information Development of the Action Plan • Technical staff review the requirements of IFAC SMOs • Technical staff support ICPAU departments in drafting the plans to achieve SMO requirements • Action plan reviewed by Management Team • Action plan approved by Chief Executive • Action plan endorsed by Council and shared with Council Committees
  6. 6. Page 6 | Proprietary and Copyrighted Information SMO 7: IFRS SMO 3: ISA SMO 5: IPSAS SMO 2: Education SMO 4: Ethics Building Blocks The Framework
  7. 7. Page 7 | Proprietary and Copyrighted Information Quality Assurance Educations and Examinations Standards Compliance Awareness Achievements
  8. 8. Page 8 | Proprietary and Copyrighted Information Quality Assurance • A Quality Assurance Programme (QAP) has been strengthened. • The QAP is conducted in three-year cycles – 1st cycle was completed in February 2010. – 2nd cycle completed in March 2014. – 3rd cycle is on, so far, reviewed 70 out of 206 firms.
  9. 9. Page 9 | Proprietary and Copyrighted Information Quality Assurance • Notable progress; – Improvement in audit quality as years go by. – Introduction of a Practice Management Course in 2013 to address skills gaps identified through the QAP. – Introduction of a Quality Assurance Board (QAB) to enforce professional standards and to enhance quality assurance.
  10. 10. Page 10 | Proprietary and Copyrighted Information Education & Examinations • Introduction of regular reviews for ICPAU examinations courses - SMO2. • Stakeholder confidence in CPA course. • Engagement of tuition providers.
  11. 11. Page 11 | Proprietary and Copyrighted Information Examinations & Standards • Initial Professional Development – The professional standards are incorporated in the ICPAU courses. [Both Certified Public Accountant (CPA) course and Accounting Technician Diploma (ATD) course]. – IFRS, ISAs, IPSASs and IESBA Code are examinable in both CPA and ATD course.
  12. 12. Page 12 | Proprietary and Copyrighted Information Standards • All professional standards (IFRSs, ISAs, IPSASs) were adopted by ICPAU. • To support implementation, – training is conducted regularly. – Handbooks are regularly made available to members. • Generation of responses to Exposure Drafts and Consultation Papers. • IESBA code is implemented alongside the ICPAU Code.
  13. 13. Page 13 | Proprietary and Copyrighted Information Standards – FiRe Awards • Introduction of Financial Reporting (FiRe) Awards in partnership with the Uganda Securities Exchange and the Capital Markets Authority – FiRe awards conducted for the last five years. – To gauge and monitor implementation of standards – Aim at enhancing the quality of financial and business reporting in Uganda.
  14. 14. Page 14 | Proprietary and Copyrighted Information Compliance • ICPAU’s Investigations and Disciplinary guidelines developed and published in 2013. – Staff recruited to handle investigations and ensure compliance with SMO 6. • ICPAU continues to enhance public awareness of its Disciplinary Committees mechanism and results.
  15. 15. Page 15 | Proprietary and Copyrighted Information Awareness • ICPAU continues to; – Raise awareness of SMO requirements and benefits derived there from, to stakeholders. – Appreciate the role of the Compliance Advisory Panel. – Greatly get involved in IFAC activities • Ease in signing off East Africa Community Institutes of Accountants (EACIA) Mutual Recognition Agreement due to similar approach to the profession.
  16. 16. Page 16 | Proprietary and Copyrighted Information Challenges to SMO Action Plans • Enabling legislation for implementation of all standards. • Greater public expectations compared to professional demands. • Resource constraints. • Increased regulatory demands worsening the resource constraints. • State of Economic environment.
  17. 17. Page 17 | Proprietary and Copyrighted Information Overcoming Challenges • ICPAU adopted a mentorship approach to all its activities. – ICAS was chosen as a twinning partner (mentor) with the support from Uganda Government. – The relationship has helped to strengthen the Institute’s organs. • Sourcing sponsorships for ICPAU events & activities. • Be contented with the natural growth/progression of the profession according to the economic development of the country.
  18. 18. Page 18 | Proprietary and Copyrighted Information Overview of Africa Region • The profession is brought together by Pan Africa Federation of Accountants (PAFA) – With 43 members from 36 countries. – Only 26 PAFA members are participating in SMO Action Plan. • Not all PAFA members are IFAC members. • Regulatory framework is very diverse • Multiple languages used
  19. 19. Page 19 | Proprietary and Copyrighted Information Challenges and Initiatives in Africa • Challenges – Enabling laws – Low levels of private sector economic activities – Resource Constraints & Brain Drain. • Initiatives – Collaborations along economic blocs – Mutual Recognition agreements
  20. 20. Page 20 | Proprietary and Copyrighted Information Conclusion • The development and implementation of the SMO Action Plan has guided ICPAU’s professional activities and development. • Challenges and constraints notwithstanding, ICPAU and PAFA members continue to promote SMO framework as part of the profession’s contribution to the growth and development of strong economies.