IFAC at 30: a job well done

IFAC is 30 years young. Calum Robson asks ACCA members - some of whom qualified in 1977, others who were born then - for their thoughts on how the organisation has shaped the profession, and what its priorities should now be

Founded in October 1977, IFAC's mission was to 'strengthen the worldwide accountancy profession in the public interest'. At its inception, ACCA and 62 other professional accountancy bodies from 51 countries signed up to the constitution.

Since then, membership has more than doubled, with 155 bodies in 118 countries. And while the infant organisation's goals revolved around developing standards in education and auditing, facilitating co-operation and acting as the profession's spokesperson, IFAC's remit today covers an array of activities from regulation and financial reporting of the public sector to small and medium practices, developing nations and ethics.

ACCA has over the years played an important role in IFAC's activities - culminating in last year's Diamond Sponsorship of the World Congress of Accountants in Istanbul, organised by the Turkish profession. ACCA members sit on several important committees.

Allen Blewitt, ACCA's chief executive, says of ACCA's sponsorship of the 2006 World Congress: 'For ACCA, the Diamond Sponsorship of the World Congress in Istanbul was an outstanding opportunity to demonstrate to the global profession that we are a significant player in contributing to the growth and reputation of the profession worldwide. ACCA is the only truly global accountancy body by nature of its standardised global curriculum and its spread of offices. This message was understood and reinforced by our Diamond Sponsorship and our many speakers who contributed to the success of the Congress on our behalf. Most recently, as another global initiative, ACCA ran a high profile seminar in Hong Kong on sustainability reporting and climate change reporting with Vice President Al Gore. Again, ACCA is demonstrating to the global profession that we are a leader on today's and tomorrow's reporting issues and we are prepared to demonstrate that leadership with world leaders in support. In our view, the whole question of climate change reporting is one of the top public policy and business policy issues facing the world over the next decade. We are determined to remain at the forefront of the debate on this subject, which is clearly in the public interest, whichever country one lives in.'

ACCA is currently represented on IFAC's main board, as well as its Developing Nations Committee, the International Public Sector Accounting Board, the Professional Accountants in Business Committee, the International Accounting Education Standards Board and the Small and Medium-Sized Practices Committee.

Blewitt says of its relationship with IFAC: 'ACCA and IFAC have developed strongly in the last 30 years. IFAC has made a considerable impact on improving the overall reputation and standing of the accounting profession. In particular, they have helped re-build the reputation of the profession after the Enron/ WorldCom reputational crises some years ago. IFAC's emerging role as an independent standard setter acting in the public interest has grown year by year. ACCA has been a founding member of IFAC and actively involved in its activities at multiple levels including the Board, the Developing Nations Committee, the SME/ SMP Committee and the Education Standards Board. ACCA's multi-faceted participation has been particularly advantageous for our international reputation.

Commenting on ACCA's contribution to IFAC, Blewitt says: 'On reflection, I think the most significant contributions that ACCA has made to the activities of the global profession working to IFAC has been through the Developing Nations Committee and the SME/ SMP Committee. We have been long-term champions of both these areas of activity, and now IFAC has moved to develop much more tangible outputs to assist both of these constituencies. For example, in relation to the developing nations, IFAC is producing materials which assist developing nations to develop their own accountancy body and we have also acted to improve the standard of regulation in oversight in a range of developing economies. On the SME/SMP agenda, we have again promoted the fact that the vast majority of professional accountants work in and for the SME/SMP community, and IFAC, therefore, has a very strong responsibility to meet the needs of these millions of professional accountants and also provide guidance and advice, as well as commenting explicitly on standards, many of which have been set for the capital markets rather than small and medium enterprises.'

Contributing through communication

Work towards developing international standards has been a major factor in bringing about closer co-operation between the world's accounting bodies. Danny Goon, who became an ACCA member in 1977, remembers a profession that was fairly disparate when he began his studies at the start of the 1970s. 'One of the most positive benefits I've noticed has been the way the profession has evolved worldwide as a unit,' he says. 'Through IFAC, accountants are now able to speak with one voice.'

That co-operation has strengthened IFAC's ability to support developing economies - and nowhere has that been more apparent than in China, where IFAC's board met for the first time in 2006, recognising the country's greater prominence and participation in IFAC activities since the Chinese Institute of Certified Public Accountants joined in 1997.

Binhua Zhou, a 30-year-old who is witnessing China's resurgence first-hand through his work with PricewaterhouseCoopers in Shanghai, says: 'The launch of IFAC coincided with the beginning of reforms of our country's economy. Thirty years on, it's now accepted that we should move towards international standards, something which IFAC has strongly supported.'

Growing globally

Few organisations can match the passion with which ACCA has embraced IFAC's commitment to inclusion and its mission to strengthen the worldwide profession. 'The really big thing about ACCA is the way it's developed internationally,' says Philip Easter, who qualified in 1977 and is now CFO of Aviva USA. 'I've had teams working for me in Sri Lanka and India, and I've seen how accountancy has liberated people who've been introduced to a new world of opportunity. ACCA's global growth has allowed people in emerging economies to move forward in leaps and bounds.'

One of IFAC's main activities is to set and promote standards for accountancy education and training, and ACCA is currently represented on its International Accounting Education Standards Board. Ellie Griffiths, an education adviser for ACCA, says: 'I was involved in developing the syllabus for our new professional qualification, and obviously had to be mindful of IFAC's guidelines and best practice.

'The most welcome development for me has been the introduction of ethics into the papers. It's imperative that qualified accountants stand up for what's right, not just what's technically good - the last thing we want is for the reputation of the profession to be eroded.'

Responding to crisis

Yet it was a major threat to that reputation that saw IFAC looked to by accountants and the public at large in the wake of financial scandal on a phenomenal scale in 2001 - when the subject of ethics in accountancy began its drive to the top of the agenda in boardrooms, regulatory bodies and indeed governments across the world.

'After Enron, there was a tremendous lack of trust amongst the public,' says Griffiths. 'IFAC has been fantastic in developing and promoting ethical standards to give them back the confidence that the books aren't going to be fudged. The introduction of CPD as a requirement of membership has also helped, as everyone now has to keep up-to-date - and to be seen to be doing so.'

Noel O'Connell, who became a member in 1977 and is now director of audit for local government in Ireland, welcomed IFAC's contribution to restoring trust. 'IFAC has driven the profession to learn from past mistakes,' he says. 'If we don't learn those lessons, we risk being unable to uphold our reputation.'

Looking forward

A revised Code of Ethics for Professional Accountants (2005) - the result of extensive consultation with member bodies and stakeholders - and its subsequent adoption and implementation means that a focus on professional standards is here to stay. But what other issues do ACCA members think IFAC should address?

Zhou would like more developing countries to see the economic benefits of advanced accounting and financial management systems, in the same way that China is doing today: 'IFAC has a range of goals, of course, but I would like to see wider development of the profession internationally.

'ACCA has done an excellent job through assisting professional bodies in countries where the profession is not as advanced. I look forward to seeing this become a greater priority.' With two representatives on IFAC's 18-strong Developing Nations Committee, ACCA already has an influential voice.

O'Connell - whose organisation was the first in Ireland to gain an award from ACCA as an Approved Employer for professional development - wants to see CPD continue to be championed: 'Accountants should keep up to speed. I'm a big believer in ongoing training for everyone, including myself - as a leader, I say you have to put yourself under pressure and set an example.'

Critics say more work needs to be done to improve the infrastructure of the profession itself. 'We have a challenge to improve self-regulation and minimise the intervention of oversight boards,' says Goon. 'Accountancy bodies have occasionally been reluctant to police themselves and their members. That has to be addressed.'

And he is keen to stress that work still needs to be done to improve education. 'The role of educators is to help keep new starters on the straight and narrow,' he says. 'The accounting profession should stand for integrity and credibility - values that were visibly compromised by financial scandals in recent years. So we have to act almost like evangelists, stressing to them that the big issue isn't who is the most wealthy or the most socially able, but who has the most credibility and integrity.'

Easter believes the spotlight should be turned on technology. With advances in IT - web-based technologies in particular - bringing benefits that no one could have dreamed of 25 years ago, he regards it as a major challenge for accountants in practice, in business and in government: 'We have to ask ourselves: how is the profession going to be even more effective? We need to think outside the box - about the impact of technology and what it means for how we move forward. We need a technical R&D team which anticipates technological issues and helps us stay ahead by transforming how the profession operates.'

One thing is for sure: ACCA will continue to play an enthusiastic role. Ian Ball, IFAC's chief executive officer, says: 'As a founding member of IFAC, ACCA has a 30-year history of supporting IFAC in its mission of strengthening the global profession and promoting quality performance by professional accountants worldwide.

'We are especially grateful to the leadership of ACCA for its contributions to our boards and committees, and for its commitment to and investment in the profession in the developing world.'

Calum Robson is a freelance writer.