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IFAC paper IEPS 2.1

Comments from ACCA
November 2006

General Comments

ACCA was asked to comment on the following three questions.

1. Is the document still helpful to member bodies in addressing the requirements of IES 2 and other International Education Standards? If you feel the document is not helpful please explain what needs to be addressed.
2. Do you consider the updated lists of knowledge/skills areas, topic coverage, competences and competence elements contained in Appendices 1-6 are sufficiently comprehensive? Please explain
3. IEPS 2.1 acknowledges that in real work environments member bodies may have had difficulty in requiring professional accountants to develop competence in one of three specific roles, (in addition to the user role) outlined in IES 2. In addressing this, IEPS 2.1, (paragraph 15) suggests that member bodies may wish to suggest other roles (e.g. an advanced user role). Is this a helpful concept?

ACCA recognises that IEPS 2.1 is a very comprehensive and detailed document that covers a wide range of IT aspects relating to the main roles identified in IES 2.

ACCA suggests either a considerable reduction in the content (particularly in the appendices) or a change in how it is presented. If the content in the appendices is to remain, ACCA recommends that some form of hierarchical referencing system be used within the appendices to give better guidance about how essential or peripheral/specialist some of the IT competences are.

ACCA suggests that the IEPS gives some additional guidance on the different ways in which the IT areas are best covered, as referred to in paragraph 33 of IES 2, so that member bodies are given a measure of reassurance that much of the IT content is either not mandatory, or if it is, that it is best covered in work experience or at some point during continuing professional development (CPD).

As far as the third question is concerned, ACCA recommends that while there may be a need to recognise the difficulty in demonstrating some of the competences in the other IT roles, this issue is not best addressed by supporting an 'advanced user' role, on the grounds that the existing user role may already be sufficient, or could be extended or redrafted to make it so.

ACCA supports the view that IES 2, and therefore the IEPS, should not specify that on qualification professional accountants must demonstrate competence in the user role and one other, but just require demonstration of competence in the one role, as a user, but in different capacities.

Specific Comments

QUESTION 1

Is the document still helpful to member bodies in addressing the requirements of IES 2 and other International Education Standards? If you feel the document is not helpful please explain what needs to be addressed.

ACCA believes IEPS 2.1 gives comprehensive guidance to professional accounting bodies in accordance with the requirements of IES 2. Nonetheless, the paper may need to specify more clearly (as does the Ethics paper) how these competences can be acquired and demonstrated. It could also more clearly indicate that these competences can be acquired from a range of areas (as per Paragraph 33 of IES 2). The paper should also recognise that although different IT roles are identified, there is scope for considerable overlap between these roles, particularly between the user role and the others.

ACCA believes that some paragraphs in IEPS 2.1 could be more specific with reference to IT; for example, paragraph 21 and the paragraphs 23–27 on the whole area of control competences.

These latter paragraphs could be improved by containing an introductory passage explaining broadly what IFAC means by IT control knowledge and competences. It would be beneficial if the IEPS elaborated on IES 2 in this area, as the IES deals with this only in broad terms. The emphasis on control competences in the IEPS is consistent with the requirements of IES 2, but the IEPS does not elaborate or expand on the IES 2 coverage in the context of the application of controls to personal systems.

The assumption is that the accountant will require IT control competences mainly in the role of assurance provider and evaluator, or possibly in compliance and internal control, but some control competences could also fall under particular user roles.

IES 2 in Section 30 requires competence in a 'user' role and 'at least one of' the roles of manager, designer and evaluator, or a combination thereof. It is made clear in Paragraph 33 of IES 2 that these competences can be obtained:

• by integrating IT into the organisational and business knowledge component
• by integrating IT into the accounting and accounting-related knowledge component
• through pre-qualifying work experience
• through post-qualifying continuing professional development, i.e. specialist IT courses or qualifications.

Paragraphs 37 and 42 of IEPS 2.1 also point out that the qualified accountant needs a knowledge and understanding, not proficiency in IT – which suggests that there would be no requirement for a discrete high-level examination paper in IT to meet these requirements. These areas could be developed through integrating IT in other subject syllabuses, and/or through work experience requirements and in continuing professional development.

ACCA therefore suggests that this aspect of IES 2 should be made more explicit in the IEPS 2.1 document to give better guidance and reassurance to member professional bodies.

Neither IES 2 nor IEPS 2.1, recognises that some very basic IT knowledge and skills identified in the IEPS 2.1 appendices could be assumed to have been acquired pre-registration, either from school or college education, in the same way that basic numeracy and linguistic skills are assumed, other than for matriculation purposes. Examples of this would include communication supported by IT , such as emails, data communication devices, physical storage devices , such as memory sticks and infrared, and some basic office software , such as word processors and basic spreadsheets. ACCA suggests that this point about assumed minimum levels of IT competence could be added.

The IEPS contains several references to assurance provider/evaluator, which indicates that the IEPS more readily recognises the link between IT function/competences and audit and assurance than does IES 2, specifying the obvious links with IES 8 requirements.

ACCA supports this, as it is likely that this will be a significant area, where IT competences are demonstrated by a large group of accounting professionals, but ACCA advises IFAC to ensure that there is sufficient cross-referencing between what is written in this paper on evaluation and assurance with what is contained in IES 8.

ACCA therefore considers that IEPS 2.1 does more than meet the requirements of IES 2, but possibly in a different way to that originally intended or envisaged. As far as content is concerned it covers everything specified in the education standard, although ACCA recognises that the standard may not have intended the IT coverage to be so detailed and specialist. The only aspect of IES 2 that the paper does not adequately deal with is the emphasis, in Paragraph 33 of the standard, on specifying how much IT coverage can be achieved in different ways, how much is expected to be taught within an education syllabus and how it is to be demonstrated.

QUESTION 2

Do you consider the updated lists of knowledge/skills areas, topic coverage, competences and competence elements, contained in Appendices 1-6 are sufficiently comprehensive? Please explain.

ACCA advises that although the main body of the paper is broadly appropriate and certainly comprehensive, the appendices and their sheer volume may encourage professional accountancy bodies to assess more IT than would be advisable, within their educational qualifications.

ACCA therefore suggests, as mentioned above that the paper could emphasise more strongly that many of the knowledge areas and competences in the appendix could well have been acquired before, during and after completing exams, from pre-professional education and training, from work experience and from continuing professional development.

ACCA advises that the appendices should not drill down into as much detail, or that it might be better for outcomes to be coded as essential , useful , or specialist , on a 3,2,1 basis for example.

The above is consistent with Paragraph 10 (bullet 2) where it says 'Some IT user skills are indispensable '. The paper could also give some guidance on whether to cover these areas (p) pre-registration, in (e) educational assessment (t) pre-qualifying training and work experience, or as (d) continuing professional development (CPD).

ACCA considers that many of the Manager and Designer role competences listed may be too specialist to be covered in an accounting qualification syllabus. These areas within Appendices 5 and 6 relating to the Manager and Designer role could be specified as optional, or for CPD only, depending on the role of the accountant at work.

The appendices themselves are structured differently for the knowledge and competences areas, presumably to distinguish between education capabilities (inputs) and competence at work (outputs). Is this really the intention? If so, it might be reasonably assumed by qualifying bodies that areas referred to in Appendices 3–6 are best covered only as part of the work experience requirement, or in CPD. If this is not the case then this needs clarification. The general point remains, however, that the appendices are probably too long and probably contain too many detailed technical and specialist IT areas, many of which only very few accountants would ever need.

Paragraph 11 also recognises that more advanced knowledge can be obtained from more specialised training at work, which again would indicate that much of the content of the appendices relating to the main roles (including some control competences and particularly the manager and design roles) are best covered within work experience while training, or more appropriately in CPD, where accountants working in IT environments can pursue specialist IT courses and qualifications.

Although the IEPS 2.1 appendices are helpful in that they provide the detail where it could be required for IT syllabus development, arguably they would be more helpful for professional bodies offering specialist IT qualifications than for those offering professional accountancy qualifications.

ACCA therefore considers that the appendices may give the wrong impression about how much of this needs to be covered in an accounting education curriculum. This is despite the fact that the IEPS acknowledges in paragraph 13 that accountants will perform IT roles at different times in their career and not necessarily sequentially.

ACCA also holds the view that there may be a greater danger that such detailed emphasis on IT content in this paper may not be matched by an equivalent detailed emphasis on a recommended minimum curriculum in the other core technical accounting and organisational and business areas outlined in IES 2. This may send out the wrong message about the relative importance of IT content against other, arguably more mainstream, technical content, on which employers are asking for more emphasis.

QUESTION 3

IEPS 2.1 acknowledges that in real work environments member bodies may have had difficulty in requiring professional accountants to develop competence in one of three specific roles, (in addition to the user role) outlined in IES 2. In addressing this, IEPS 2.1 (paragraph 15) suggests that member bodies may wish to suggest other roles (e.g. an advanced user role). Is this a helpful concept?

The question about the 'advanced user' role may have been posed in response to earlier feedback indicating that most accountants could find it difficult to demonstrate IT competences in any capacity other than within the user role. This view supports the findings from ACCA's competences survey in 2005, suggesting that while stakeholders, such as employers, believed that IT was important, the most important aspects mentioned were for accountants to have 'hands-on' proficiency with accounting software, such as spreadsheets, and to be able to use computerised accounting systems, as users.

ACCA recognises that the 'advanced user' concept may be useful for some professionals, who may find it difficult to demonstrate knowledge and competence of roles other than the user role. Nonetheless, the example of using an advanced spreadsheet, given in Paragraph 15, may not be the most appropriate, as this competence is probably implicit within the normal user General IT knowledge area ( See Software for professional use ) and in IT control competences. (See Apply appropriate IT systems/tools to business/accounting problems ).

ACCA therefore advises that for the 'advanced user' role to be better understood, more justification for this concept may be needed.

ACCA supports the view that if other feedback indicates that the requirement to demonstrate competence in the user and one other role is unrealistic, it may be advisable to revisit this IES 2 requirement and to widen the user role, rather than create an 'advanced user' role.

As written, the user role competences seem to be no more than a range of accounting-related job roles within which to demonstrate IT user knowledge and competences, i.e. as financial manager, financial controller, tax or insolvency practitioner and information analysts. ACCA believes there may be scope to widen this set of roles to include other finance-related roles, and to specify which functions and responsibilities within these roles would provide the best opportunities to demonstrate IT user knowledge or competence, rather than using the 'advanced user' concept.

It might be feasible that some of the broader competences within the assurance and evaluator and the manager roles, if not the designer role, would fit more appropriately under the user role.

On balance, ACCA would not object to an 'advanced user' role if it made compliance with the standard more achievable, but would prefer a redrafting of the user role to widen its scope to specify accounting-related areas where a range of IT knowledge and control competences may be found, and where accounting professionals could more feasibly demonstrate these at work or through CPD, wherever they were employed.

ACCA therefore advocates the concept of a 'wider' user role rather than an 'advanced user' role, on the basis that what is already included under the user role seems sufficiently advanced already, or that competences included under some of the other roles could be included here.

ACCA would prefer it if the paper helped students and members more readily identify the specific roles and responsibilities where they already use or can potentially develop IT knowledge or competence as users, rather than their having to justify competence in specialist areas such as Manager and Designer.

ACCA's view is that these other roles would normally lie firmly in the domain of trained IT specialists, from whom accountants would normally seek support and advice, but in whose specialisms they do not need expertise themselves.

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