News from CGA-Canada
FROM: SEP-OCT 2006 ISSUE
CPAB Accepts Independence Standard
The Canadian Public Accountability Board (CPAB) has announced its acceptance of the CGA Independence Standard, which was developed in 2004 to strengthen accountability and public trust in financial reporting. The rule change came into effect on June 20, 2006.
The announcement was welcomed by CGA-Canada President and CEO Anthony Ariganello, FCGA, CPA (Delaware), who said: "Already acknowledged by the CGA Code of Ethical Principles and Rules of Conduct (CEPROC), this rule change requires CGA firms that are participants in CPAB's oversight process to adhere to the CGA Independence Standard. We are pleased the standard has been endorsed and that CGAs will continue to provide high quality assurance services under CGA rules."
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Application for Review Proceeds
CGA-Canada's Application for Judicial Review, filed with the Ontario Superior Court Justice on May 9 to address long-standing concerns regarding CPAB's structure and processes, is proceeding.
Ever since the creation of CPAB in 2002, CGA-Canada has maintained that the oversight body requires a fully transparent process for deliberations and decisions; procedural safeguards to ensure an arms-length relationship between the CPAB Board and the accounting/auditing profession; broad representation on the Board; broadly based funding; and legislative accountability.
The Application for Judicial Review seeks to have the Court rule that CPAB is a public body and its composition must be representative of all accounting organizations that are affected by its decisions. To read the application, go to www.cga-online.org/canada.
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No Increase to Insurance Premiums
For the first time in several years, there is no increase to CGA professional liability insurance premiums for public practitioners. In addition, reliance on the Association's Reserve Fund, which is used to subsidize premiums and offset the effect of increases, was reduced. Another factor positively affecting premiums this year is the new partially self-funded framework implemented by the Professional Liability Insurance Committee. The framework allows the Association to experiment with self-funding without subjecting practitioners' coverage to undue risk.
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PA Courses Enhanced
For students, the introduction of the new Professional Applications 2 (PA2) course and examination this fall means more than just another certification examination to write. It also means important changes to the structure and content of the PA1 and PA2 courses.
Until now, new content was not introduced in PA1, as the focus was on integrating and applying content learned in previous CGA courses. The PA1 and PA2 courses will continue to focus on the application of accounting knowledge and skills; however, the two courses will approach the material from different perspectives. Issues in Professional Practice (PA1) considers the perspective of an accountant external to the organization providing business advisory or audit services. Strategic Financial Management (PA2) considers the perspective of the financial manager within the organization.
Both courses are consistent with the Association's competency-based approach to education, as assignments assess students' abilities to apply specific competencies. In addition to the current pre-requisites (FA4, MA2, AU1, TX1, and FN1), Accounting Theory 1 (AT1) is now required prior to enrolling in PA1 or PA2. Students can get more information from the 2006-07 student handbook and from www.cga-online.org/canada.
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Congress to Discuss Accounting Issues
The 2006 World Congress of Accountants, being held in Istanbul from November 13-16, will bring together some of the profession's most prominent leaders to discuss the future of accountancy. Organized by the International Federation of Accountants (IFAC), the congress is expected to attract more than 5,000 accountants from all parts of the world.
Following the theme Generating Economic Growth and Stability Worldwide, the conference includes plenary sessions on broad topics such as capital market stability, generating economic growth in developing nations, and value creation through professional accountants in business. There are 34 workshops on subjects ranging from corporate social responsibility to enterprise risk management to support for SMPs and improving the effectiveness of boards. Attendance at all sessions qualifies for 16 professional development hours.
Sylvie Voghel, FCGA, in her role as a member of the Board of IFAC, will chair a workshop on accounting standards for small and medium-sized entities. Pierre Barnès, FCGA, will be part of the panel in that workshop. CGA-Canada will have a visible presence at the conference as a bronze-level sponsor. See www.wcoa2006istanbul.org.tr for more information.
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Ariganello Addresses ICAC Conference
The Institute of Chartered Accountants of the Caribbean (ICAC) held its 24th Caribbean Conference of Accountants in Barbados in June, featuring a presentation by
CGA-Canada President and CEO Anthony Ariganello, CPA (Delaware), FCGA.
Ariganello was part of a panel on practice monitoring that included Graham Ward, President of the International Federation of Accountants; Allen Blewitt, CEO of the Association of Chartered Certified Accountants; Garth Kiddoe, President of ICAC; and Michael Edghill, President of the Institute of Chartered Accountants of Barbados.
"CGA-Canada's Code of Ethical Principles and Rules of Conduct embodies five key elements: continuing professional development, standards of practice, quality assurance, practice regulation, and professional liability insurance. Although no one element by itself ensures quality, the combination of all five provides a reasonable level of public protection," Ariganello told the conference.
The Prime Minister of Barbados, Owen Arthur, was among the other speakers at the two-day event. CGA-Canada is an affiliate of ICAC.
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CGA Program Introduced in Jamaica
The CGA Program of Professional Studies will be introduced in Jamaica in October following recognition of CGA-Canada as a qualifying accounting body by the Institute of Chartered Accountants of Jamaica (ICAJ) earlier this year.
With Jamaica's formal recognition, CGA-Canada is now recognized by all member countries of the Institute of Chartered Accountants of the Caribbean (ICAC), of which CGA-Canada is an affiliate. The recognition is consistent with ICAC's goal of harmonizing standards throughout the region and should lead to greater labour mobility for Caribbean CGAs. Administration of the CGA program in Jamaica will be through the CGA Barbados office, with local support from the ICAJ Secretariat.
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Annual Report Now Online
CGA-Canada's 2005-06 annual report and audited financial statements are now available on the web. The annual report highlights the Association's accomplishments over the past year. To download your copy, go to www.cga-online.org/canada.
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AcSOC Considers CGA Research
CGA-Canada stressed the need to address the underlying causes of Canada's pension funding crisis in a presentation to the Accounting Standards Oversight Council (AcSOC) at its May meeting.
Rock Lefebvre, CGA-Canada's vice-president of Research and Standards, and Amar Goomar, senior standards analyst, explained the serious funding deficits facing many of Canada's defined benefit pension plans, as well as the complexity of pension accounting and funding rules. Lefebvre pointed out that the question of ownership of pension plan surpluses must be settled as it provides a disincentive for companies to address a funding shortfall. The presentation was based on the findings of The State of Defined Benefit Pension Plans in Canada: An Update, a CGA-Canada research report released in November 2005. The report can be read at www.cga-online.org/canada under Advocacy and Research.
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Correction:
In the July/August issue, an error appeared in the diagram under Pace Career Electives. Course AU1 should have read AU2. We regret the inaccuracy.