ISAR Newsletter December 2015

ISAR Update

UNCTAD/WEB/DIAE/ED/2015/5
This document has been reproduced without formal editing.
December 2015

 


In this issue:

 

 

Thirty-third session of UNCTAD-ISAR to be held 4-6 October 2016 in Geneva

The 33rd session of the Intergovernmental Working Group of Experts on International Standards of Accounting and Reporting (ISAR) will be held from 4-6 October 2016 at the Palais des Nations in Geneva.  More detailed information on technical workshops and training sessions that will take place during the week of 3-7 October 2016 will be communicated in due course.

 
UNCTAD-ISAR holds its 32nd session of ISAR and highlights the role of accounting and reporting in the 2030 Sustainable Development Agenda

In his opening remarks at the 32nd session of ISAR, Mukhisa Kituyi, Secretary-General of UNCTAD stated that “High-quality corporate reporting is essential for the efficient allocation and management of scarce resources. It contributes to financial stability, promotes corporate good governance and underpins a vibrant private sector. It is critical for realizing the ambitions of agenda 2030”.  The participating delegates welcomed the adoption of the 2030 Agenda for Sustainable Development and the commitment of the international community to achieving sustainable development in its three dimensions – economic, social and environmental – in a balanced and integrated manner. They highlighted the essential role that the private sector could play in achieving the Sustainable Development Goals (SDGs) and underscored the importance of high-quality financial and non-financial reporting for better transparency, accountability and good governance. They emphasized that high-quality reporting could also serve as an important part of the monitoring and review mechanism for SDGs by member States and as a means of assessing the impact of companies on sustainable development.
During the three-day meeting, the Group of Experts addressed the critical role that auditing and assurance standards play in facilitating capital formation by fostering investor confidence that can lead to the mobilization of domestic and international resources. Delegates highlighted challenges pertaining to effective implementation of International Standards on Auditing, such as assurance of non-financial reporting, audit of small and medium-sized enterprises and financial reports prepared by public sector entities. In the course of its deliberations on this topic, the Group of Experts indicated a need for closer collaboration among standard-setters, various sectoral regulators and oversight authorities to gain synergies and achieve effective regulation.  Russell G. Golden, Chair of the Financial Accounting Standards Board, gave a keynote address on broadened the focus beyond individual companies to capital markets and other financial market players, saying: “Accounting standards are an important element – but not the only element – required to promote high-quality financial reporting. We need honest companies, we need honest auditors – and we need watchful regulators—to make the system work. The standards themselves can only go so far. Every participant in the capital markets has a role“. The Group reviewed feedback on UNCTAD’s Accounting Development Tool (ADT) from the experience of Kazakhstan and Ukraine. The meeting also provided updates from international, regional and national bodies on their activities in the area of accounting and reporting.
ISAR concluded the session by reaching agreed conclusions on the two main agenda items it discussed. Delegates agreed on the critical role that the consistent implementation and enforcement of international auditing and assurance standards play in ensuring high quality corporate reporting.  The session also called on ISAR to conduct further work to identify good corporate reporting practices on the SDGs and facilitation of harmonization of sustainability reporting.
A full report on the thirty-second session of ISAR will be posted on the ISAR website in due course, the background documentation, presentations and a photo gallery of the session can be accessed by clicking here.


UNCTAD hosts workshop on International Public Sector Accounting Standards

UNCTAD held a workshop on the practical implementation and challenges of International Public Sector Accounting Standards on 3 November in Geneva. The workshop highlighted that high-quality financial and non-financial reporting is essential not only for the private sector but also for the public sector.  IPSAS can play a very important role as a tool to strengthen the robustness of the public sector reporting, increase its comparability and consistency. However, successful implementation of IPSAS requires taking a comprehensive and integrated approach to institutional and technical capacity-building in the area of public sector financial management, including technical knowledge on IPSAS.The workshop was opened by a key note speech from Ian Ball, Chair of the Chartered Institute of Public Finance and Accountancy, and was followed by a number of distinguished experts in the area of reporting. The morning session reviewed the current status of IPSAS standard-setting and its governance system; while the afternoon session elaborated on specific technical issues of IPSAS implementation, good practices and lessons learned

To access the workshop presentations – please click here.


UNCTAD and GRI organize introductory workshop on sustainability

UNCTAD and the Global Reporting Initiative (GRI) organized a joint introductory workshop on sustainability reporting, on 2 November in Geneva.  The workshop focused on GRI’s Sustainability Reporting Framework and G4 Reporting Guidelines, which aims to provide governments and regulatory bodies with an overview of how sustainability reports contribute to transparency and accountability and how organisations preparing them are responding to increasing regulatory requirements.Background materials related to the training and sustainable reporting can be found here.

UNCTAD XIV and World Investment Forum to be held in Nairobi in July 2016

There has been a change to the date and location of the Fourteenth Quadrennial Ministerial conference of UNCTAD.  UNCTAD XIV will now take place in Nairobi, Kenya, from 17 to 22 July 2016, and will bring together Heads of State and Government, ministers and other prominent players from the business world, civil society and academia to tackle global trade and economic development issues. The quadrennial Conference will also be a unique opportunity to consider the most appropriate means of delivering on the post-2015 development agenda. The World Investment Forum 2016 will also take place in Nairobi in parallel with the UNCTAD XIV conference.  It will continue to serve as the global forum for inclusive dialogue and policy formulation on investment-development needs at the highest level, bringing together investment partners to discuss challenges, opportunities and policy solution to meet the SDGs.


Joining the ISAR Network

UNCTAD-ISAR is keen to maintain and extend its outreach to government officials, professional bodies, international organisations, private sector and other experts involved in the area of accounting and reporting. To this end, UNCTAD relies on you to keep us abreast of any updates to your contact information and to forward the following to other experts who may be interested in joining the ISAR network:
If you are not already part of the ISAR network and would like to join for updates on ISAR’s meetings, events and activities please complete this on-line ISAR Network form.

 

News briefs:


IFIAR approves new governance structure

On September 15th, IFIAR members approved a new governance structure that will “further professionalize the organization,” according to the Chair, Janine van Diggelen. This change, which is necessary due to increased membership since 2006, will enhance IFIAR’s “substantive audit regulation issues and developments” improve “overall organizational value” and provide “more efficient and timely contributions to international audit quality matters.” Further information on this change can be accessed by clicking here.

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IASB seeks investor and analyst views on future work plan

The IASB are seeking investor and analyst views on the IASB’s work plan. This survey requests views on both the broader scope of their work and respondents’ prioritization of individual topics for their future work plan. This anonymous survey is approximately 15 minutes in length and should be submitted by the 15th of December. Further information on this survey can be accessed by clicking here.
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IASB publishes draft Practice Statement providing guidance for managers on materiality

On October 28th, the IASB published its draft guidance to help management apply the concept of materiality. This draft Practice Statement strives to provide better guidance for managers on the application of materiality by using the Standards as a checklist. The draft guidance accompanies the 2014 amendment to IAS 1 Presentation of Financial Statements. The IASB welcomes comments on the draft Practice Statement which should be submitted before the 16th of February, 2016. Further information on this publication can be accessed by clicking here.

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GRI launches UN Sustainable Development Goal Target 12.6 – Live Tracker & initiates changes in governance structure creating the Global Sustainability Standards Board (GSSB)

As of September 25th, GRI upgraded their Sustainability Disclosure Database with the UN Sustainable Development Goal Target 12.6 – Live Tracker. The Target 12.6 Live Tracker assists governments in encouraging companies to report on their sustainability by revealing to corporate stakeholders how sustainability reporting is progressing around the world. Further information on this upgrade can be accessed by clicking here.
Changes to GRI’s governance structure initiated in January 2015 led to the creation of the Global Sustainability Standards Board (GSSB). The GSSB, consisting of 15 members and chaired by Eric Hespenheide, held their inaugural public meeting on November 4th. The purpose of this board will be to approve GRI Sustainability Reporting Standards (GRI Standards). Further information on this change can be accessed by clicking here.

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GRI launches new Linkage Document connecting G4 and UN guidelines

At the Fourth United Nations Forum on Business and Human Rights held on November 16th, GRI launched its new Linkage Document, Linking G4 and the UN Guiding Principles. This Linkage Document connects the GRI G4 Reporting Guidelines (G4) and the United Nations Guiding Principles on Business and Human Rights. The key connecting features highlighted are due diligence, grievance mechanisms and impact assessments. Further information on this document can be accessed by clicking here.

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IFAC releases two Exposure Drafts for comment & publishes new thought paper on integrated reporting

On October 14th, IFAC’s International Public Sector Accounting Standards Board (IPSASB) released two Exposure Drafts (ED) for comment. ED 57, Impairment of Revalued Assets, includes property, plant and equipment, and intangible assets within the scope of IPSAS 21 and IPSAS 26. ED 58, Improvements to IPSASs 2015, provides minor changes and adjustments to IPSASs 2015 in order to improve consistency and convergence. Further information on these drafts can be accessed by clicking here.

On November 3rd, IFAC released its new thought paper setting out a vision for integrated thinking, Creating Value with Integrated Thinking: The Role of professional Accountants. This thought paper provides practical terms to help private and public sectors facilitate their organization. It provides five key elements for effective organizations that can assist in the transition from financially oriented reporting to integrated reporting. Further information on this publication can be accessed by clicking here.

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IFAC issues Russian translation of IAASB handbook

On November 19th, IFAC published the Russian translation of the International Auditing and Assurance Standard Board Handbook of International Quality Control, Auditing, Review, Other Assurance, and Related Services Pronouncements, Volume I. This translation was provided by the National Organization for Financial Accounting and Reporting Standards Foundation and reviewed by an expert committee from the Russian Federation, Belorussia, Kazakhstan and Kyrgyzstan. Further information on this publication can be accessed by clicking here.

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IPSASB announced the establishment of a new IPSASB Consultative Advisory Group (CAG)

The International Public Sector Accounting Standards Board (IPSASB) announced the establishment of a new forum — the IPSASB Consultative Advisory Group (CAG) — that will have representatives of public and private sector organizations and individuals who are interested in or affected by the IPSASB’s work, including those engaged in the preparation, audit or evaluation of public sector financial reports.

The CAG will provide advice to the IPSASB on:

  • The IPSASB’s strategy and work plan;
  • IPSASB’s projects, including views on technical issues or matters that may impede adopting and implementation of International Public Sector Accounting Standards (IPSAS); and
  • Oher matters relevant to the IPSASB standard-setting activities.

The inaugural meeting of the CAG is provisionally planned for June 2016 in Toronto, Canada.
More details can be found by clicking here:

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The Sustainability and Reporting 2025 Forum explored what the next 10 years of sustainability and reporting might look like

In October 2015, as part of the Sustainability and Reporting 2025 Project, GRI convened business executives and thought leaders from various fields at a trends forum in Rome to explore what the next 10 years of sustainability and reporting might look like.

The Sustainability and Reporting 2025 Forum shared the insights of more than 20 interviews with business leaders and thought leaders, and two analysis papers. The forum brought together 60 invitees, both high level representatives from large companies and experts, to debate the project findings and collectively build a 2025 agenda.

Looking ahead to the sustainability and reporting trends in 2025, GRI’s Sustainability and Reporting 2025 project aims to facilitate the discussion around the future of reporting. GRI issued two analysis papers that examine the key decisions businesses will focus on in the next decade in order to transition to a sustainable economy, and how disclosure and reporting should be shaped to support decision makers in this process.

Download the First Analysis Paper by clicking here and the Second Analysis Paper can be found here.

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OECD-CDSB report on “Climate change disclosure in G20 countries: Stocktaking of corporate reporting schemes” analyses mandatory reporting schemes in G20 countries

The majority of G20 countries (15) have some kind of mandatory corporate reporting scheme in place that requires disclosure of climate change related information, such as greenhouse gas emissions, policies to reduce emissions, exposure to climate risks, etc. There are some commonalities between schemes, for example, they all require reporting of direct GHG emissions and some require reporting of emissions linked to energy consumption. However, there are also significant differences on the quality and content of reported information, e.g., on the way emissions are calculated, on verification requirements and reporting platforms. This multiplicity of requirements poses challenges to reporting companies and users of the information, including, investors and other stakeholders.
The report has been prepared in co-operation between the OECD and the Climate Disclosure Standards Board. The research underlying the report was undertaken as part of the project Aligning Policies for the Transition to a Low-carbon Economy, conducted jointly by the OECD, the International Energy Agency, the International Transport Forum and the Nuclear Energy Agency.
To download the report please click here and more details can be found here.

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OECD issues Guidelines on Corporate Governance of State-Owned Enterprises, 2015 Edition

The new OECD Guidelines on Corporate Governance of State-Owned Enterprises provide an internationally agreed benchmark to help governments assess and improve the way they exercise ownership functions in state-owned enterprises (SOEs).
To download the report click here.

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CIPFA Developed Fraud Assessment Tool

CIPFA has developed an interactive Assessment Tool, designed to help public sector organizations measure their counter-fraud arrangements against the Code of Practice on Managing the Risk of Fraud and Corruption.
The Code of Practice sets out the five key principles that define the governance and operational arrangements necessary for an effective counter fraud response. The Tool allows to benchmark organizations against each other, giving an invaluable insight into the experience of the peers.
For more details, please click here.

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New UNEP Report requires a re-alignment of the financial system with the goals of sustainable development

A report from the United Nations Environmental Programme (UNEP) titled, ‘The Financial System We Need’ argues that there is now a historic opportunity to shape a financial system that can more effectively finance the development of an inclusive economy. The report states that to achieve sustainable development “will require a re-alignment of the financial system with the goals of sustainable development.”
UNEP set up an inquiry into the design of a sustainable financial system to advance policy options to deliver a step change in the financial system’s effectiveness in mobilizing capital towards a green and inclusive economy. The report cites a major challenge being to ‘develop greater coherence amongst reporting codes, a need to reflect in the Corporate Reporting Dialogue’.

To download the report: http://www.arpacal.it/allegati/UNEP_report.pdf

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