Adoption of the recommendations of the Review Group on Auditing would put the Republic in the forefront of effective professional governance, according to accountancy body ACCA Ireland.
Welcoming the recommendations, particularly those on regulatory and disciplinary matters, ACCA Ireland described them as a major step forward. "At last there is a willingness to tackle serious issues and create an appropriate platform for effective professional governance. Previous failures in regulation can now be overcome and a coherent - and efficient - system introduced. Proper professional governance is no longer a possible option, it is a requirement," according to the head of ACCA Ireland, Mr Roger Acton. ACCA has accepted the need for major changes in the way the profession is regulated.
"It is easy to understand why the group's approach has been so resolute. The background against which it has reached its conclusions would encourage most of us to err on the side of regulation," it said.
Mr David Leonard, a past president of the worldwide ACCA body and ACCA Ireland's representative on the Review Group, said his group had already called for open regulatory and disciplinary processes in the sector. The recommendations on disciplinary and regulatory procedures are "closely aligned" with those already in operation at ACCA, he said. Its disciplinary hearings are open to the public and are chaired by an independent non-member.
ACCA has backed the proposed new supervisory board to oversee the current delegated self-regulation of accountants by their professional bodies. It described the Oversight Board as "a serious attempt to deal with previous failures in regulation", which retains the culture of self-regulation while providing a framework to ensure that abuse is tackled.
ACCA wants the board to be "truly independent and comprised of individuals of reputation, integrity and broad-based professional and commercial experience".
But the body has expressed concern about the appropriateness of applying some of the recommendations to small businesses as well as to larger companies and about how unqualified accountants will be regulated. For smaller companies "a lighter touch" would be better, according to Mr Leonard. For example, he said, annual directors' letters reporting company compliance with obligations under company law, tax law and other statutory requirements could be a very onerous requirement on a small company.
