Corporate Reporting to Stakeholders

Why CFOs Should Care about Integrated Reporting

2012-01-27T15:06:00.000-05:00

On November 15, 2011, the AICPA organized a roundtable discussion in California on behalf of the International Integrated Reporting Council (IIRC). Major investors, companies and other stakeholders had the opportunity to discuss the business case for integrated reporting, as well as the challenges in communicating the benefits. Why should CFOs care about integrated reporting? Because it’s about: 1. Communicating vs. Complying; 2. Reporting the Intangibles; 3. Breaking Down Silos; and 4. Increasing Transparency.

To learn more, refer to the article “4 Reasons CFOs Should Care about Integrated Reporting” at AICPA Insights online.

AICPA Encourages IIRC to Leverage Enhanced Business Reporting Framework

2012-01-17T15:20:00.000-05:00

In a December 14, 2011 comment letter to the International Integrated Reporting Council on its discussion paper, Towards Integrated Reporting: Communicating Value in the 21st Century, the American Institute of Certified Public Accountants (AICPA) supported an international framework for integrated reporting and encouraged the IIRC to leverage the preliminary, high level Enhanced Business Reporting Framework.

The letter states that: “We agree that there is a need for a new reporting model that brings together the currently disparate pieces and perspectives of business reporting to produce a more holistic external presentation of decision-useful information for investors and other stakeholders.” It suggests that the framework should allow organizations to find and report common framework elements most relevant to their stakeholders and that the elements should be presented so that they are comparable across companies and time periods. In order to improve transparency and provide easy access to, and analysis of, integrated reporting disclosures, the framework should allow the creation of standardized integrated reports using data standards such as eXtensible Business Reporting Language (XBRL).

According to the AICPA, the initial focus of integrated reporting should be on larger companies and the needs of their investors, which would serve as an important core foundation that can be leveraged over time to meet the needs of all companies and audiences. For more information, read the AICPA Insight blog and visit the Enhanced Business Reporting section on AICPA.org.

Canada’s Corporate Reporting Awards program celebrates 60 years of excellence

2012-01-11T14:31:00.002-05:00

For 60 years, the CRA has been Canada’s only national program shining a spotlight on Canada’s best corporate reporting models. The program offers publicly-listed companies, and now federal and provincial Crown corporations, a unique opportunity to showcase their commitment to quality corporate reporting. Entrants demonstrate confidence in their reports by submitting them to an independent panel of judges, who are experts in their respective areas.

Fifteen Canadian publicly-listed companies and Crown corporations were recently honoured in Toronto at a gala event that marked the diamond anniversary of the Chartered Accountants of Canada’s Corporate Reporting Awards (CRA).

When the program started in 1941, the focus was the annual financial report. Over the years, it has evolved to keep pace with the capital markets and the expectations of Canadian investors for greater transparency and better information on which to base their investment decisions. Today’s CRA includes separate categories for corporate governance reporting, sustainable development reporting and electronic disclosure. The criteria have helped drive the development of best practices in all these areas, which are now regarded as essential components of the integrated corporate reporting model.

PCAOB Concept Release on Auditor Independence and Audit Firm Rotation

2011-11-30T09:01:00.010-05:00

On August 16, 2011, the US Public Company Accounting Oversight Board (PCAOB) issued a concept release to solicit public comment on ways that auditor independence, objectivity and professional skepticism could be enhanced.

One possible approach on which the Board is seeking comment is mandatory audit firm rotation, which is explored in detail in PCAOB Release No. 2011-006. However, the Board seeks advice and comment on other approaches as well. Comments should be submitted no later than December 14, 2011. The Board will also convene a public roundtable meeting in March 2012, at which interested persons will present their views. Additional details about the roundtable will be announced at a later date.

Sustainability: Environmental and Social Issues Briefing

2011-11-29T10:33:00.003-05:00

Environmental and social issues are increasingly having an impact on the bottom line and future prospects of companies in many industries. They can present both opportunities and risks. In addition, they can have important implications for strategy, competitiveness, risk management, stakeholder relations and business resilience. A company’s board of directors has key oversight responsibilities in relation to environmental and social issues.

Board awareness and attention are essential in keeping abreast of the fast-evolving business impacts of these issues. Sustainability: Environmental and Social Issues Briefing highlights the environmental and social issues directors need to consider, providing an understanding of the potential business implications of these issues and offers questions that directors might ask in discharging their oversight responsibilities.

Global Companies to Lead Unique Integrated Reporting Pilot Program

2011-11-23T14:25:00.000-05:00

The International Integrated Reporting Committee (IIRC) has announced that over 40 leading companies from around the world have been chosen as participants in the IIRC Pilot Programme initiative and the number is growing. These global companies, representing various sectors and industries, met for a two day kick-off event in Rotterdam on October 17-18, 2011. This marked the beginning of a two year journey with the IIRC where they will be given the opportunity to demonstrate global leadership in this emerging approach to corporate reporting. The full list of participating companies is available on the IIRC website.

Academic Study Shows Investor Acceptance of XBRL Technology

2011-11-22T16:43:00.000-05:00

A group of academics studying XBRL acceptance have determined that investors are warming up to using XBRL-enabled technology to do their research and make investment decisions. In their study of the effects of exclusive technology choice on the analysis of financial information, a trio of accounting professors found that 66% of non-professional investors chose XBRL-enabled technology to complete a financial analysis task because they perceived it would reduce the time it would take for them to complete the task.

The 34% of nonprofessional investors who chose spreadsheets over XBRL-enabled technology said they preferred it because of prior experience they had using that technology. No one in the study chose document exchange software, such as PDFs, to complete the task. These findings have implications for the technology choice literature, regulators mandating or considering mandating XBRL-based reporting, and XBRL-enabled technology adoption.

To learn more, read the June 2011 SSRN research article, XBRL-Enabled, Excel or PDF? The Effects of Exclusive Technology Choice on the Analysis of Financial Information, by Diane Janvrin of Iowa State University, Robert Pinsker of Florida Atlantic University, and Maureen Francis Mascha of University of Wisconsin-Oshkosh.

XBRL stands for eXtensible Business Reporting Language. It is one of a family of "XML" languages which is becoming a standard means of communicating information between businesses and on the Internet. XBRL is a language for the electronic communication of business and financial data which is revolutionizing business reporting around the world. It provides major benefits in the preparation, analysis and communication of business information. It offers cost savings, greater efficiency and improved accuracy and reliability to all those involved in supplying or using financial data.

XBRL is being developed by an international non-profit consortium of over 600 major companies, organizations and government agencies. It is an open standard, free of licence fees. It is already being put to practical use in a number of countries and implementations of XBRL are growing rapidly around the world. The idea behind XBRL is simple. Instead of treating financial information as a block of text - as in a standard Internet page or a printed document - it provides an identifying tag for each individual item of data. This is computer readable. For example, company net profit has its own unique tag. The introduction of XBRL tags enables automated processing of business information by computer software, cutting out laborious and costly processes of manual re-entry and comparison. Computers can treat XBRL data "intelligently": they can recognize the information in a XBRL document, select it, analyse it, store it, exchange it with other computers and present it automatically in a variety of ways for users. XBRL greatly increases the speed of handling of financial data, reduces the chance of error and permits automatic checking of information.

The XBRL International website provides further information about the nature, uses and benefits of XBRL. It explains how individuals and companies can join the effort to move forward and make use of the language.

KPMG International Survey of Corporate Responsibility Reporting 2011

2011-11-21T17:18:00.000-05:00

According to a recent KPMG survey, leading companies have combined their Corporate Social Responsibility (CSR) reporting and financial reporting, often by merging the two into the annual report. While this has been a valuable stepping stone in building an understanding of how CSR impacts the business, greater value will be gained once both sets of information are treated as part of the company’s comprehensive business performance reporting, both to internal management and external stakeholders.

Companies are also quickly evolving the method by which they communicate their CSR information to their various audiences. As more and more companies start to employ multiple vehicles for communication, the focus will be on developing and implementing a comprehensive communication strategy that enhances trust and value for the company within its different stakeholder groups.

(For more information, read the full report, KPMG International Survey of Corporate Responsibility Reporting 2011, available online.)

CICA seminar on integrated reporting features Robert Herz

2011-11-20T13:12:00.000-05:00

Robert Herz, the recently retired chair of the US Financial Accounting Standards Board (FASB), will be in Toronto, Canada on November 23, 2011, for a breakfast seminar.

At the seminar, organized by the Canadian Institute of Chartered Accountants (CICA), Mr. Herz will review the proposals outlined in a Discussion Paper, Towards Integrated Reporting – Communicating Value in the 21st Century. The Paper was published on September 12, 2011, by the International Integrated Reporting Committee (IIRC) with a call for comments by December 14, 2011.

The IIRC was established in August 2010 by the Prince of Wales Accounting for Sustainability Project, the Global Reporting Initiative, and the International Federation of Accountants. The IIRC brings together a cross section of representatives from the corporate, investor, accounting, securities, regulatory and standard-setting communities.

The Discussion Paper features proposals for the development of an International Integrated Reporting Framework and outlines the next steps toward its creation and adoption. The goal of integrated reporting is to provide more comprehensive and meaningful information about how an organization creates and sustains value.

(For more information, see the CICA media release on November 18, 2011.)

Corporate reporting - From compliance to competitive edge

2011-11-02T08:50:00.018-04:00

Today’s business information and reporting is under fire from companies, investors, government and regulators alike. In response, PricewaterhouseCoopers (PwC) has published a paper called "Corporate reporting - From Compliance to Competitive Edge" which explains why today's business information and reporting is falling short, what's driving change, where insight is missing and how companies can take action. This report incorporates some of the findings from the PwC annual survey of the quality of FTSE 350 reporting.

(For more information on recent developments, visit the PwC corporate reporting website and also see the PwC Corporate Reporting Blog by David Phillips, Senior Corporate Reporting Partner in the Assurance practice of PricewaterhouseCoopers LLP.)

Announcing the Investis Online IR Rankings

2011-10-31T09:35:00.005-04:00

Investis Online IR Rankings, a unique free feature, aims to help investor relations professionals identify companies that are international leaders in online IR communications. The initial rankings cover major international stock exchanges, including the S&P 100 index of the largest US companies, the FTSE 100 of the largest UK-listed companies, the DAX index of blue chip German companies, the Italian FTSE MIB index, and Finland’s OMXH 25. New indexes will be added in future quarterly updates to eventually cover about 800 companies, which will be reviewed twice per year.

The evaluations are conducted by Investis, a leading corporate website service provider based in London, and validated through random sampling by IR Web Report. Investis has been evaluating corporate websites for its IQ Benchmarking service since 2008. The Online IR Rankings are an offshoot of its corporate website rankings and use an IR-focused scoring system devised by IR Web Report. For more information, see the October 25, 2011 posting “Introducing the Investis Online IR Rankings” by Dominic Jones at IR Web Report online.

Highlights of Corporate Governance Research

2011-10-27T09:43:00.003-04:00

Several corporate governance developments have occurred in the wake of the high-profile scandals of the past decade. Some of these developments are motivated by legislation, such as the Sarbanes-Oxley Act of 2002 (SOX). Others are best practices enhancements intended to shore up investor confidence. Academic research has monitored these developments. The article “Highlights of Corporate Governance Research” in the September 2011 issue of the Journal of Accountancy summarizes important academic findings and observations recently published in prominent accounting and finance journals.

This article is part of a series that samples accounting research and distills key findings for busy practitioners and preparers. These summaries explain the implications of a wide range of research and give CPAs the opportunity to apply the results in day-to-day activities. Readers interested in more detail should review the full text of each article to explore the hypothesis, research process, statistical analysis, supporting theories and conclusions.

What makes a good annual report?

2011-10-25T11:48:00.000-04:00

What’s the secret for a good annual report? It usually boils down to keeping things simple, but keeping them simple these days is a challenge. Rising demands for more disclosure and the integration of sustainability reporting are factors making annual reports ever longer and more complex. Unfortunately, too many annual reports are choked with low-quality information, disconnected content and boilerplate, all of which obscures key messages.

Clear, crisp communication, on the other hand, is a sign of strong leadership. It’s also an opportunity to improve engagement and dialogue with stakeholders. Four techniques for creating a good annual report are: (1) focus on strategy; (2) cut the clutter; (3) sum it up; and (4) speak plainly.

(To learn more, read “What makes a good annual report?” by Richard Ketchen at IR Web Report online.)

Canadian Standards in Transition - ASPE Resources Available

2011-10-18T21:37:00.000-04:00

The Canadian Institute of Chartered Accountants (CICA) has recently issued three new resources to help private companies make a smooth transition to the new accounting standards for private enterprises (ASPE).

A Guide to Understanding Transitional Options and Accounting Policy Choices
This guide helps practitioners understand the choices and decisions available under the new accounting standards for private enterprises (ASPE) and provides practical examples and worksheets.

A Case Study: Financial Statement Comparison
This publication presents an example of non-consolidated and consolidated financial statements prepared in accordance with pre-changeover accounting standards - XFI Version, and financial statements restated in accordance with ASPE.

Transition Considerations for a Non-Complex Entity
This summary highlights significant changes in the new standards as well as items that require management consideration. The information, geared to non-complex entities, raises awareness for typical balances on a set of financial statements.

PwC’s “To the point: Current issues for boards of directors – Fall 2011”

2011-10-14T09:09:00.002-04:00

As the title suggests, “To the point” addresses contemporary issues and is meant to be impactful, insightful and concise. Each quarter, PwC addresses select topics that are of immediate interest to directors. The Fall 2011 edition shares insights on several matters.

Next year's proxy season: The SEC's plan for proxy access was struck down by a US Court of Appeals decision in July, but directors should prepare for the possibility of private ordering proxy access.

A new discussion about mandatory auditor rotation: The idea of mandatory audit firm rotation has resurfaced in a recent PCAOB concept release, and comments are requested on the matter.

Technology in the boardroom: Directors are increasingly using electronic portals and tablet devices to access board materials and books, and the trend is likely to continue.

(Read PwC’s To the point: Current issues for boards of directors – Fall 2011.)

Amsterdam Roundtable on Integrated Reporting

2011-10-13T10:47:00.000-04:00

An Executive Roundtable on Integrated Reporting was recently organized by the International Integrated Reporting Committee (IIRC) and Duisenberg School of Finance in Amsterdam. It was one of a series of roundtables hosted around the world to encourage the exchange of views on Integrated Reporting among leaders in business, investment, civil society, accounting and the standard setting community. The focus was on the Integrated Reporting Discussion Paper, Towards Integrated Reporting – Communicating Value in the 21st Century, which was launched on September 12, 2011.

It was noted that Integrated Reporting is about accountability regarding past financial and non-financial performance and providing insight in how a company aims to create and sustain value for shareholders and other stakeholders. Integrated Reporting only makes sense if it is part of an integrated business strategy. It should not be a data collection exercise, just for the sake of reporting. In addition, legislation has a role to play in creating a level playing field for Integrated Reporting. It should avoid being compliance based and rather be designed along the lines of a “comply or explain” approach. A Summary of the Roundtable Discussion is available online.

Communication Technologies put Privacy at Risk

2011-10-06T09:16:00.021-04:00

According to a recent survey, Canadians are heavy users of social networks and other communications technologies, but many are not taking basic steps to protect their personal information. A telephone survey of 2,000 randomly selected adults, commissioned by the Office of the Privacy Commissioner of Canada (OPC), found that three-quarters (74%) of respondents own at least one mobile communications device, such as a cell phone, smart phone or tablet. However, only 4 in 10 use password locks for the devices, or adjust their settings to limit the sharing of personal information that may be stored on the devices.

The Canadians and Privacy Survey 2011 found that one-third of Canadians use public Wi-Fi sites, such as those located at coffee shops and airports, where online communication may not always be protected by encryption. Of those, fully 85% admitted to some concern about possible risks to the security of their personal information.

The poll, conducted by Harris/Decima, also found that just over half (51%) of respondents use social networking sites, such as Facebook, MySpace and LinkedIn. Fortunately, 4 in 5 said they take advantage of privacy settings that allow them to control access to their online content. Even so, 45% of all respondents who use social networking sites acknowledged that they are concerned about the associated risks to their privacy.

Global Anti-bribery and Corruption Survey 2011

2011-10-04T09:03:00.025-04:00

In Canada, managing bribery and corruption risks has not assumed the importance and urgency seen in other jurisdictions. To date, Canada’s Corruption of Foreign Public Officials Act (CFPOA), has received little attention from corporations and enforcement by officials. This is in stark contrast to the situation in the United States where the Foreign Corrupt Practice Act (FCPA) is robustly and strictly enforced.

However, there have been important developments on the Canadian anti-bribery and corruption (AB&C) front. The new reality for Canadian companies is one of increased AB&C enforcement activity, both at home and abroad.

KPMG Forensic commissioned a survey of 214 executives (106 in the US and 108 in the UK) who consider themselves “one of the most senior persons in charge of day-to-day AB&C matters at their company.” The three most significant AB&C compliance challenges cited by both US and UK respondents are auditing third parties for compliance, difficulty in performing effective due diligence on foreign agents/third parties, and variations in country requirements and local laws on issues, such as data privacy and facilitating payments. (Read the Global Anti-bribery and Corruption Survey 2011.)

Integrated Reporting: Performance insight through Better Business Reporting

2011-09-29T09:05:00.005-04:00

KPMG has issued the first edition of the publication Integrated Reporting: Performance insight through Better Business Reporting. It focuses on the challenge of providing better corporate reporting. Many who read this may not be familiar with the topic but, with the publication by the International Integrated Reporting Committee (IIRC) of its Discussion Paper, it is likely to receive more attention in the future. In the past, KPMG has looked at this as “Better Business Reporting” which captures the essence of the subject.

The first edition provides some background on Integrated Reporting with a series of short articles by some of the firms’ specialists. After a brief summary that explains what Integrated Reporting is, Michael Bray sets out the case as to why senior executives and non-executives ought to be interested.

XBRL International Conference – October 2011

2011-09-27T09:08:00.000-04:00

XBRL (eXtensible Business Reporting Language) is transforming business reporting. Does your company seek recognition as a thought leader on XBRL? If you have business interests or plans for business development, do not miss this opportunity to take the stage! The 23rd XBRL International Conference: "XBRL23: Enhancing Business Performance" is produced by XBRL International, Inc. and hosted by XBRL Canada. The Conference will be held on October 25-27, 2011 at Le Centre Sheraton, Montreal, Canada.

XBRL is an XML-based, royalty-free, open standard for business reporting. XBRL was developed by XBRL International, a not-for-profit consortium of leading companies and organisations around the world. For more information about the XBRL standard, visit the XBRL International website. XBRL Canada conducts seminars and webinars for companies and individuals wishing to learn more about XBRL. Currently, it is also working on projects to assist companies with convergence to IFRS.

Mobile insecurity

2011-09-22T09:30:00.006-04:00

The proliferation of mobile computing has brought on a number of challenges, specifically around security issues. Smartphones are repeating a pattern witnessed in the 1980s with desktop computers. They flood into the corporate fold without any rational plan. And very often, they are introduced by employees who can’t resist the status statement these devices make. The greatest obstacle to security is the users themselves. People believe nothing of value resides on their device, yet much can be used for identity theft, intellectual property theft or espionage. Everyone likes these devices for the immediacy and convenience, and don’t want to be bothered with security barriers, especially passwords. This is why many users deactivate the password protection, which to begin with is very rudimentary and requires only a four-digit PIN identification. In a regular notebook, that would never be accepted as security. To learn more, read the article “Mobile insecurity” in the September 2011 CAmagazine online.

The "cloud" and what it can do for your business

2011-09-20T09:07:00.022-04:00

When someone talks about joining “the cloud” are you puzzled? What is it, what does it do and what does it mean for the future? Some believe the cloud is a major step in the evolution of the Internet. Others say that, without a doubt, cloud computing will play a huge role in the design, reliability and speed of corporate websites. Many are convinced that, within the next five to six years, most computing services will be delivered from the cloud. Still, for many small business enterprises, cloud computing is an abstract concept. To learn more, read the article "Still foggy on cloud computing?" in the September 2011 issue of CAmagazine online.

The World is Changing – Reporting Must Too

2011-09-15T10:23:00.000-04:00

The Integrated Reporting Discussion Paper, Towards Integrated Reporting – Communicating Value in the 21st Century was launched on September 12, 2011. It is available for reading online and as a PDF document. The Paper considers the rationale for Integrated Reporting, offering initial proposals for the development of an International Integrated Reporting Framework and outlining the next steps towards its creation and adoption. Its purpose is to prompt input from all those with a stake in improved reporting, including producers and users of reports. The International Integrated Reporting Committee (IIRC) welcomes general comments on the Discussion Paper, as well as responses to the questions posed. The deadline for submission is December 14, 2011.

PwC – 10 Minutes on the CEO agenda

2011-09-13T09:27:00.005-04:00

PwC research has found that CEOs across the globe are redefining what growth looks like in a post-crisis world. Companies are reshaping their strategies and operating models—focusing on issues like talent, innovation and collaboration—to find new sources of revenue growth and competitive advantage. There are eight key questions leaders can ask— about where and how to change—to ready their businesses for the road ahead. Read the PwC March 2011 publication Growth reimagined: The eight questions every CEO should ask about getting—and staying—ahead.

Corporate Sustainability: A progress report

2011-09-08T11:57:00.001-04:00

Corporate Sustainability: A progress report is a KPMG research report, conducted in cooperation with the Economist Intelligence Unit. It reviews the importance of sustainability within business today and executive attitudes toward this issue. According to the report, sustainability is rapidly becoming a strategic priority for businesses.

Around the world, there are encouraging examples of pioneering companies that have recognized the imperative of sustainability and created strategies and solutions. For a growing number, the concept of sustainability goes far beyond corporate social responsibility (CSR). It has become the strategic lens through which they view their businesses. For these organizations, sustainability offers an undeniable opportunity to gain competitive advantage, drive innovation and generate real bottomline results. Despite a complex array of challenges, these companies are already taking great strides towards shaping the global approach to sustainability. What propels these organizations past their competitors is the recognition that sustainability goals must be tied to operational strategy and measured in the same way as other investments. By treating sustainability as an investment rather than a cost, they have adjusted their business models to drive long-term change and make them more competitive in the market.

This research report is based on an October 2010 global survey of 378 senior executives encompassing a range of industries and evenly split among North America (US and Canada), Asia Pacific and Europe, with a smaller representation from the Middle East, Africa and Latin America. Organizations of all sizes were represented: 40% of respondents worked for firms with revenues of at least US$ l billion, whereas 47% were from firms with revenues of US$ 500 million or less. The respondent base was very senior: 26% were CEOs, presidents or managing directors of their firms; half represented the C-suite or board; and all respondents were in a management position. To complement this and to provide specific context, the Economist Intelligence Unit conducted extensive desk research and in-depth interviews with numerous corporate sustainability executives and experts.

The Top Ten Tech Issues

2011-09-06T09:05:00.006-04:00

The Canadian Institute of Chartered Accountants (CICA) Information Technology Advisory Committee conducts an annual survey of the most important IT issues facing the profession, which provides interesting insight into the prevalence and impact that technology has on businesses. While some topics come up every year, the relative importance of several issues changes from survey to survey.

This year was no different. Information management rose to the top spot from No. 3, pushing last year’s No. 1 issue, legislation and regulatory compliance, to second place. The impact of the recession, No. 2 last year, fell to No. 10 in this year’s survey, while new and emerging technologies rose to No. 3 from No. 5. (To learn more, read the article "The Top Ten Tech Issues" in the September 2011 CAmagazine online.)

Usefulness of the Independent Auditor’s Report

2011-08-30T09:09:00.012-04:00

According to the CFA Institute, there is a growing worldwide debate on the usefulness of the independent auditor’s report. The current “pass/fail” model simply communicates that the financial statements are, in the auditor’s opinion, presented in accordance with generally accepted accounting principles, but there is no information available on how the auditor addressed the risks of material misstatements identified during the audit process. While it is clear that more information about the quality of the financial statements and the audit process might be useful, it is not clear what kind of information should be communicated through the auditor’s reporting model.

The CFA Institute sought feedback on this topic to assist in informing the audit standards-setting bodies as they consider how to modify the Independent Auditor’s Report to ensure that the user needs are being considered in any proposed changes. Survey results show that 58% think that the independent auditor’s report needs to provide more specific information about how the auditors reach their opinion. The most important additional information to include is: information about the independent auditor’s assessment of management’s critical accounting judgments and estimates (86% felt this was important to include); and, information about the independent auditor’s assessment of the quality, not just the acceptability, of management’s selection and application of accounting principles (90% felt this was important to include).

(For more information, read the March 2011 CFA survey report, Usefulness of the Independent Auditor’s Report, available online.)

Losing the excess baggage - reducing disclosures in financial statements to what's important

2011-08-25T09:03:00.008-04:00

The Institute of Chartered Accountants of Scotland (ICAS) and the New Zealand Institute of Chartered Accountants (NZICA) have undertaken a project for the International Accounting Standards Board (IASB). The joint project is to review International Financial Reporting Standards (IFRS) disclosure requirements, to remove much of the detailed information in financial statements so that they can focus on what is important.

Following the Group's detailed review of financial reporting standards, the paper recommends enhancing the use of materiality in financial reporting disclosures and deletion of many disclosure requirements that do not contain material information. It is expected that later this year the discussion paper and its recommendations will be issued by the IASB for exposure and comment. Read the July 2011 paper, Losing the excess baggage - reducing disclosures in financial statements to what's important.

Integrated reporting - Exploring the business benefit

2011-08-24T10:31:00.002-04:00

Black Sun is one of Europe’s leading strategic corporate communications consultancies. It brings together corporate reporting, corporate responsibility communications and digital communications for clients to create powerful integrated solutions. Offering a combination of strategic research and analysis, and ambitious creative thinking, it aims to help large UK and international organizations produce effective communications that build greater trust and confidence with their stakeholders.

Black Sun has carried out extensive research about current integrated reporting on a country-by-country basis, examining a sample of over 100 companies from 8 of the G20 countries, with representation from both developed and emerging markets. A Seminar will be held in London on August 31, 2011 to provide a summary of this international integrated reporting research and to provide an in-depth analysis of those companies that are found to be leading the way.

(View recent research reports, briefing papers and other guidance, such as the publication on Integrated Reporting – Exploring the Business Benefit at the Black Sun website.)

CICA Financial Reporting and Accounting Conference (IFRS and ASPE)

2011-08-19T15:23:00.000-04:00

The Canadian Institute of Chartered Accountants (CICA) is presenting its annual Financial Reporting and Accounting Conference on September 26-27, 2011 (optional workshops, September 28) at the Metro Toronto Convention Centre in Toronto, Canada. This conference is Canada’s leading financial reporting and accounting event and provides an up-to-date and extensive review of the most critical current and emerging issues facing both publicly-traded and privately-held corporations in Canada. Extensive coverage of the latest developments in both International Financial Reporting Standards (IFRS) and Accounting Standards for Private Enterprises (ASPE) will be delivered by prominent Canadian, US and international speakers. In-depth workshops addressing the most relevant and challenging financial reporting topics will also be available. (For more information on CICA Continuing Education products, visit the online CA Learning Centre.)

PwC Thought Leadership Highlights

2011-08-16T10:41:00.001-04:00

Every month, PricewaterhouseCoopers (PwC) delivers a range of Thought Leadership materials that explore key business issues affecting companies around the world. This month the focus is on a variety of issues that address the following questions and more: What's the key to successful business innovation? What are the implications of the proposed FASB/IASB revenue recognition changes? How are businesses adapting to the changing needs of their talent? What's next for nuclear power? (for example, see View:Striking the innovation balance).

Also, experience the popular 10Minutes series on your iPad, now enhanced with new multimedia. With this inaugural issue, 10Minutes on the CEO Agenda, explore the eight pressing questions facing CEOs today, hear about the challenges directly from business leaders around the world. 10Minutes on the Cloud discusses how cloud computing can go beyond cost savings to offer a way to improve innovation and organizational agility, provide better customer engagement, and harness resources to focus on business imperatives.

Deloitte’s Top 10 Canadian TMT Predictions for 2011

2011-08-11T09:03:00.017-04:00

In 2011, Canadian consumers and enterprises will continue to move away from a predictable but narrow world of standardized computing devices and are voting with their wallets in favour of diversity of choice. Between PCs, netbooks, tablets and smartphones, buyers must choose among a wide array of functionalities, platforms, operating systems, sizes, features and price points. Like kids in a candy store, consumers and enterprises will be both excited and overwhelmed by the sheer variety of options available to them. Canadians will use these various devices while shopping, while working, for social networking and for media consumption. (Read more about Deloitte’s Top 10 2011 Canadian TMT Predictions and download the Report.)

ACCA launches online Virtual Research & Insights Conference

2011-08-10T10:33:00.000-04:00

More than 6,000 finance professionals have signed-up for the Association of Chartered Certified Accountants (ACCA) online Research & Insights Conference which launched last week. The conference sessions can be viewed on-demand via the ACCA website until October 27, 2011.

HRH Prince of Wales delivered a live address at the conference on his involvement with the Accounting for Sustainability Project, as part of the session on integrated reporting. The online audience also heard from Professor Mervyn King, deputy chair of the International Integrated Reporting Committee (IIRC), who talked about the future scope of integrated reporting, as well as the benefits and challenges of creating a framework that brings together financial, environmental, social and governance information in a clear, concise and comparable format.

The conference covered a wide range of topics from a wealth of expert speakers, including: the new business environment: opportunities for growth; why talent management in finance matters; integrated reporting: a framework for the future; financial issues from Brussels; extended audit reporting; the eProfessional: creating the next generation of accountants; making businesses accountable; cloud computing; social media; and XBRL.

(View the ACCA conference program and ACCA Attendee Guide, then register to access the conference presentations.)

Netwatch - Smartphones are changing everything

2011-08-09T09:01:00.021-04:00

Jim Carroll recently noted that: "I was invited to talk to 250 students for my son’s Grade 12 class. When I ran the first text-message poll, I had about 247 responses within 60 seconds. For members of this generation, texting is like oxygen; their mobile smartphone is their view into the world. They’ll look at something like text-message-based banking and think it is a great idea. ...This speaks to a huge trend: significant business model change as a result of the impact of mobile or smartphone technology. ...And the trend isn’t limited to financial services — it’s happening in virtually every industry." To learn more, read the article "Smartphones are changing everything" in the August 2011 issue of CAmagazine online.

IFRS: the first quarter

2011-08-04T09:08:00.009-04:00

The first IFRS Canadian corporate report filings are now in. How did the implementation go? What went right? What went wrong? What can we expect in the future? With a number of major IFRS projects underway at the International Accounting Standards Board — policy decisions for leases and financial instruments — the new reporting landscape is still a live environment. For a review of how selected companies were able to prepare their first IFRS reports, read the article "IFRS: the first quarter" in the August 2011 issue of CAmagazine online.

Interim Reporting Under IFRS — An Update

2011-08-02T10:46:00.000-04:00

CPR Alert (Issue 14, July 2011) is a non-authoritative bulletin prepared by staff of the Canadian Performance Reporting Board (CPRB) at the Canadian Institute of Chartered Accountants (CICA). This issue, Interim Reporting Under IFRS — An Update, reviews: Filing deadlines – no extension for Q2 and Q3; Items to include in Q2 and Q3 2011 interim financial reports; Auditor review of interim financial reports; MD&A considerations for Q2 and Q3 2011; and Classification of bankers acceptances under IFRS. In addition, the Ontario Securities Commission published IFRS Release No. 3 – IFRS Interim Financial Reports –Tips For Q2 And Q3 on July 7, 2011. That release provides a useful filing tip sheet for Q2 and Q3.

What ethics means in business

2011-07-28T09:17:00.002-04:00

On July 15, 2011, the Globe and Mail convened a panel of experts to discuss why companies should act with integrity. The panel comprised: Paul Klein, the founder of Impakt; Don McCreesh of Imagine Canada; Andrew Wilcynski, director of cause marketing for Telus; and Ben Packard, VP of global responsibility with Starbucks. Watch the video on What ethics means in business. Also, view related videos on corporate social responsibility at the Globe and Mail online.

Leveraging XBRL for Value in Organizations

2011-07-26T15:13:00.001-04:00

The International Federation of Accountants (IFAC) and ISACA have jointly developed the paper Leveraging XBRL for Value in Organizations to provide accounting and assurance professionals with guidance to leverage value from XBRL (eXtensible Business Reporting Language) initiatives and compliance requirements. The benefits and opportunities of embedding XBRL within internal processes can enhance management communication and increase the value of data used within an organization. Examples and case study material are included, as well as XBRL Resources.

Six Key Trends that are Shaping the Business World

2011-07-19T09:04:00.021-04:00

A 2011 Ernst & Young report Tracking Global Trends looks at six broad, long-term developments that are shaping our world. Key trends include: Emerging markets increase their global power; Cleantech becomes a competitive advantage; Global banking seeks recovery through transformation; Governments enhance ties with the private sector; Rapid technology innovation creates a smart, mobile world; and Demographic shifts transform the global workforce.

The three underlying drivers that have helped establish and perpetuate these trends are:

Demographic shifts. Population growth, increased urbanization, a widening divide between countries with youthful and quickly aging populations and a rapidly growing middle class are reshaping the business world and society as a whole.
Reshaped global power structure. As the world recovers from the recession, the rise of relationships between the public and private sectors has shifted the balance of global power faster than most could have imagined just a few years ago.
Disruptive innovation. Innovations in technology continue to have massive effects on business and society. Emerging markets are now becoming hotbeds of innovation, especially in efforts to reach the growing middle class and low-income consumers around the globe.

Canadian Public Accountability Board (CPAB) Report 2011

2011-07-14T15:24:00.001-04:00

Since its incorporation in 2003, the Canadian Public Accountability Board (CPAB) has issued seven annual public reports. The first five reports summarized inspection findings. Two years ago, CPAB changed its approach to focus on the root causes of audit deficiencies and to highlight the key recommendations that, if implemented, would have the greatest impact on improving audit quality. In the past year, CPAB has enhanced its risk assessment capabilities and now uses a more robust risk analysis process to identify high risk firms and audit engagements, improving the effectiveness of its inspections. CPAB has also increased the frequency of its inspections of firms that audit fewer than 100 reporting issuers.

According to CPAB, audit quality in Canada continues to be sound. Nonetheless, the 2010 inspections showed no significant improvement in audit quality from the previous year. The report identifies the major areas that would enhance audit quality. These include engagement supervision and review, application of professional skepticism, improving substantive analytical procedures, providing sufficient audit evidence, improving communication with audit committees, preparing significant issues and completion memos, and enhancing consultation on 25 complex, non-routine transactions.

(Read the CPAB Report on the 2010 Inspections of the Quality of Audits Conducted by Public Accounting Firms, issued in April 2011.

Transocean: No Apologies Over Gulf Oil Spill

2011-07-12T15:40:00.000-04:00

"Fourteen months after the Deepwater Horizon drilling rig exploded 50 miles southeast of Venice, La., killing 11 men and setting off the largest offshore oil spill in U.S. history, Transocean (RIG), the company that owned and ran the ill-fated 32,600-ton vessel, finally issued its official account of what happened and why. It produced a report on June 22 of no fewer than 854 pages, divided into two volumes, and spared no detail. The bottom line, though, isn’t complicated:It was BP’s (BP) fault." (Read the full story "Transocean: No Apologies Over Gulf Oil Spill" at Bloomberg Businessweek online.)

About the Global Accounting Alliance

2011-07-07T11:17:00.001-04:00

The Global Accounting Alliance (GAA) comprises 11 of the world's leading professional accountancy institutes. It represents more than 775,000 professional accountants in over 165 countries from around the globe. The GAA promotes quality services, shares information and collaborates on important international issues. As part of this effort, the GAA publishes a bi-monthly online journal. GAA Accounting includes authoritative yet accessible articles to advance the understanding of theory and practice in accounting, business finance and related subjects for members around the world. The June 2011 edition is available online and also as a Digital Edition.

About the National Investor Relations Institute (NIRI)

2011-07-05T10:29:00.000-04:00

Founded in 1969, the National Investor Relations Institute (NIRI) is the professional association of corporate officers and investor relations consultants responsible for communication among corporate management, shareholders, securities analysts and other financial community constituents. The largest professional investor relations association in the world, NIRI’s more than 3,500 members represent 2,000 publicly held companies and $5.4 trillion in stock market capitalization. Investor relations is a strategic management responsibility that integrates finance, communication, marketing and securities law compliance to enable the most effective two-way communication between a company, the financial community, and other constituencies, which ultimately contributes to a company's securities achieving fair valuation. (See IR Weekly and the President's Blog for the latest news and developments in investor relations.)

Sustainability Framework 2.0: Professional Accountants as Integrators

2011-06-29T09:08:00.005-04:00

“The role of leadership and business strategy is to promote the integration of sustainability issues at a strategic level, so that they are embedded in organizational development covering strategy, planning, enterprise risk management, and operations. The importance of tone at the top is best captured by the King Code of Corporate Governance for South Africa, which specifically encourages the integration of governance and sustainability into strategy, operations, and reporting of an organization. The philosophy of the King code revolves around leadership, sustainability and corporate citizenship. Responsible leaders direct company strategies and operations with a view to achieving sustainable economic, social and environmental performance.” (Read the publication Sustainability Framework 2.0: Professional Accountants as Integrators, issued by the International Federation of Accountants (IFAC) in March 2011.)

Integrating the Business Reporting Supply Chain

2011-06-27T10:21:00.000-04:00

High-quality business reporting lies at the heart of strong capital markets and sustainable economic growth. All those involved in the business reporting supply chain play a critical role in making business reports more relevant, understandable and reliable. This will enable the various stakeholders who use those reports to make informed decisions with respect to an organization’s social, environmental, and economic performance.

Recent interviews with key business leaders from around the globe capture recommendations on governance, financial reporting, financial auditing, and broader business reporting from prominent preparers, directors, auditors, standard setters, regulators and investors. This report analyzes what, according to interviewees, the various participants in the business reporting supply chain should do to further improve governance and the usefulness of business reports, as well as the preparation and audit of those reports. Unless otherwise stated, the recommendations in this report apply to all organizations and businesses. (For more information, read the March 2011 IFAC report Integrating the Business Reporting Supply Chain.)

IBM celebrates 100 years

2011-06-24T09:00:00.007-04:00

“Of the top 25 industrial corporations in the United States in 1900, only two remained on that list at the start of the 1960s. And of the top 25 companies on the Fortune 500 in 1961, only six remain there today. Some of the leaders of those companies that vanished were dealt a hand of bad luck. Others made poor choices. But the demise of most came about because they were unable simultaneously to manage their business of the day and to build their business of tomorrow. As you read this, IBM begins its 101st year. Today we take a moment to step back and view the longer arc of history. We’d like to share some of what we have learned—sometimes in humbling ways—on our journey so far.” Read the full essay on the IBM 100 website. Explore an evolving collection of stories about the 100 IBM innovations that helped shape the last century. Celebrate IBM’s 100-year history with commemorative memorabilia designed exclusively for IBMers, families and friends.

20 Questions Directors Should Ask about Information Technology Security

2011-06-22T11:30:00.008-04:00

“The CICA’s Information Technology Advisory Committee developed this booklet to guide Boards of Directors in evaluating information technology (IT) security issues. It should also be of use to other bodies responsible for governance — in particular audit committees and strategic bodies such as IT steering committees, risk management committees, and CEO/CFO controls certification committees. Directors are expected to satisfy themselves that risks potentially jeopardizing the integrity of information, the availability of information and operational systems, the confidentiality of sensitive data, and compliance with regulatory bodies, are identified and reduced or eliminated. This booklet provides questions for Boards to ask senior management as well as the context needed to ask the questions and assess responses. In this document, IT Security (Security) is defined as the protection of data captured, processed, transmitted, reported and stored electronically. IT Security also covers the protection of related components such as application systems, system software, networks and hardware, as well as the supporting people, policies, procedures, processes and organization.” (Read the CICA publication 20 Questions Directors Should Ask about Information Technology Security.)

Green Gauge

2011-06-17T15:10:00.001-04:00

The idea that business organizations have a responsibility to account for their impact on the environment once seemed radical, even eccentric. Now, it is accepted as a mainstream concept – but to put it into practice, corporate reporting will have to evolve dramatically. It’s a challenge to which the accountancy profession must step up, if it is to retain its relevance in the 21st century. As a start, the Sustainability Advisory Group of the Institute of Chartered Accountants of Scotland (ICAS) has launched a dedicated section on the institute’s website providing links to a number of useful resources and a template Corporate Social Responsibility Report. (Read the article “Green Gauge” in the May 2011 issue of CA Magazine (Scotland) online.)

Data-Centric Security - A CICA White Paper

2011-06-15T09:12:00.014-04:00

In most organizations, data that was once static and stored in one place now moves freely from platform to platform throughout the organization and beyond. Because data is now often generated and modified by users and is resident in different forms and versions in different places simultaneously, maintaining a secure environment is a growing challenge. A White Paper issued by the Canadian Institute of Chartered Accountants (CICA) suggests that a data-centric policy should be the focus for management, auditors and others involved in securing data in this new mobile environment. The term “security” is taken in its broadest sense to include confidentiality, integrity (accuracy, completeness and validity) and availability. (Read the CICA publications on Data-Centric Security and

20 Questions Directors Should Ask About IT Security.)

A Framework for Board Oversight of Enterprise Risk

2011-06-13T09:04:00.004-04:00

The Risk Oversight and Governance Board of the Canadian Institute of Chartered Accountants (CICA) has developed "A Framework for Board Oversight of Enterprise Risk" to provide a practical approach to risk oversight, including a methodology and tools designed specifically for boards of directors. The framework includes a nine-part process to assist boards in better identifying and addressing critical risk as well as understanding the inter-connectivity of risks.

Social IR becoming more important in Europe, says study

2011-06-10T08:56:00.019-04:00

"While investor relations departments in Germany, Austria, Switzerland and the UK mostly shy away from using social media, there is a growing belief that new media will become increasingly important to their communications with investors in the next 12 months, a new survey has found. The survey by the German investor relations association DIRK and international market research firm GfK polled more than 700 investor relations departments across the four countries. It found that relatively few are currently using social media in their IR programs, with only 12% German, 24% of Austrian and Swiss, and 26% of British IR departments saying they consider social media important or very important to their current IR activities. However, going forward 71% of Austrian, 62% of Swiss, 61% of British and 46% of German companies expect social media to become important or very important to their IR programs in the coming year." (Read the full article “Social IR becoming more important in Europe, says study” by Dominic Jones at IR Web Report online.

Canadian income tax, then and now

2011-06-08T09:08:00.002-04:00

It has been almost 40 years since Canada overhauled its tax system, eliminating estate duties and bringing in capital gains tax. Since 1972, we have seen no less than 49 editions of the Income Tax Act. Its length has increased enormously and the complexity exponentially. Changes in technology have aided the Canada Revenue Agency in the selection and audit of taxpayers. Ever-changing legislation, powerful audit tools, information exchange agreements and anti-avoidance rules have made tax planning harder, tax compliance more challenging and tax enforcement easier with key changes over the past 40 years and challenges presented to the accounting profession. (Read the article “Income tax, then and now” in the June-July 2011 issue of CAmagazine online.)

CICA Corporate Reporting Awards celebrate 60 years of excellence

2011-06-06T09:07:00.012-04:00

This year marks the diamond anniversary of the Chartered Accountants of Canada’s Corporate Reporting Awards. Since 1941 the program has been centre stage in Canada’s evolution to best practice reporting models. By providing important recognition for those committed to advancing business reporting, the program has helped drive the development of best practices in financial reporting, corporate governance disclosure, electronic disclosure and sustainable development reporting, all of which are now regarded as essential components of the corporate reporting model. Judging organizations include the Canadian Institute of Chartered Accountants (CICA), PricewaterhouseCoopers, Ernst & Young, Deloitte, International Institute for Sustainable Development, Canadian Investor Relations Institute, and Toronto CFA Society. (Read the article “Corporate Reporting Awards celebrate 60 years of excellence” in the June-July 2011 issue of CAmagazine online.)

OPEN Forum Social Media Hub

2011-06-01T09:06:00.024-04:00

American Express offers an online OPEN Forum Social Media Hub. To discover the mix of tools and tactics best suited for a business, the site provides a collection of relevant content including clips from a Social Media panel, OPEN Book: Social Media, Insight Guides, expert articles and more.

Harnessing the opportunities and managing the risks of social media

2011-05-30T09:05:00.016-04:00

According to a recent publication by Deloitte, virtually every organization is either using or considering social media for internal and external use. Now, the question is how to use social media effectively, while managing the risks it presents for businesses. Social media presents unparalleled opportunities for growth, innovation, customer and competitive intelligence, early risk identification and diffusion. (To learn more, read Enterprise 2.0: Harnessing the opportunities and managing the risks of social media.)

Integrating sustainability into business practices: a case study approach

2011-05-27T09:48:00.013-04:00

Integrating sustainability into business practices: a case study approach was prepared for the Institute of Chartered Accountants in Australia by Kiewa Consulting Pty Ltd. This paper provides some business case studies that shed light on the journey towards sustainable business practices, and some simple steps that should help business leaders take their part in it. The five cases studies include the following organizations: Blackmores; Intrepid Travel; National Institute of Water & Atmospheric Research (NIWA); Woolworths; and World Vision Australia. (Also see Spotlight on integrated reporting.)

Tomorrow’s corporate reporting – a critical system at risk

2011-05-25T09:01:00.023-04:00

Corporate reporting matters: it plays an essential role in the effective functioning of the market economy. It should make an important contribution to our understanding of, and respect for, business and the financial sector as creators of value by explaining what drives that value now and in the future. The Chartered Institute of Management Accountants (CIMA), PricewaterhouseCoopers and Tomorrow’s Company set up a global study to explore the barriers to the effective development of corporate reporting and the report summarizing the research has now been published. The report explains the findings from the perspective of a number of market participants – companies, auditors, shareholders, investors, standard setters and regulators. Looking forward the research team has also set out the key principles of an agenda for debate and a roadmap for change in the corporate reporting system. (Visit the CIMA website and download Tomorrow’s corporate reporting – a critical system at risk.)

CICA/RBC Business Monitor Report (Q1 2011)

2011-05-23T09:02:00.025-04:00

The majority of executive Chartered Accountants (CAs) (64%) expressed optimism about the Canadian economy in the first quarter of 2011, marking a notable increase of 23% over the previous quarter, according to the latest CICA/RBC Business Monitor (see the Backgrounder for details). Canadian interest rates and consumer confidence were the top two reasons cited among respondents for the surge in optimism to near record levels. In addition, 66% of respondents in the first quarter survey were optimistic about their company’s prospects over the next year, up 10% from the previous quarter. (Read the CICA Media Release.)

Defined benefit pensions at tipping point

2011-05-16T09:04:00.026-04:00

A new survey of more than 150 Canadian pension plan sponsors from professional services firm Towers Watson indicates that just over half (51%) of the private sector defined benefit (DB) plan respondents have now converted their plans to defined contribution (DC) arrangements for current or future employees - up from 42% in 2008. The survey also reveals that recent improvements in economic conditions have had virtually no impact on executives’ perception of a DB funding crisis. The percentage of respondents who agree there is a pension funding crisis has remained at historic highs since the financial downturn of 2008. The survey found that more than half of respondents (56%) believe that the funding crisis will persist for the long term, compared with 34% who held this view in 2008 before the recession. Just under one third (32%) perceive funding challenges to be a cyclical phenomenon. (Read the article “Definedbenefit pensions at tipping point” at Towers Watson online.)

Investors spend just 5 minutes on annual reports, according to the stats

2011-05-13T14:12:00.000-04:00

“WEB traffic statistics compiled by Google show that investors are spending less than 5 minutes viewing annual meeting materials hosted by large vendors – and younger investors are almost entirely ignoring the documents. The statistics, which aggregate traffic to hundreds of online annual reports and proxy statements hosted by large vendors such as Thomson Reuters, Broadridge Financial Solutions and Computershare, suggest that companies’ disclosure documents are failing to hold the interest of web users, particularly younger users between the ages of 18 and 34 who have grown up with the web. Further evidence of a lack of investor interest in online annual reporting information is provided by statistics compiled using PostRank. They show little or no interest in company annual reports among users of social networking websites, as measured by the number of times they share links to online annual reports.” (Read the full article “Investors spend just 5 minutes on annual reports – stats” by Dominic Jones at IR Web Report online.

What's Next: Stay ahead of the future

2011-05-11T11:19:00.000-04:00

What’s Next is a trends report offering clear, concise and non-sensationalist commentary on trends in society, business, science & technology, government and the environment. Each issue covers trends across twelve sectors and speculates about future risks and opportunities. The current issue of What’s Next is available free of charge on an online basis. Readers might also like to check out the Top Trends Blog.

That's Summa Story - From the Caves to Cafe Pacioli

2011-05-09T09:12:00.008-04:00

Accountants are generally recognized as making a valuable contribution to society, by providing the information that allows entrepreneurship to flourish, business to operate efficiently, stakeholders’ interests to be protected, shares to be fairly priced, and taxation and audit requirements to be satisfied. Accounting, however, has not always enjoyed such an established position, and today there is often a tendency to take the profession’s status for granted. It is interesting, therefore, to examine the factors that have brought accounting to the preeminent place that it occupies today.To learn more about the history of accounting, read the article "That's Summa Story! From the Caves to Café Pacioli" by Derry Cotter, FCA. To access the full text of this article, see the Digital Edition of Accountancy Ireland, February 2011, (pages 50-53).

Using electronic communications between CA firms and clients

2011-05-06T09:06:00.007-04:00

Almost all CA firms are communicating at least some information to their clients electronically, according to the CICA’s most recent Managing a Public Practice (MAPP) survey on computerization. Nearly all firms represented in the survey send e-mails (99%), PDFs (96%) and other correspondence (93%) to their clients electronically. Four out of five firms (80%) send corporate tax returns to clients electronically. Personal tax returns (82%) and financial statements (87%) are also sent electronically by more than 80% of firms. The results are from a broader three-part MAPP CA practice benchmark survey conducted biannually with the partners of CA firms across Canada. (Read the article “Electronic Update” at CAmagazine online.)

ICAEW Library and Information Service - Gateway on Environmental, social and sustainability reporting

2011-05-04T09:00:00.006-04:00

Environmental, social and sustainability reporting have grown substantially over the last decade. The Institute of Chartered Accountants inEngland and Wales (ICAEW) provides access to a range of articles, publications and online resources including information on reporting trends and developments. (Visit the ICAEW Library and Information Service - Gateway on Environmental, social and sustainability reporting.)

Financial Reporting in Canada under IFRS 2011

2011-05-02T17:11:00.000-04:00

Financial Reporting in Canada under IFRS 2011 is a concise, practical reference source that looks at the application of International Financial Reporting Standards (IFRS) from a Canadian perspective. It examines and explains IFRS requirements, illustrating their application using real-world extracts of financial statements from companies that have already adopted IFRS. It also includes: comparisons of the requirements under Canadian GAAP and IFRS; tables, charts and diagrams summarizing the requirements in easy-to-read point form; and examples of application presented in short case studies. The publication is available for purchase from the CAstore online. A free sample chapter (Chapter20 – First-time Adoption of IFRS) is also available online.

Social media investor relations reaches tipping point

2011-04-29T09:08:00.033-04:00

According to a recent post on IR Web Report, "IT HAS become a tradition of sorts that quarterly earnings season kicks off when aluminum giant Alcoa Inc. (NYSE:AA) reports its results. ...when the company announced its results, much of the activity and evident investor interest took place outside of the company’s usual channels, on its social media and document sharing accounts. While this might once have seemed remarkable, it’s now fast becoming standard practice for scores of companies – and many more will likely join the parade in the coming weeks."

"In fact, company disclosure channels that once seemed innovative – such as investor relations websites, webcasting and PR wire services – are struggling to stay relevant as investors grow accustomed to receiving information from companies in real-time on their favorite social networks in formats that are easier to access and use. These changes are irreversible and were very much in evidence as Alcoa posted its numbers this week. ...I can’t say this loud enough: SOCIAL MEDIA IS NOW MAINSTREAM, and companies that haven’t yet started using social media in their IR programs are in danger of finding themselves talking to increasingly smaller audiences. We have reached the tipping point for social media in investor relations. If you’re not using social media in your IR program yet, you need to make it a priority and start right away." (Read the full article "Social media investor relations reaches tipping point" by Dominic Jones at IR Web Report online.

PwC's 2011 US GAAP and IFRS convergence survey results

2011-04-27T16:53:00.000-04:00

US financial reporting will undergo an unprecedented level of change within the next several years. On one hand, US companies face convergence between US GAAP and IFRS, affecting several major accounting standards. On the other hand, IFRS conversion warrants consideration. IFRS is already impacting business decisions, and not simply through non-US subsidiaries. Understanding both of these major changes, and their business and operational implications, is an imperative for US companies. US GAAP convergence & IFRS resources are available at PwC online, including PwC's 2011 US GAAP and IFRS convergence survey results.

IASB and FASB Report Progress on Convergence

2011-04-25T09:31:00.006-04:00

The International Accounting Standards Board (IASB) and the US Financial Accounting Standards Board (FASB) have published a progress report on their joint convergence projects. Since their previous report in November 2010, the boards have completed five projects. In the next few weeks, the IASB will issue new standards on consolidated financial statements (including disclosure of interests in other entities), joint arrangements and post-employment benefits. Both boards will issue new requirements in relation to fair value measurement and the presentation of other comprehensive income. In addition, the boards have made progress on the three remaining Memorandum of Understanding (MoU) projects — financial instruments accounting, leasing and revenue recognition — as well as insurance accounting. The boards have also agreed to extend the timetable for the remaining priority convergence projects beyond June 2011 to permit further work and consultation with stakeholders. The convergence projects are targeted for completion in the second half of this year. (Read the full article "IASB and FASB Report Progress on Convergence" at Journal of Accountancy online.

Confronting Complexity: How business globally is taking on the challenges and opportunities

2011-04-22T09:14:00.010-04:00

A new study from KPMG International examines the causes and impact of complexity among businesses globally. The study shows that businesses are taking significant action to address complexity, particularly in the areas of information management, business organization and human resources, but success has been mixed. More than 90% of senior executives say their organization’s success depends on managing today’s complex business issues, but less than half believe the actions they are taking to manage complexity have been very effective. The study, Confronting Complexity: How business globally is taking on the challenges and opportunities, is based on interviews with 1,400 senior executives in 22 countries. The research found that at least 7 out of 10 executives believe complexity can create new opportunities for their businesses, including gaining competitive advantage, creating better strategies, expanding into new markets and improving efficiencies.

IIRC to meet in New York City on May 13, 2011

2011-04-20T09:09:00.004-04:00

The International Integrated Reporting Committee (IIRC) will be meeting in New York City on May 13, 2011. The objective of the meeting is to discuss and agree on a Discussion Paper on Integrated Reporting. That Paper is to be released for business and investor testing and public consultation in June 2011. It will present proposals for an Integrated Reporting framework at the time of the G20 Finance Ministers meeting in October 2011. The IIRC is also undertaking a pilot program to give organizations the opportunity to test and provide feedback on the development of the Integrated Reporting framework. The initial phase of the pilot program will involve company and investor testing of the Integrated Reporting Discussion Paper in June-July 2011, followed by a full pilot program in September 2011 for a two year reporting cycle. (Read the IIRC announcement and get More information about the pilot program.)

Canadian regulator issues guides on IFRS

2011-04-18T09:08:00.001-04:00

The Ontario Securities Commission (OSC) has issued two high-level guides on the impacts of IFRS: Deciphering IFRS - What Analysts Need To Know About IFRS Transition and Investing in the New Era - What Investors Need To Know About IFRS Transition. The guides outline a number of questions for analysts and investors to consider and are available on the OSC website.

CEO Round Table - What do the leaders of the top seven CA firms think about key issues?

2011-04-15T10:45:00.000-04:00

In December 2010, Kevin Dancey, president and CEO of the Canadian Institute of Chartered Accountants (CICA), hosted a round table discussion with the CEOs of the top seven accounting firms. The discussion covered a wide range of topics of interest to the profession. Participants included Chris Clark of PricewaterhouseCoopers, Keith Farlinger of BDO Canada, Trent Henry of Ernst & Young, Alan MacGibbon of Deloitte, Phil Noble of Grant Thornton, Daryl Ritchie of Meyers Norris Penny and Bill Thomas of KPMG. Also present was Bill MacKinnon, chairman of the CICA. Read what these leaders had to say about key issues in the article "CEO Round Table" at CAmagazine online.

Integrated Reporting Workshop Videos - Harvard Business School

2011-04-13T14:58:00.000-04:00

A series of about 30 YouTube videos has recently been posted by the Harvard Business School. The videos cover the various speaker presentations at the Workshop on Integrated Reporting which was held at the Harvard Business School on October 14-15, 2010. The Workhop was discussed in a previous blog posting on December 1, 2010.

FEE Factsheet on Integrated Reporting

2011-04-06T09:00:00.001-04:00

Debates and developments around the concept of “integrated reporting” are growing in importance. According to the FEE (Fédération des Experts-comptables Européens - Federation of European Accountants), “integrated reporting is a holistic approach to enable investors and other stakeholders to understand how an organisation is really performing. Addressing the wider as well as longer-term consequences of decisions and actions, an integrated report makes clear the link between financial and non-financial value. The relationship between an organisation's strategy, governance and business model should be transparent through such reporting. It also gives an analysis of the impacts and interconnections of material opportunities, risks and performance across the value chain.” The FEE represents 45 professional institutes of accountants and auditors from 33 European countries, including all 27 EU Member States. (Read the FEE Factsheet on Integrated Reporting.

The whys behind sustainability

2011-04-04T10:52:00.000-04:00

Compliance with legal and regulatory requirements is the most frequently cited driver of company sustainability initiatives in Canada, the UK and the US, according to a survey conducted jointly by the Canadian Institute of Chartered Accountants, the Chartered Institute of Management Accountants and the American Institute of Certified Public Accountants. Managing risk to the reputation of the company brand was the next most likely response, followed by achieving competitive advantage and long-term profitability. Read the article “The whys behind sustainability” in CAmagazine online.

Upcoming Canadian IFRS Survey: Stay Tuned

2011-03-31T10:19:00.000-04:00

International Financial Reporting Standards (IFRS) are changing at a rapid pace and companies can expect to see new standards effective as soon as 2014. The International Accounting Standards Board (IASB) intends to improve financial reporting information for investors while also aligning US and international accounting standards. Are you aware of the proposed changes? How ready are you for these changes? PricewaterhouseCoopers (PwC) will soon be conducting an open survey on some key expected changes to IFRS and what Canadian companies think the potential impact may be. The survey will be sent to all IFRS News subscribers and will be accessible from the PwC website.

Professor Mervyn King explains Integrated Reporting

2011-03-28T09:01:00.003-04:00

South Africa is the first country to issue specific guidelines defining the content of an integrated report for listed companies. Integrated Reporting is now a stock exchange listing requirement for South African companies and will replace the old form of annual report which focused primarily on financial information and the short-term horizon. In a series of YouTube videos uploaded by the South African Institute of Chartered Accountants (SAICA), Professor Mervyn King explains Integrated Reporting, at the launch of South Africa's new Framework for Integrated Reporting and the Integrated Report Discussion Paper. The SAICA is the foremost accountancy body in South Africa and one of the leading Institutes in the world. It serves the interests not only of the Chartered Accountancy profession, but also of society in general through its key objective of upholding professional standards and integrity.

Global Reporting Initiative - G3.1 Sustainability Reporting Guidelines

2011-03-24T16:26:00.000-04:00

The Global Reporting Initiative (GRI) has released guidelines that it describes as the most comprehensive sustainability reporting guidance now available. The G3.1 Sustainability Reporting Guidelines feature expanded guidance on issues including local community impacts, human rights and gender, as well as environmental, product responsibility, labor, governance and other existing GRI categories. GRI is also launching guidance to help companies determine what to measure and report on. The organization says that this publication, Technical Protocol – Apply the Report Content Principles, will allow companies to produce relevant reports more easily.

Estimating the Fair Value of Investments

2011-03-21T10:11:00.000-04:00

In September 2006, the US Financial Accounting Standards Board (FASB) issued Statement of Financial Accounting Standards (SFAS) 157, Fair Value Measurements (now Accounting Standards Codification [ASC] section 820-10, Fair Value Measurements and Disclosures), with the stated objective of simplifying the measurement and disclosure of fair value information. The application of this guidance to investments in certain nonpublic entities, such as alternative investments, proved more difficult than originally envisioned. Read the CPA Journal article "Estimating the Fair Value of Investments in Entities that Calculate Net Value Per Share" in digital format.

Preparing for the Unexpected

2011-03-18T10:19:00.000-04:00

Operational risk is an evolving discipline in which many global banks are either currently improving their scenario analysis processes or actively thinking about doing so. This executive summary is the outcome of a study by KPMG in conjunction with the ORX Association, the leading global operational risk data exchange and association in the industry. Visit the KPMG website and read the full report on Preparing for the Unexpected. Also, view KPMG's Financial Services Risk and Regulatory Centers of Excellence video.

AICPA/CICA Privacy Maturity Model

2011-03-16T09:49:00.000-04:00

The AICPA/CICA Privacy Maturity Model (PMM) is based on Generally Accepted Privacy Principles (GAPP) and the Capability Maturity Model which has been in use for almost 20 years. In developing the PMM, it was recognized that each organization’s personal information privacy practices may be at various levels, whether due to legislative requirements, corporate policies or the status of the organization’s privacy initiatives. It was also recognized that, based on an organization’s approach to risk, not all privacy initiatives would need to reach the highest level on the maturity model. Each of the 73 GAPP criteria is broken down according to the five maturity levels. This allows entities to obtain a picture of their privacy program or initiatives both in terms of their status and, through successive reviews, their progress. (For more information, visit the CICA Privacy Resource Centre online.)

Setting the standard - What you need to know about the FASB and IASB's joint projects

2011-03-14T09:49:00.000-04:00

The March 2011 edition of the PricewaterhouseCoopers (PwC) publication, Setting the Standard, is designed to keep readers informed about the most recent developments on the joint standard-setting activities of the Financial Accounting Standards Board (FASB) and the International Accounting Standards Board (IASB). In the December 2010 edition, PwC reported that the boards had recalibrated their work plan to focus on the priority projects. The boards continue their sprint toward the targeted June 30, 2011 “finish line,” carefully navigating the hurdles along the way.

Whom Do Public Companies Now Serve?

2011-03-11T09:53:00.001-05:00

Integrated reporting is becoming a reality in the United States. Southwest Airlines issued its first integrated report in 2009, combining financial and non-financial performance assessments, including information on corporate responsibility goals. By instituting this new form of annual report, which it calls “One Report” or “Performance, People, Planet,” Southwest Airlines has placed these broader goals on the same path as corporate performance. The company has codified its accountability to multiple constituencies. (See “Whom Do Public Companies Now Serve?” at Forbes online.)

Smarter Evidence and Discovery Management

2011-03-09T10:04:00.001-05:00

"There is no question that the influence and role of eDiscovery in litigation in Canada continues to develop. While eDiscovery has been a fixture in the US for many years, there has been a slower, pragmatic and perhaps sensible approach to the disclosure of electronic documents in this country. However, as documents are now overwhelmingly formed and maintained primarily in electronic form, it is acknowledged that eDiscovery has arrived in Canada and is here to stay." Visit the KPMG website and read the publication Smarter Evidence and Discovery Management.

Effective IFRS communications with stakeholders

2011-03-07T09:06:00.005-05:00

Effective communication cannot happen without an understanding of the needs of the audience. In preparing the first IFRS interim reports, adopters should try to look at the information through the same lens as the people who are seeing it for the first time, most of whom are on a steep IFRS learning curve. Will the readers of those reports be able to discern whether changes are a reflection of business performance or the new standards? Helpful resources can be found on the CICA’s IFRS website including: (1) IFRS Financial Statements – Examples: A sampling of interim IFRS financial statements provided by first-time adopters. (2) Meeting Regulatory Requirements: A web page that provides OSC guidance on MD&A disclosure, including a publication called Ontario Securities Commission Issuer Guide: Top 10 Tips for Public Companies Filing Their First IFRS Interim Financial Reports. (3) A Review of 2010 Financial Statement Disclosures and What to Expect in 2011: An audio/slide presentation that discusses how financial analysis will be different in an IFRS world. The CICA is providing free access to this recording. Other useful IFRS audio presentations are available at the CICA Xtensions Learning Centre.

PwC webcasts - US GAAP & IFRS Convergence Series

2011-03-04T09:00:00.012-05:00

The next PricewaterhouseCoopers (PwC) webcast in the US GAAP & IFRS Convergence Series is scheduled for Tuesday, March 15, from 1:00pm to 2:30pm (ET). This webcast will begin with a recap of recent developments and close with some recommendations regarding next steps. Speakers on the webcast panel will: provide a brief update on the convergence agenda; summarize results to survey questions; discuss recommended next steps; and answer questions during a Q&A session. Additional US GAAP convergence & IFRS resources are available at PwC online, along with archives for previous webcasts.

Research on Corporate Disclosures

2011-03-02T09:07:00.004-05:00

Why do some companies provide extensive forward-looking disclosures while others remain relatively silent? What prompts some companies to disclose important discretionary information in their letter to shareholders rather than in the management discussion and analysis (MD&A)? Is the extent of disclosure likely to change as companies move to adopt IFRS? Recent developments in academic research help address these and other questions. Literature on voluntary versus mandatory disclosures and a sample of Canadian public companies illustrate the form and content of forward-looking disclosures in Canadian annual reports. Scan the article “Corporate Disclosures” in the March 2010 edition of CAmagazine online and learn more by reading the CICA research study Corporate Reporting to Stakeholders (June 2008).

AICPA Top Technology Initiatives Survey 2011

2011-02-28T09:04:00.011-05:00

The American Institute of Certified Public Accountants (AICPA) 2011 Top Technology Initiatives Survey rates the proliferation of smartphones, tablet computers and mobile devices in the workplace as the top business technology concern. Mobile devices edged out information security, which had topped the list of tech concerns several years in a row. The survey provides feedback on the technology issues that are of greatest importance, as well as emerging technologies. (Read the article "Mobile Devices Top CPAs' Tech Survey Rankings" in the Journal of Accountancy online.)

FINTRAC ANNUAL REPORT 2010 - Ten Years of Connecting the Money to the Crime

2011-02-22T15:38:00.000-05:00

During 2010, FINTRAC, as Canada’s financial intelligence unit, celebrated its tenth anniversary. (Refer to the publication FINTRAC ANNUAL REPORT 2010 - Ten Years of Connecting the Money to the Crime.)

FINTRAC made 579 (556 in 2008-09) disclosures of information relevant to investigations of money laundering, terrorist financing, and/or threats to the security of Canada. Turnaround time on cases improved 17%, and requests for assistance went up 36%. By using electronic media for case disclosures, it sharply reduced delivery times, and provided a more flexible product for law enforcement and intelligence partners to work with.

FINTRAC published a new series of strategic intelligence assessments focusing on terrorist groups and countries arousing national security concerns, as well as reports informing partners about current and emerging typologies and trends in money laundering and terrorist financing. It was also the Canadian lead for the FATF typology project about the use of new payment methods for money laundering purposes.

The Office of the Privacy Commissioner (OPC) issued a report praising the Centre's management of personal information, and recommended the appointment of a Chief Privacy Officer. FINTRAC was pleased to implement this and other OPC recommendations.

(See Highlights from FINTRAC's 2010 Annual Report.)

Role of audit committees in the transition to IFRS

2011-02-18T10:27:00.000-05:00

Audit committees play an important role in the transition to International Financial Reporting Standards (IFRS). National Instrument 52-110, Audit Committees, requires audit committees to review the issuer’s interim financial statements, related MD&A and interim earnings press releases before the information is made publicly available. For an issuer filing its first IFRS interim financial report, this report will contain the expanded disclosure required by IFRS 1 and securities law. In many organizations, the board looks to the audit committee for insight into the soundness of the entity’s transition strategy and to monitor and review its progress. In addition, the audit committee can be an important sounding board for management. The Board/Audit Committee webpage on the CICA’s IFRS website provides a number of helpful resources.

Top 10 CSR Research Findings in 2010

2011-02-16T09:15:00.003-05:00

The Network for Business Sustainability has prepared a list of the Top 10 CSR Research Findings in 2010 related to Corporate Social Responsibility (CSR). Taken from top management journals, these research insights help senior leaders to kick-start their sustainability planning for 2011. The best research findings related to CSR include: Innovation + Sustainability = Profit; Beat Burnout, Boost Performance; Promote CSR Internally to Engage Staff; Put Product Quality First, CSR Second; Get Buy-In Today for CSR Projects Tomorrow; Prioritize Your CSR Activities; Understand How CSR Drives Performance; Revisit Your Reputation; Do Right by Your Stakeholders; and Use Standardized Metrics for Carbon.

Global Survey Findings on Accounting for Sustainability Practices

2011-02-11T09:06:00.017-05:00

The Chartered Institute of Management Accountants (CIMA), the American Institute of Certified Public Accountants (AICPA), and the Canadian Institute of Chartered Accountants (CICA) have published a survey measuring the state of accounting for sustainability in the UK and North America. It shows that compliance with regulatory requirements remains the most common driver of business sustainability (34% of large companies and 24% of small companies). In addition, 32% of large companies said managing reputation risk is a key driver while 19% of small companies identified cost-cutting efficiency. Also, 79% of large companies have a formal sustainability strategy, compared to 33% of small companies. The survey, called Evolution of corporate sustainability practices: Perspectives from the UK, US and Canada, is available online.

CICA/RBC Business Monitor Report (Q4 2010)

2011-02-09T09:05:00.016-05:00

The quarterly CICA/RBC Business Monitor indicates that optimism about the Canadian economy among executive Chartered Accountants has stabilized and, like the previous quarter, respondents are much more likely to be optimistic about their own businesses (41% are optimistic about the Canadian economy over the next 12 months and 56% are optimistic about how their company will perform over the next 12 months). The Q4 2010 CICA/RBC Business Monitor webinar will take place on February 23, 2011 at 12:30pm (register online). RBC Assistant Chief Economist Dawn Desjardins will give an economic update and answer questions following the webinar. (Read the CICA Media Release.)

Canada’s CAs recommend three paths to red tape reduction

2011-02-07T09:09:00.002-05:00

Eliminating, simplifying and automating regulatory processes are three paths identified by the Canadian Institute of Chartered Accountants (CICA) to reduce red tape at the federal level. The CICA recently participated in a Toronto roundtable discussion organized by the federal Red Tape Reduction Commission. The Commission asked participants to identify red tape irritants that hinder business growth in Canada. Read the CICA Media Release.

Integrated Reporting – Understanding the requirements

2011-02-02T17:05:00.000-05:00

KPMG (South Africa) has published a short guidance booklet on Integrated Reporting – Understanding the requirements. It states that "the trend in sustainability reporting has evolved from a corporate responsibility or ethical perspective to one of long-term risk management and value creation. The core concepts revolve around an inclusive approach and integrated reporting to provide a holistic and forward-looking picture of the reporting organization to the multitude of stakeholders who are impacted by and who in turn impact the reporting organization." The guidance includes an “Integrated Reporting Road Map” that contains four phases and 11 steps to consider.

Keeping your head above water… Recent issues in financial reporting

2011-02-01T09:00:00.000-05:00

PricewaterhouseCoopers (PwC) Canada has published its latest Financial Reporting Release dated January 2011. The publication is called Keeping your head above water… Recent issues in financial reporting. Topics covered include: Transitioning to IFRS; Rate-regulated Accounting; Investment Companies; Recent IFRS Developments Affecting Transition; Debt Covenants under IFRS; Global GAAP Convergence; Financial Instruments; Hedge Accounting; and Life after Convergence. (To download previous editions of this publication, visit the PwC Canada website.)

Framework for Integrated Reporting and the Integrated Report

2011-01-31T09:06:00.001-05:00

The Integrated Reporting Committee (IRC) of South Africa has recently released a Discussion Paper on the Framework for Integrated Reporting and the Integrated Report (January 25, 2011). The Paper notes that “integrated reporting is a journey. Organizations are unlikely to achieve perfection in the first year. However, as reporting processes for the production of the supporting information are designed and improved and as the executive team begins to benefit from a more informed implementation of the governing structure’s decisions, reporting will improve. Interactive communication with key stakeholders is fundamental to the success of integrated reporting as engagement leads to knowledge of the stakeholders’ legitimate interests and expectations.” Public comments are requested no later than April 25, 2011 (ircomments@saica.co.za). To learn more, read the IRC Media Release.

International Integrated Reporting Committee (IIRC) Newsletter

2011-01-28T10:55:00.000-05:00

The International Integrated Reporting Committee (IIRC) is in the process of creating a globally accepted Integrated Reporting framework. A Discussion Paper and five regional roundtables are the first steps on the road to presenting proposals for the framework at the time of the G20 meeting in November 2011. Read more in the IIRC newsletter and subscribe online.

Quarter-end financial communications guidance provided by Canada’s CAs and CIRI

2011-01-26T11:19:00.000-05:00

The Canadian Institute of Chartered Accountants (CICA) and the Canadian Investor Relations Institute (CIRI) have teamed up to produce a new publication entitled Quarter-End Financial Communications - Content to Consider, that offers some brief observations to assist management in preparing its summarized financial communications. (Read the CICA Press Release.)