‘Bold and broad’ inquiry reforms to restore trust in profession, says IPA
Recommendations from the consulting inquiry focused on whistleblowing, partnerships, large firms and consultants will enhance transparency and drive change across the profession, the IPA has said.
The Institute of Public Accountants says it hopes the recommendations from the consulting inquiry into large consulting and accounting firms will restore trust in the profession if implemented.
The Parliamentary Joint Committee on Corporations and Financial Services Committee tabled its final report for its inquiry into the audit, assurance and consultancy industry last week, outlining 16 priority recommendations for immediate action and 40 in total.
IPA chief executive Andrew Conway said there were numerous recommendations in the report that the IPA believes would strengthen the regulatory environment, including those relating to whistleblowing, partnerships, large firms and consultants.
"IPA believes that we must take a holistic and coordinated approach to ensure that we achieve a cohesive and robust outcome in order to restore trust and confidence and to improve accountability and governance," Conway said.
"In particular, IPA supports the expansion of the information sharing provisions to enhance transparency and collaboration between stakeholders including regulators and professional accounting bodies, and their co-regulatory function."
The IPA also strongly supported recommendation 27, which proposed legislating the term ‘accountant’, which the IPA has previously advocated for.
"This will make a significant difference to restoring trust in the profession and protecting consumers," it said.
The committee’s approach to the regulatory framework for the investigation and disciplinary functions applicable to the accounting and auditing professions was also welcomed by the professional body.
"We are also pleased that the Committee recognises the regulatory ecosystem which includes auditors, large firms, partnerships, consultants, as well as accountants," Conway said.
"There are multiple stakeholders which must work together to restore trust."
However, the IPA urged the government to ensure the reforms are proportionate, particularly for smaller accounting firms.
"We emphasise that reforms should be proportionate given that the vast majority of accountants adhere to the high professional and ethical standards which are demanded of them by the regulators, the public they serve and also their peers," Conway said.
"It is worth repeating that the egregious actions of some, or the culture of certain organisations, are a far cry from the small accounting firms and sole practitioners serving small businesses and mum and dad clients on a daily basis."
Conway noted the professional accounting bodies had all developed systems and processes and had reporting requirements to the Financial Reporting Council, the Professional Standards Councils, the Tax Practitioners Board, and the International Federation of Accountants.
"The IPA has promoted its five-point plan to members which aligns with the recommendations of the Committee and which are essential to a proportionate regulatory framework."
Conway said the recommendations are set against the reforms to the Tax Agent Services Act already underway, which would also contribute to restoring trust.
"IPA remains optimistic that bold and broad reforms will eventually restore the trust that has been lost."
