The Hindu Business Line : `IFAC move to improve public confidence in financial reporting pays'

THE International Federation of Accountants (IFAC) President, Mr Graham Ward, has said that public confidence in the financial reporting process, that had taken a plunge in the wake of Enron and other corporate scandals, has "improved considerably" in recent years.

He attributed the improved public perception to IFAC's efforts including increased transparency in the auditing standard setting process and upgrading of public interest inputs in such processes.

Mr Ward, who is on his third visit to India, told newspersons that auditing firms too have, after the wake-up call for accountants in the post-Enron scenario, redoubled their focus on improving the quality of audits.

The IFAC President called on the Company Affairs Minister, Mr Prem Chand Gupta, on Monday along with IFAC's Chief Executive, Mr Ian Ball, and senior functionaries of the Institute of Chartered Accountants of India (ICAI), including its President, Mr Kamlesh Vikamsey. He is slated to meet the Reserve Bank of India Governor, Dr Y.V. Reddy, in Mumbai in the next few days.

Asked to comment on the meeting with the Minister, Mr Ward said that one of the objectives was to "confirm the Minister's support for international convergence of public sector (basically government) accounting standards."

The IFAC President said efforts were on to simplify the language used in auditing standards. He also said that IFAC, which is a worldwide organisation for the accountancy profession, is developing a tool-kit to assist its member-bodies, including the ICAI, in imparting ethical foundations to their members' actions.

"The tool-kit should be ready by the middle of this year," Mr Ward said.

The IFAC's Ethics Committee has already issued a newly revised code of ethics for professional accountants, which establishes a conceptual framework for all professional accountants to ensure compliance with the five fundamental principles of professional ethics - integrity, objectivity, professional competence and due care, confidentiality, and professional behaviour.