News from the profession

A summary of current CICA projects and initiatives

CICA introduces CAS Support Tool

The Canadian Institute of Chartered Accountants has developed an interactive, online tool to assist auditors with a smooth transition to the new Canadian auditing standards (CAS). The CAS Support Tool provides a single point of entry to a wealth of useful information to help auditors familiarize themselves with the new standards.

The tool provides information for all four phases of the audit process:

Relevant standards for each phase are identified along with comparative information outlining differences in scope, new concepts and requirement changes as compared to existing Canadian generally accepted auditing standards (GAAS) for audits of financial statements. Users can conveniently link to a page of sample audit reports, related articles and training opportunities, including free webinars.

“This tool is designed to help make the transition as smooth as possible for audit practitioners,” says Gord Beal, CA, who leads the CICA’s Canadian Standards in Transition project. “Auditors and students of auditing will find the tool well organized and user-friendly.”

The suite of 36 CAS, which fundamentally mirrors the requirements of the international standards on auditing, are effective in Canada for periods ending on or after December 14, 2010. CAS apply to audits of financial statements for all types of organizations, including large and small companies, public and private companies across all industries, not-for-profit organizations, and government.

CAS are principles-based and many of the new standards are consistent with current Canadian auditing practice. Some, however, represent significant change and auditors must prepare accordingly.

The amount of work the transition will require depends largely on whether practitioners are currently performing truly risk-based audits. The CAS are focused on requiring auditors to plan, perform and report their audits using a risk-based approach. Public accounting firms that fully implemented the risk-based standards that were issued in 2006 are likely to find the transition much more straightforward than those firms that have not fully implemented the existing standards.

CAS provide high-quality standards and guidance for conducting audits in today’s complex environment. They enhance comparability with the more than 100 countries adopting international auditing standards and facilitate the performance of audits that cross international borders. They were created using the Clarity format, which has created standards that are seen to be more understandable, clear, and capable of consistent application.

The CAS Support Tool is housed on the Canadian Auditing Standards section of the CICA Canadian Standards in Transition website (www.cica.ca/TRANSITION). The website is a useful resource for anyone looking for information, downloadable resources and educational opportunities to help in the transition to new accounting or auditing standards.

In addition to the CAS Support Tool the CAS section of the website provides free access to other relevant resources including:

CICA’s Guide to the New Canadian Auditing Standards — highlights areas of similarity and difference between the new and the existing standards
New Canadian Auditing Standards — a 20-minute video that provides a high-level overview
The New CAS: After Busy Season — What Firms Should Do Now — a free webinar
Reporting on Financial Statements under Canadian Auditing Standards — an explanatory memorandum prepared by CICA Auditing and Assurance Standards staff.

Changes to independence requirements considered

The Canadian CA profession’s Public Trust Committee created an Independence Task Force to review the independence provisions that are part of the Rules of Professional Conduct.

The review is the result of changes introduced to the international independence standards, a part of the Code of Ethics for Professional Accountants. These standards were issued last year by the International Ethics Standards Board for Accountants, part of the International Federation of Accountants.

Modifications to Canada’s standards are being considered in two phases. The first phase was the subject of an exposure draft proposing changes to the current Canadian requirements related to rotation of the engagement partner and the engagement quality control reviewer. It is suggested that these change from rotation after five years, followed by a five-year time-out period to seven and two years, respectively. Any revisions to the rotation requirements will be finalized in the summer of 2010, taking into account the comments received on exposure. Revisions will be sent to the provincial institutes/ordre with a recommendation for adoption as early as possible.

The second phase was the subject of a consultation paper proposing that independence requirements in the Rules of Professional Conduct used in Canada should closely model those in the international code of ethics. The task force identified a number of key implications to this approach and requested stakeholder feedback. It will consider the views expressed in the comments received to the consultation paper in determining the recommended approach. Proposed changes to the Rules of Professional Conduct will be exposed for public comment, with any new requirements anticipated to be approved by provincial institutes/ordre, councils and boards by the end of 2011, and subsequently voted on by
members.

To learn more, go to www.cica.ca/protectingthepublic.

SME advisers conference goes for the gold

Participants at CICA’s 2010 SME advisers conference not only will get the latest updates and insights into how to support their SME clients, they will also have the opportunity to meet Canada’s Olympic champion Alex Bilodeau.

This time, Bilodeau will be sharing the podium with his father, Serge, who is a chartered accountant and Québec FCA. Together, they will talk about Bilodeau’s triumph at the Olympics and Serge will share some of the joys and challenges of raising an Olympian while maintaining a demanding role as a partner in public practice.

The conference will also feature updates on private enterprise standards, the new Canadian auditing standards, not-for-profit standards, PEM, quality control and CaseWare. There will also be tax sessions including a comprehensive income tax update, HST update, and an address by Paul Dubé, Canada’s first taxpayers’ ombudsman.

CICA’s 2010 National Conference for SME Advisors takes place August 4 to August 6, 2010 in Ottawa.

For more information or to register, visit www.cpd.cica.ca/SMEAdvisors.

MAPP survey provides firms with benchmark compensation data

All CA firms are encouraged to take part in the latest Managing a Public Practice (MAPP) survey, conducted by the CICA and the provincial institutes/ordre. Part 2 of the survey will be launched in mid-June and will focus on firm revenues, expenses, billing practices and productivity.

The survey is part of a broader three-part survey. Firms that completed Part 1 last year received a report in January covering billing rates, compensation and benefits. In September firms will receive an invitation to complete Part 3, which covers the subject of technology used by CA firms, including hardware, software and security.

MAPP survey results are not available for free or sale to nonparticipants. Only partners and sole practitioners of CA firms that participate in the survey gain access to this valuable information. Invitations to take part in MAPP surveys are sent by e-mail to CA firm partners and sole practitioners from our research provider, iTracks. MAPP surveys are hosted on a secure site and all information entered is kept strictly confidential. Results are reported in aggregate form only.

For more information regarding the MAPP survey, or if you did not receive your invitation, please contact MAPP Survey@icao.on.ca.

2010 Bill Swirsky innovation award

Nominations are now open for the 2010 Bill Swirsky Innovation Leadership Award and you are encouraged to consider suitable candidates and nominate them by the June 30, 2010 deadline. The online nomination form is available at: www.cica.ca/innovationaward.

This annual award program, sponsored by the CICA and CaseWare, is dedicated to innovators, present and future. The Bill Swirsky Innovation Leadership Award recognizes an employee, member or volunteer of the institutes/ordre who has demonstrated innovation by leading the development of effective and sustainable projects, concepts, processes or procedures with outcomes that have direct implications for advancing the CA profession, accounting and/or financial reporting nationally and/or internationally. The award is named after a prolific innovator and thought leader who retired in 2007 after more than 30 years at the CICA.

The winning entry will be chosen during the summer by a panel consisting of a representative of the Council of Senior Executives, the CICA president and CEO and a CaseWare representative. The winner will be presented with a $1,500 cash prize by CaseWare and a commemorative gift.