The Association of International Certified Professional Accountants (Association), the unified voice of the AICPA and the Chartered Institute of Management Accountants, has expressed serious concerns about a proposal by the Monitoring Group (MG) to alter the international audit standard-setting process.
In a consultation paper issued last November, the MG – a group of international financial institutions and regulatory bodies – set out various options “to enhance the governance, accountability and oversight of the international audit standard-setting process.”
“Although we share many of the same goals as the Monitoring Group, we have serious concerns about the Monitoring Group proposal, the Association explained in a February 9 comment letter signed by CEO Barry C. Melancon, CPA, CGMA. “The Monitoring Group proposal would create a standard-setting structure that could very likely produce standards of lesser quality and that may not receive widespread adoption.”
The Association’s letter stated that the MG proposal:
- does not articulate clearly the reasons for changing the current structure;
- does not sufficiently recognize how well the current structure works;
- risks harming the quality of standards and fails to define the “public interest”;
- does not present any cost-benefit analysis about the suggested changes and underestimates the funding necessary to implement the proposal; and
- does not identify a plan for obtaining reliable funding.
“We suggest, as the Monitoring Group continues to solicit and consider comments on possible changes to the standard-setting process, it should ensure that the standard‑setting process incorporates multi-stakeholder consensus,” Melancon wrote. “The Monitoring Group should take its time in considering potential changes to the standard-setting process, and we therefore support the Monitoring Group’s decision to undertake a second consultation before proceeding with any proposed changes.”