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SOCPA Projects

SOCPA Project for Transition to International Accounting Auditing Standards

 
Introduction:
 
The certified public accountants' regulation, issued under royal decree No.M/12 dated 13.05.1412h, entrusted SOCPA to review, develop and approve accounting & auditing standards. Up to date SOCPA issued 22 accounting standards, 15 auditing standards and various accounting and auditing interpretations and professional opinions. In preparation of  these standards SOCPA followed a firm approach which took in consideration such procedures as those followed in preparation of  USA, UK and international standards. Furthermore SOCPA requires,  in case there is an issue that no standard have been issued thereof  by SOCPA, the international standards shall be followed in this respect. It is significant to mention that SOCPA standards issued recently are in compliance to a great extent with corresponding international standards.
 
In the presence of the business world and global acceptance of the international standards as a set of high quality, SOCPA prepared a strategic plan aiming to assess and review professional standards issued by SOCPA, in the light of the international development. Consequently, SOCPA  prepares a study to find out whether it can adopt IASB and IAASB standards and therefore issue an articulated policy with respect to relations between Saudi and International standards. It is worthy to note, as provided in the IASB website, that Saudi Arabia is the only country of the group of twenty that did not adopted or have a road map to apply the international standards in future.
 
To implement the strategic plan and respond to the call of the group of twenty for improving financial reports through adoption of one set of high quality accounting standards, SOCPA technical committee studied whether it can transit to the international standards and as a result of that study concluded that Saudi standards should be converged with International standards following a trend that takes in consideration Saudi environment elements such as Shariah rules, prevailing regulations, or level of technical preparedness, .. etc .
 
As a result of the above SOCPA board formed a steering committee that comprises representatives of the ministry of  finance, SAMA and Saudi stock exchange, in addition to the representatives of SOCPA accounting and auditing standards committees. The steering committee was requested to  submit its recommendation for approval of the board with respect to convergence of Saudi standards with the international standards.
 
The steering committee held various meetings to study the convergence matter and looked into studies prepared, in regard, by SOCPA accounting and auditing committees. These studies disclosed that most countries of  the world has adopted or planed to adopt the international standards. The studies also pointed out advantages and disadvantages for choosing convergence and that the advantages outweigh disadvantages as the latter is related only to preparedness. The committee looked also into decisions taken by the accounting and auditing committees, which included a recommendation to follow a stage–wise approach for convergence with international accounting and auditing standards.
 
After careful deliberation, the steering committee decided, with the  very large majority of its members, on the plan to transit to the international standards. The steering committee, however, emphasized that SOCPA should follow in such transition an elaborated plan that takes into consideration environmental factors and economic conditions in Saudi Arabia, and that transition should be applied  gradually to allow sufficient time to all stakeholders to get themselves professionally and technically ready for smoother transition, and in order to achieve best results and consequently realization of high quality financial reports.
 
The project was approved by SOCPA board during its tenth meeting of  the sixth session, held  on 26.03.1433H (18.02.2012) chaired by H.E Dr. Tawfig bin Fawzan Alrabiah, Minister of Commerce and Industry.
 
Due process:
 
Although international standards are of high quality, however it should be noted that, they are prepared to be applied in an advanced financial and professional environment where appliers can easily find  appropriate application elements such as relevant information needed to apply fair value, beside availability of professional experts able to deal with application difficulties and problems, particularly for the reason that international standards are built on principles which requires the financial statement preparers to take  various professional judgments, a matter that needs high professional experience.
 
Furthermore, these standards provide more than one optional treatment. Therefore the approving authority in each country should select the option that suits its conditions. Hence, success of transition to international standards depends on consideration of the environment conditions where it will be applied, variance of economic sectors with respect to their ability to understand the requirements of those standards and availability of qualified persons able to respond to such requirements. For example, Saudi banks may be able, at present, to apply international standards, however other sectors may need time to train their employees in order to be able apply international standards altogether. Therefore , it is not suitable to force such sectors to apply international standards before being ready for such implementation.
 
The implementation of the transition plan requires an appropriate approach including study of  international standards, looking into the application stages and to decide whether any changes are needed on the international standards , or on the current rules and regulations. The following procedures shall be applied on each of the international accounting and auditing standards :
 
  1. The technical committee (Accounting standards committee and Auditing standards committee) shall study the international standard and related interpretations to find out whether it can be applied as it is or it should be amended to be in line with local rules and regulations, taking in consideration level of technical and professional preparedness in the kingdom.
  2. Organizing  roundtable meetings including financial statements preparers and users, academics and representatives of supervision bodies, to discuss the standard deliberately.
  3. The technical committee shall discuss comments made during the roundtable meetings, in order to make any necessary additions or changes that may enhance the standard or its application in the kingdom.
  4. Publication of the technical committees' recommendations to in order get comments by the public, if any.
  5. Discuss comments made by the public and make necessary amendments for the standard to be approved for application in the kingdom.
 
Committees' decisions related to the approval of standards, shall be integrated in an appendix with each standards, including the text of paragraphs added or amended and reference to cancelled paragraphs beside basis of conclusions and reference to paragraph effected by the amendments.
The official translation of the international standards, particularly that of accounting and auditing terminologies, shall be reviewed to find out whether it needs amendment or full translation is to be made upon mutual agreement with the relevant international boards.
 
Entities to which converged standards with international standards would be applied
Keeping in view the complex nature of international standards, SOCPA will follow the international trend in developing two sets of accounting standards, the first one represents converged standards applied to publicly accountable entities ( such as listed companies), while the second set, representing topics covered by accounting standards for small and medium size entities (SMEs), shall be applied to other entities.
 
 
 
Stages of transition to international standards
 
To achieve best results SOCPA decided to issue converged standards in phases according to certain priorities including categorization of standards into groups of correlated topics. To avoid any confusion on application SOCPA will start with international standards which are not expected  to undergo major amendments in the near future, taking in consideration the priority based on the current need of the converged standards.
 
Follow – up of new standards and updates in the current standards and making necessary amendments
 
Transition to IFRSs and IAASB standards, requires SOCPA to  follow – up any new standards and updates issued by IASB & IAASB in order to be aware of modifications that may arise on the converged standards . SOCPA should follow the same due process as being applied at the time of issuing converged standards..
 
Accounting and auditing for Shariah compliance transactions :
 
Considering Saudi Arabia as a leading Islamic country it is pertinent for SOCPA to have an influential role in providing accounting and auditing standards and application guidance needed for Shariah compliance transactions, as  such publications may not be covered by the international standards.
 
SOCPA'S future role:
 
The  transaction decision requires SOCPA to have active role in influencing international standards before being issued. This role shall be played by sending comments on various discussions papers, exposure draft of international standards, suggesting subjected for new standards and otherwise participations in IASB and IAASB activities.
 
SOCPA shall continue in serving interested parties with respect to issuance of application guidance when  needed and in issuing professional standards and opinions for any topics not covered by the international standards.
 
Action plan of transition to international standards
 
Stages of transition to international standards :-
According to  decisions taken by SOCPA technical committees with respect to transition to international standards, convergence will be completed within five years in accordance with the above mentioned stage-wise approach. Standards shall be addressed in correlated groups according to an appropriate time table as follow:-
 
First: accounting standards and opinions issued by IASB :-
Groups Subjects Year of review
Group 1 Presentation of financial statements  
  IAS 1 Presentation of Financial Statements 1
  IAS 7 Statement of Cash Flows 1
  IAS 8 Accounting Policies, Changes in Accounting Estimates and Errors 1
  IAS 10 Events After the Reporting Period 1
  IAS 24 Related Party Disclosures 1
  IAS 33 Earnings Per Share 1
  IAS 34 Interim Financial Reporting 1
  IFRIC 10 - Interim Financial Reporting and Impairment 1
  IFRS 8 Operating Segments 1
  IFRIC 17 - Distributions of Non-cash Assets 1
Group 2 Employee benefits  
  IAS 19 Employee Benefits 2
  IAS 26 Accounting and Reporting by Retirement Benefit Plans 2
  IFRS 2 Share-based Payment 2
  IFRIC 14 - IAS 19 – The Limit on a Defined Benefit Asset, Minimum Funding Requirements and their Interaction 2
Group 3 Non current assets - I  
  IAS 2 Inventories 2
  IAS 16 Property, Plant and Equipment 2
  IAS 23 Borrowing Costs 2
  IAS 38 Intangible Assets 2
  SIC 32 - Intangible Assets-Web Site Costs 2
Group 4 Group accounts  
  IAS 27 Separate Financial Statements (revised) 2
  IAS 28 Investments in Associates (revised) 2
  IFRS 10 Consolidated Financial Statements 2
  IFRS 11 Joint Arrangements 2
  IFRS 12 Disclosure of Interests in Other Entities 2
  IFRS 3 Business Combinations 2
Group 5 Non current assets - II  
  IAS 40 Investment Property 3
  IAS 36 Impairment of Assets 3
  IAS 41 Agriculture 3
  IFRS 5 Non-current Assets Held for Sale and Discontinued Operations 3
  IFRS 13 Fair Value Measurement 3
Group 6 Revenue recognition  
  IAS 11 Construction Contracts 3
  IAS 18 Revenue 3
  IAS 20 Accounting for Government Grants and Disclosure of Government Assistance 3
  IFRIC 13 - Customer Loyalty Programs 3
  IFRIC 15 - Agreements for the Construction of Real Estate 3
  IFRIC 18 - Transfers of Assets from Customers 3
  SIC 10 - Government Assistance-No Specific Relation to Operating Activities 3
  SIC 31 - Revenue-Barter Transactions Involving Advertising Services 3
Group 7 Leasing  
  IAS 17 Leases 4
  IFRIC 4 - Determining whether an Arrangement contains a Lease 4
  IFRIC 12 - Service Concession Arrangements 4
  SIC 15 - Operating Leases-Incentives 4
  SIC 27 - Evaluating the Substance of Transactions Involving the Legal Form of a Lease 4
  SIC 29 - Disclosure-Service Concession Arrangements
 
 
4
Group 8 Financial Instruments  
  IAS 32 Financial Instruments: Presentation 4
  IFRS 7 Financial Instruments: Disclosures 4
  IFRS 9 Financial Instruments 4
  IFRIC 2 - Members’ Shares in Co-operative Entities and Similar Instruments 4
  IFRIC 19 - Extinguishing Financial Liabilities with Equity Instruments 4
  IFRIC 16 - Hedges of a Net Investment in a Foreign Operation 4
Group 9 Foreign Currency  
  IAS 21 The Effects of Changes in Foreign Exchange Rates 5
  IAS 29 Financial Reporting in Hyperinflationary Economies 5
  IFRIC 7 - Approach under IAS 29 Financial Reporting in Hyperinflationary Economies 5
Group 10 Income Taxes  
  IAS 12 Income Taxes 5
  SIC 25 - Income Taxes-Changes in the Tax Status of an Entity or its Shareholders 5
Group 11 Provisions  
  IAS 37 Provisions, Contingent Liabilities and Contingent Assets 5
  IFRIC 1 - Changes in Existing Decommissioning, Restoration and Similar Liabilities 5
  IFRIC 5 - Rights to Interests arising from Decommissioning, Restoration and Environmental Rehabilitation Funds 5
  IFRIC 6 - Liabilities arising from Participating in a Specific Market—Waste Electrical and Electronic Equipment 5
Group 12 Insurance  
  IFRS 4 Insurance Contracts 5
Group 13 Mineral Assets  
  IFRS 6 Exploration for and Evaluation of Mineral Assets 5
Group 14 First-time Adoption  
  IFRS 1 First-time Adoption of IFRSs 5

 

 
 
Second: International Standards on Auditing, Attestation, and other Services:
                                  
Groups Subjects Year of review
Group 1 GENERAL PRINCIPLES AND RESPONSIBILITIES  
   ISA 200, Overall Objectives of the Independent Auditor and the Conduct of an Audit 1
  ISA 210, Agreeing the Terms of Audit Engagements   1
  ISA 220, Quality Control for an Audit of Financial Statements 1
  ISA 230, Audit Documentation   1
  ISA 240, The Auditor's Responsibilities Relating to Fraud in an Audit of Financial Statements 1
  ISA 250, Consideration of Laws and Regulations in an Audit of Financial Statements   1
  ISA 260, Communication with Those Charged with Governance   1
  ISA 265, Communicating Deficiencies in Internal Control to Those Charged with Governance and Management
 
 
1
Group 2 300–499 RISK ASSESSMENT AND RESPONSE TO ASSESSED RISKS  
  ISA 300, Planning an Audit of Financial Statements 2
  ISA 315, Identifying and Assessing the Risks of Material Misstatement through Understanding   the Entity and Its Environment 2
  ISA 320, Materiality in Planning and Performing an Audit 2
  ISA 330, The Auditor’s Responses to Assessed Risks 2
  ISA 402, Audit Considerations Relating to an Entity Using a Service Organization 2
  ISA 450, Evaluation of Misstatements Identified during the Audit   2
Group 3 500–599 AUDIT EVIDENCE  
  ISA 500, Audit Evidence 3
  ISA 501, Audit Evidence—Specific Considerations for Selected Items 3
  ISA 505, External Confirmations 3
  ISA 510, Initial Audit Engagements—Opening Balances 3
  ISA 520, Analytical Procedures 3
  ISA 530, Audit Sampling 3
  ISA 540, Auditing Accounting Estimates, Including Fair Value Accounting Estimates, and Related Disclosures 3
  ISA 550, Related Parties 3
  ISA 560, Subsequent Events 3
  ISA 570, Going Concern 3
  ISA 580, Written Representations 3
Group 4 600–699 USING THEWORK OF OTHERS  
  ISA 600, Special Considerations—Audits of Group Financial Statements (Including the Work of Component Auditors) 4
  ISA 610, Using the Work of Internal Auditors 4
  ISA 620, Using the Work of an Auditor’s Expert 4
Group 5 700–799 AUDIT CONCLUSIONS AND REPORTING  
  ISA 700, Forming an Opinion and Reporting on Financial Statements 4
  ISA 705, Modifications to the Opinion in the Independent Auditor’s Report. 4
  ISA 706, Emphasis of Matter Paragraphs and Other Matter Paragraphs in the Independent Auditor’s Report Independent Auditor’s Report  
  ISA 710, Comparative Information—Corresponding Figures and Comparative Financial Statements 4
  ISA 720, The Auditor’s Responsibilities Relating to Other Information in Documents Containing Audited Financial Statements 4
Group 6 800–899 SPECIALIZED AREAS  
  ISA 800, Special Considerations—Audits of Financial Statements Prepared in Accordance with Special Purpose Frameworks 5
  ISA 805, Special Considerations—Audits of Single Financial Statements and Specific Elements, Accounts or Items of a Financial Statement 5
  ISA 810, Engagements to Report on Summary Financial Statements 5
Group 7 INTERNATIONAL STANDARDS ON QUALITY CONTROL (ISQCs)  
  International Standard on Quality Control (ISQC) 1, Quality Controls for Firms that Perform Audits and Reviews of Financial Statements, and Other Assurance and Related Services Engagements 5
Group 8 2000–2699 International Standards on Review Engagements (ISREs)  
  2400 Engagements to Review Financial Statements 5
  2410 Review of Interim Financial Information Performed by the Independent Auditor of the Entity 5
Group 9 3000–3699 International Standards on Assurance Engagements (ISAEs)  
  3000 Assurance Engagements Other than Audits or Reviews of Historical Financial Information 5
  3400 The Examination of Prospective Financial Information 5
  3402 Assurance Reports on Controls at a Service Organization 5
Group 10 4000–4699 International Standards on Related Services (ISRSs)  
  4400 Engagements to Perform Agreed-Upon Procedures Regarding Financial Information 5
  4410 Engagements to Compile Financial Information 5
Group 11 1000–1100 International Auditing Practice Statements (IAPSs)  
  1000 Inter-Bank Confirmation Procedures 6
  1004 The Relationship Between Banking Supervisors and Banks’ External Auditors 6
  1006 Audits of the Financial Statements of Banks  6
  1010 The Consideration of Environmental Matters in the Audit of Financial Statements 6
  1012 Auditing Derivative Financial Instruments 6
  1013 Electronic Commerce—Effect on the Audit of Financial Statements 6
 
 
 
 Preparation For the Project:
 
SOCPA shall conduct the project according to an articulated road map including a comprehensive study and the participation of all stakeholders.  Major actions taken in this respect are :
1.     preparation of scientific studies about transition to international standards including the experiences of various countries, advantages and disadvantages of transition to international standards.
2.      Holding various meetings of technical committees to study the subject and conclude to recommendations that serve the national objectives and achieve the optimum benefits of transition to international standards.
3.     Prepare a questionnaire for international accounting standards and another one for international  auditing standards, in order to obtain and understand opinions of interested parties with respect to :-
a.     Availability of expertise in international standards.
b.     Extent of complexity in each standard and considerations that should be taken with respect to Islamic rules, regulations or technical aspects.
c.     Identification of appropriate date for application in Saudi Arabia.  
4.     Sending letters to all concerned sectors including urging them to participate in the operation of transition by providing consultants to work with SOCPA.
5.      Publication of information about the project in SOCPA website and local press, and seeking the participation of interested parties to provide their opinions to SOCPA and their consultation services to the project.
 
Scope of work of consultants working on standards to provide recommendations about transition to international standards 
 
SOCPA seeks to achieve participation of accounting and auditing experts in the operation of transition to international standards. Their scope of work is defined as follow :-
1-     scope of work :-
 
1-     Study the intended international standard provided in English and Arabic languages in order to point out local considerations that may influence current requirements of the standard such as Shariah requirements, regulatory requirements technical and professional preparedness for application in the kingdom.
2-       Discussion of considerations mentioned in (1) with regulatory  authorities and other stakeholders through questionnaires, interviews and other methods of communications.
3-     Study standards and opinions, if any, issued by SOCPA corresponding  to that  international standard, in order to find out any differences from the requirements of the international standard or any treatments, if any, not covered by the international standard, and to propose adding to the international standards, amend or revoke it.
4-     Identify proposed amendments (additions, revocations or modifications) , if any, that  should be integrated in the international standard in order to facilitate its application in the kingdom, together with sufficient explanation of the reasons for the amendments and a note to the references used in reaching such amendments.
5-     (With respect to accounting standards) : Apply proposed amendments on the SMEs topic covered by the SMEs international standard.
      (With respect to auditing standards): consider IAASB guidance related to considerations that should be taken on auditing SMEs.
6-     Participation in standards setting due process and its requirement for the participation of the consultant in meetings and discussions related to the standard from starting to approval.
7-     Providing opinion on the Arabic translation approved for the international standard with respect to :-
a.        Giving a recommendation either for keeping same terminologies provided in the standard or proposing other terms.
b.       Giving a  recommendation either for keeping same text of paragraphs or re-write in another form.
 
2-     Consultation work output : 
 
During his study the consultant may conclude that the international standard can be appropriately applied in the kingdom  without being subject to any change. In this  case consultants shall provide appropriate justifications (e.g., similarity of treatments provided in the international standard or opinion with those of corresponding Saudi standard, application of the standard in countries of environment similar to that of Saudi Arabia without facing any problems, studies showing enhancement of the quality of financial reports on applying the international standard or interpretation in a countries of similar environment, field studies conducted in the Kingdom or in other countries of similar environment confirming the possibility of application without making any changes in the international standard or interpretation). Results of a field survey covering opinions of a sample of interested parties in the Kingdom shall be considered, in this regard, as an accepted proof. The consultant shall submit his opinion in a form of report addressed to the executive committee.
 
 
In case that, the consultant proposes amendments (additions, revocations or modification) on the international standard or interpretation, he should provide basis of justifications including, e.g scientific studies or international comparisons confirming the need for the proposed amendments in the Kingdom environment or in other similar environments. Result of a field survey covering opinions of a sample of interested parties in the Kingdom, shall be considered, in this regard, as an accepted proof. The consultant shall submit his proposals in a form of report that can annexed to the international standard or interpretation (and similar report for the SMEs topic) including any modifications (if any), together with a proposed text for added or amended paragraphs and a clear reference to revoked paragraphs, beside sufficient explanation to the basis of conclusions reached and accurate references to paragraphs influenced by the amendment.
 
Financial aspects of the project :
 
Costs of project include direct costs related to study and preparation of standards and indirect costs related to management of the project. Direct costs represents technical, Shariah and regulatory consultants remunerations, and costs of public discussions, meetings, translation, preparations and publication. Indirect costs represents costs of project management and other supporting works. SOCPA prepared a budget for the project which will be completed within five years.
 
Post–completion costs include costs of training, consultations provided to reports preparers, cost related to reconstruction of SOCPA fellowship examination material, and other costs. Other significant continuous post–completion costs are those related to follow–up of new publications and updating of standards, as SOCPA should, in the first place, follow these publications in order to consider its approval in the kingdom. Furthermore, SOCPA seeks to participate in the activities of the international boards, submitting comments on the proposed international exposure drafts, participate in international meeting and host experts in relevant fields.
           

Accounting Standards Project for non-profitable organizations

 
Accounting is considered one of the important tools that help to control business establishments of various types and helps those responsible for it to take the right decisions to ensure the continuation of these establishments and their contribution to the strengthening and consolidating of the national economy, and therefore the Ministry of Commerce prepared an extensive study to develop accounting and auditing professions by issuance of the Royal Decree No. M / 12 dated on 05/13/1412 AH which resulted in approving the Chartered Accountants law which states its Article no. 19 the establishment of the Saudi Organization for Certified Public Accountants; which is an organization operated under the supervision of the Ministry of Commerce to promote accounting and auditing professions. Paragraph (1) of Article (19) of the Chartered Accountants law that one of the purposes of the organization is to review, develop and adopt accounting standards.
 
In light of the aforementioned, the board of the organization decided to form the committee (Accounting Standards Committee) that is responsible for preparing and developing accounting standards that all kinds of establishments have to stick to it while preparing their statements, and to commit to accounting standards regulations approved by the decision of the board of the organization no. 1/2/3 dated on 15/05/1414 AH correspondent with 10/30/1993.
 
Given the importance of the existence of accounting standards specified for non-profitable organizations in all types is a necessity due to the large number of charities operating in the Kingdom, and the diversity of its activities, and society's need for continuity of such entities to do their work in the community requires appropriate disclosure of its activities and the results of their work on a regular basis; to continue to perform its vital mission in the community. Therefore, the presence of accounting standards that govern the financial disclosure for these entities contributes to the provision of appropriate information that can be relied upon, which helps to direct the financial resources to those most beneficial to the community in a more effective way; compared to other standards of other non-profitable organizations. The failure to pursue profits in these entities does not diminish the importance of having the necessary accounting foundations, rules and procedures to prove the financial information, recorded, summarize and report them. From this standpoint; the Saudi Organization for Certified Public Accountants, with the generous support of Sulaiman bin Abdulaziz Al Rajhi Charity, prepared a draft for accounting standards for non-profitable organizations, to initially develop a theoretical framework that sets targets of the financial statements for non-profitable organizations, making all business analysis and comparisons of the best accounting practices, studying the practical reality of these entities, and make out the best appropriate accounting practices to the Kingdom. The project included a review of the accounting standards related to non-profitable organizations around the world, as well as statutory frameworks governing those entities operating in the Kingdom, and then prepare a draft of the objectives and concepts of financial statements for non-profitable organizations, as well as a draft for standard of presentation and disclosure of financial statements of the non-profitable organizations, and finally a draft for donations standards. Current accounting practices for non-profitable organizations are based in most directions on accounting standards issued for profitable entities; because of similarity (not uniformity) made in the nature of economic events that these entities are subject to. In addition, pending the issuance of the directive; non-profitable organizations have the right to continue to apply what deems to be appropriate considering accounting practices specified for profitable organizations, as long as those financial reports of these entities show the fact of their current economic situation. The committee has discussed the draft of the standards and the attached study during several meetings. The advisor redrafted the draft of the standards and the study in the light of the observations made. After adoption by the Committee, it shall be sent whom it may concern and those specialized to provide the Board with their comments. Also we discussed the draft of the standards in an open meeting attended by a number of people who are interested and specialized in the field of accounting and auditing including professionals, government officials, academics and businessmen. Also, the supervising entities in associations and charities, and the Committee has studied the reported observations and amend the draft of the standards that had been taken; and submitting it to the Board of Directors of the Organization, the board issued the resolution No. 7/2 dated on 02/11/1434 AH correspondent with 12/24/2012 to adopt accounting standards for non-profitable organizations.
Finally, we thank everyone involved in issuing these standards including accountants, academics, public and private sector employees. We also thank Sulaiman bin Abdulaziz Al Rajhi Charity to support the project financially and ask God to make this effort right, and useful for those involved in this sector.
God bless you,,, 
The Secretary-General
D. Ahmed Abdullah Moghames

 

First initiative: Modifying accountants system and proposing mechanisms for the development of chartered accountant work to increase confidence in his work


This initiative review chartered accountants’ system modify what needs to be modified in accordance with the developments in the field of this profession. This initiative also propose mechanisms to develop the work of chartered accountants to increase confidence in his work to include the following:
  • Review the title of accountants organizations
  • Visualize reward and punishment
  • Re-formation of the Commission of Inquiry
  • Reconsider the sanctions approved by the Commission of Inquiry and ensure that there is no variation of sanctions in similar cases
  • Licensing Certified chartered Accountants (who have bachelor degree in any field other than accounting).
  • A comparison of what it must be the case of accountants - assess the situation with other professional advanced organizations.
  • Shape of the professional company (joint or limited)
  • Preparing a standard contract between the auditor and the client that preserves the rights of each party (Engagement Letter)
  • Announcing the results of field investigation (Fail / Pass)
  • Ensure that the manager or supervisor of the audit process obtained a fellowship or any other degree recognized by the organization.
  • Develop procedures for the granting temporary stoppage
  • Involvement of representatives of the Capital Market Authority and the Department of Zakat and Income in the Board of Directors
  • Developing small and medium-sized offices
  • Develop a mechanism and conditions to be taken into consideration when choosing a chartered accountant
 

The second initiative: the proposal to establish a training entity (Accounting Institute)

 
  • Reviewing the proposal of the initiative by the Committee of Education and Training and proposing the best ways to implement the initiative and raise what has been reached for the board.
  • Develop a bids request brochure for the preparation of feasibility studies for project accounting institute.
  • Evaluation and appointment of the consultant to prepare feasibility studies for the project of the accounting institute.
  • Prepare a bids request brochure for proposals for the management and implementation of the draft accounting Institute.
  • Evaluation and appointment of the adviser for the preparation, management and implementation of a project of the Accounting Institute.
  • Implementation of the draft of accounting institute (the duration of the project implementation shall be known according to the previous stage).
 

The Third Initiative: the application of the accounting skills test for the private sector and state employees

 
  • Communicate with the relevant and competent authorities such as the Ministry of Civil Service to promote for this proposal.
  • Discuss the proposal with the tests committee.
  • Review and comparison of similar experiences in other countries and take advantage of what they have.
  • Preparing general rules for accounting skills test
  • Discuss the draft of the general rules for measurement tests by the board for adoption.
  • Preparation and announcement of the test and its implementation.
 

The fourth initiative: increasing the number of those qualified in the field of accounting, auditing, zakat, and tax (other professional certificates).

 
  • Identify the proposals of diplomas and professional degrees by collecting all applicable procedures globally, regionally and locally.
  • Its implementation is related to the initiative of establishment of training institute.
  • Analyzing and summarizing the information gathered considering advantages and disadvantages.
  • Approving a proposal to be submitted to the Committee of Education and Training.
  • Referring the approved proposal to be submitted to board for adoptions.
  • Resolution of the board.
 

The Fifth Initiative: Initiative of the automated system consolidated of financial statements

 

 

Phase One:
  • Form a team that contain members from the committee and the ministry to prepare a bids request brochure for the execution of the advisory study RFP1
  • Approval of bids request brochure by the team overseeing the study RFP1
  • Preparing and offering rehabilitation models and then to be evaluated to adopt qualified companies.
  • Offering the brochure for qualified offices and companies: advisory study (RFP 1)
  • Assessment, studying and approval of bids (the deadline adopted 30/01/2013)
  • Advisory Office shall implement the study and prepare a bid brochure to implement the initiative in its second phase (RFP2)
 
Second stage: Development and Implementation Stage
• Determination of the stages of the second phase and duration for the outputs and the requirements of the advisory study RFP1