Transcript simone doran irish institute

The Institute of Chartered Accountants in Ireland
ABAF Annual General Meeting
24th April 2008
Simone Doran, Director on behalf of
Vincent Sheridan
President
Welcome
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Thank you for the invitation
Apology for change of face
Overview of the economies of N.Ireland and the UK
Challenges for the Profession
Global Impacts for professional bodies
ICAI
Lisbon Treaty
Irish Economy
1997
2007
GDP = EU average
1.4m at work
GDP +35%
2.1m at work (12.5%
foreign)
€1.7bn
€1bn
€160
€330m roads investment
R&D investment €220m
Child Benefit €38pm
Between 2002 and 2007 GDP growth averaged 5.3%
Irish Economy today
Economy slowing down but still strong
• GNP Growth forecasts range between 1.6% and 2.8%
• Debt/GNP ratio end 2007 was 26%
• Unemployment 4.5% (participation rate 69% - target 70%)
• CPI inflation 5%
• Falling house prices, slowing construction sector
• 6% GNP p.a. committed to National Development Plan
• National Pension Reserve Fund €21.3bn (since 2001)
Northern Ireland
• Political developments 2007 have led to new confidence.
• Record employment levels
• Overdependence on public sector and transfers from the
UK
• Executive committed to economic development
• ICAI active in Varney debate – 12.5% Corporate Tax Rate.
• Mid-April Agreement between NI Executive and Irish
Government on IFSC sub-offices locating in N. Ireland. Irish
Regulator and RoI tax. Skills shortages in RoI offset.
UK Economy – short-term indicators
• GDP rose by 0.6% in Q4 2007, 2.8% higher than Q4
2006
• Debt as percentage of GDP – 36.7% end March
• Employment rate – 74.9%
• 29.51m at work end Feb., highest since 1971
• CPI at end March, 2.5%
Three major UK economic events
• Northern Rock crisis – Bank of England provided
guarantees to
stabilise the situation
safeguard depositors
protect the system
• February – legislation introduced to take Northern
Rock into a temporary period of public ownership
• Special Liquidity Scheme, introduced this week.
The Profession – Challenges
 Regulatory environment
 IAASA – established 2006
 ODCE – established 2002
 Financial Regulator and FSA
 Professional Oversight Board
 Business Regulators – Energy, Communications, Transport, Health
& Safety Authority, National Employment Rights Authority, Data
Commissioner, etc.
 Ombudsmen – FS, Public Services, etc.
500 state agencies, boards, authorities and quangos in Ireland
(Fine Gael)
 Chartered Accountants Regulatory Board
CARB - unique
• Chartered Accountants Regulatory Board, est. 2007.
• Chaired by former Financial Regulator,
Dr. Liam O’Reilly
• More than 50% of Board members are nonaccountants
• Oversight of Chartered profession in Ireland
• Funded by but operationally independent, of ICAI.
• Responsible for regulation, quality assurance and
disciplinary processes.
• €4.5m budget
The Profession - Challenges
• Regulation of the Term Accountant
 ICAI secured Ministerial support for regulation of the
term “Accountant” in Ireland.
 Precise recommendation awaited in CLRG Report
(May/June 2008)
CCAB campaign UK, under discussion, less progress.
• ICAI Student intake grown from under 1,000 to 1,700+
over last 4 years
 All accountancy bodies in Ireland growing
 Demand still intensive, despite “slowdown”
The Profession - challenges
• 8th Statutory audit directive – many aspects already in UK via FRC
and in Republic via IAASA, but transposition awaited in RoI.
• McCreevy Audit package
 recommendation on auditor liability
 public consultation on ownership of audit firms
 recommendation on quality assurance of audits of listed companies
• Auditor Liability, current situation
 can be agreed by contract in UK
 No LLPs in RoI
 auditors not allowed incorporate.
 RoI awaiting CLRG report, but hopeful of positive outcome.
The Profession - Challenges
• New Anti-Money Laundering Guidelines arising from 3rd
AML Directive in place in the UK, awaiting implementation
in RoI.
• New Companies Act UK in place.
• Consolidated Companies Legislation in the RoI due for
publication later 2008 by CLRG.
• IFRS simplification – standard for SMEs, supported by
ICAI
• EU simplification proposals ¯ exemptions for small
companies from filing financial information and
establishment of micro-entities. Genuine debate yet to take
place in UK or RoI.
Globalisation and the Profession
Ernst & Young
 proposed merger of European and Asian firms
 implications for professional bodies?
Existing international co-operation:
 Common Content Initiative (7 Institutes)
 FEE
 IFAC – ICAI chairs Education & Ethics. Boards
member of PIAB.
 Global Accounting Alliance – 9 institutes
 XBRL
ICAI Profile
•16,691members at 31st Dec. 2007.
11,149 RoI
66%
3,972 UK and NI
24%
267 in Europe
2%
1,303 rest of world
8%
• Business Members
60%
• Gender 69% male
• Student recruitment profile, 53% female (trend over last ten years)
• 68% membership aged under 44
ICAI Financials
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Reserves now stand at €16m
Sub increases 2% for 2008
New leased training centre & office in Belfast
€50m training centre & office being developed
in Dublin
• Healthy Financial position
Latest ICAI Headline Activities
Publishing – Commenced 2006
• 35 publications by June 2008
• Provide technical information to members & general information to a wider
audience.
• Enhance CA Brand
• Raise profile of ICAI & its members
Lifelong Learning
• 13 post ACA qualifications with 6 already launched
• Use of technology – eCPD, Harvard ManageMentor Plus, Nelson Croom.
• My CPD
Website
• New interactive website to be launched end May.
Tax Services
• Unique on-line consolidated Irish taxation resource
Lisbon Treaty
Ireland only country consulting its electorate
• Irish referendum on Lisbon Treaty not confirmed but
believed to be 12th June.
• ICAI Council in March agreed to support the yes
campaign.
• Key concern – CCCTB
• Treaty confirms national veto in the area of tax.
• Some countries could decide to adopt CCCTB but cannot
force it on others.
• Thank you very much