The Council for Accountancy and Financial Reporting, at work!
Author:
Corneliu CÂRLAN
JEL:
DOI:
Keywords:
\N
Abstract:
Interview with Maria MANOLESCU, Ph.D.\r\n\r\nThe priority for 2006 – to establish the systems and the mechanisms for supervision\r\n\r\n-Establishing the Council for Accountancy and Financial Reporting, as autonomous body, bringing together representatives from all the institutions and professional bodies interested by the quality of the financial reporting, is a consequence of the process of assuming a series of tasks which Romania should accomplish following the Report on Observance of Standards and Codes in the Accounting and Auditing area, developed by the World Bank specialists, which has been published in May 2003. This assessment identified the strengths and weakness in the regulatory area, as well as the way the profession in the accounting area are organized. These kinds of problems are frequent on the World Bank agenda which developed such kind of reports in more than 38 countries.\r\nAs far as concerns us, following that report a country action plan was developed in order to solve the weakness identified, and their accomplishment which will result in the improvement of the quality of the financial reporting, is monitored by this Council (CCRF).\r\nIts tasks are very precise established and consider as a priority the convergence of the national regulations in the accounting and auditing area.\r\nThe next immediate step is represented by the establishment of the oversight bodies. We have, as you could see, some initial mechanisms. For example, within the Chamber of Financial Auditors there is a Department for monitoring the quality control and we will have to be sure that it is well functioning. In this direction, as result of a system of tests and other procedures with a corresponding consistency, we have to be sure that it has the capacity to identify the possible inconsistencies of the monitoring system implemented by CAFR. At the same time, CECCAR organized a quality control system on a peer review basis, between members of this professional body. Here we have two bodies, with two different systems for quality control. Given these, we have to decide if it is necessary to be different. For this purpose we asked for technical assistance and we are now developing programs with World Bank support, in order to obtain the guarantee that we solved in details many of the problems within CCRF attributions. As we could see, many other countries are facing the issue of establishing the oversight mechanisms, very well adapted to the existing situation in each country. Things are not easy at all if we consider that, for the financial audit, the supervision ask for little auditors’ involvement in this process. At the same time, the people involved should be very knowledgeable in the financial audit in order to identify non conformity matters. Also, the financing issue for this oversight activity must be solved, on the one hand, and, on the other hand, the quality of staff involved in this activity, in order for the independence and the professional authority to be fully ensured.\r\nFirstly, CCRF will have to monitor, in accordance with its attributions, the educational programs for the professionals in the area, in order to be coordinated with the implementation program for the accounting regulations conforming to the European Directives, and where it is necessary, with the IFRS implementation program.\r\nOn the other hand, the Government Decision regulating the activity of this Council was changed and supplemented. To be more precise, in order to develop the National Accounting Standards two distinct departments will be created: one with attributions in developing the accounting standards for the private sector, and a similar one for the public sector.