CPA Canada's Response to IAESB's Proposed IES Continued Professional Development (Revised)

CharteredProfessionalAccountantsofCanada

277 WellingtonStreetWestTorontoONCANADA M5V3H2

T. 416977.3222F. 416977.8585

Comptablesprofessionnels agréésduCanada

277, rueWellingtonOuestToronto(ON)CANADA M5V3H2

T. 416204.3222Téléc.416977.8585

September18,2017

Mr.DavidMcPeakPrincipal

InternationalAccountingEducationStandardsBoardInternationalFederationofAccountants

277WellingtonStreetWest,8thFloorToronto,OntarioM5V3H2

DearDavid,

RE:ExposureDraftontheproposedrevisionofIES7,ContinuingProfessionalDevelopment

IamwritingonbehalfoftheCharteredProfessionalAccountantsofCanada(CPACanada)inresponsetoyourrequesttocommentontheExposureDraftentitledProposedRevisionofIES7,ContinuingProfessionalDevelopment(“theExposureDraft”).

CPACanadaisthenationalbodyofCanada’saccountingprofession,withmorethan200,000membersbothathomeandabroad.TheCanadianCPAdesignationwascreatedwiththeunificationofthreelegacyaccountingdesignations(CA,CGA,andCMA).CPACanadaconductsresearchintocurrentbusinessissuesandsupportsthesettingofaccounting,auditingandassurancestandardsforbusiness,not-for-profitorganizationsandgovernment.Itissuesguidanceoncontrolandgovernance,publishesprofessionalliterature,developscontinuingeducationprogramsandrepresentstheCanadianCPAprofessionnationallyandinternationally.

CPACanadaacknowledgesthesignificantworkcompletedbytheIAESB(theBoard)overthepastfouryearsintherevisionofitseightInternationalEducationStandards(IES).Webelievethateducationstandardsreflectingbestpracticesfortheinitialandcontinuingprofessionaldevelopmentofourmemberscontributestoincreasedcompetencyforprofessionalaccountants,andthustoourmandatetoprotectthepublicinterest.WehavereviewedtheExposureDraftandconsultedwithkeystakeholdersandofferthefollowinggeneralcommentsfortheBoard’sconsideration.

Generally,CPACanadaissupportiveofmovingtowardamoreprinciplesbasedmethodofreportingcontinuingprofessionaldevelopment(CPD)by member bodiesand wearepleasedwiththeBoard’srecommendationtoenhancetheexplanatorymaterialincludedintherevisedstandard.Inparticular,weareinagreementwiththeproposedCPDFramework,whichprovidesthememberbodieswithaclearprocessthatcanbeusedbymemberstoassesstheirCPDrequirements.

CPACanadaalsorecognizesthatmemberbodiesarefacedwithdifferingcircumstancesandchallengeswithrespecttoimplementationofCPDrequirementsandwearepleasedthattherevisedstandardcontinuestoprovidememberbodieswiththeflexibilityinselectingbetweenoutput-based,input-basedsystemsorboth.CPACanadabelievesthat,becauseofitsflexibilityandfocusonlearningoutcomes,anoutput-basedCPDreportingsystemwouldbewelcomedbymanyprofessionalaccountants.However,wealsorecognizethechallengesofmovingtoanoutput-basedsystemandappreciatetheadditionalguidanceincludedinthereviseddraftstandard.

CPACanadaisgenerallysupportiveoftheproposedamendmentstoIES7.However,itwasnotedthroughourdiscussionswithregulatorybodiesinCanadathattheremovalofthespecific numberofhoursfortheinput-basedmodelwillprovidethememberbodieswiththediscretiontosettheirownlimits.Therewasaconcernexpressedthatthischangewouldresultininconsistentstandardsacrosstheaccountingprofession.

Specificcommentstothequestionscontainedintheexposuredraftareprovidedbelow.

Question1:IstheobjectivestatementoftheProposedIES7appropriateandclear?

CPACanadabelievestheObjectiveStatementoftheProposedIES7isclear.Wehavenofurthercommentsorconcerns.

Questions2:AretherequirementsoftheProposedIES7appropriateandclear?

CPACanadabelievestheRequirementsoftheProposedIES7areappropriateandclear.Inparticular,wesupportthechangestofocusontheaccountant’srole.

Question3:ArethereanyadditionalexplanatoryparagraphsneededtobetterexplaintherequirementsoftheproposedIES?

ParagraphA14mayrequiremoreclarificationastowhatisconsidereda“careerbreak”andsomedirection as to whenan individualisconsidered tobe “retired”.For example,isaretiredmemberanaccountantwhoisnolongerpracticinginaprofessionalcapacityorwouldanindividualwhoisotherwiseretiredbutstillundertakingworkofavolunteernatureberequiredtocompleteCPD?

Question4:Doproposedrevisionstotheoutput-basedapproachrequirementandrelatedexplanatorymaterialimproveunderstandingandyourabilitytoapplyanoutput-basedmeasurementapproach.Ifnot,whatsuggestionsdoyouhavetoimproveclarityoftheoutput-basedapproach?

CPACanadarecognizesthatanoutput-basedapproachtoCPDfocusingonlearningoutcomeswouldsupportamoreholisticviewtothedevelopmentandmaintenanceofprofessional competency whencomparedtoinput-basedmeasuresuchashoursofstructuredlearning.Additionalguidanceastohowamemberwoulddemonstratelearningoutcomesmayprovideadditionalsupporttomember

organizationsinterestedinmovingtoanoutput-basedsystem.Intheabsenceofguidance,theBoardmayalsoconsiderdevelopingbestpracticesbasedontheexperiencesofthosejurisdictionswhohavealreadymovedtoanoutput-basedmodel.

Question5:ArethereanytermswithintheProposedIES7whichrequirefurtherclarification.Ifso,pleaseexplainthenatureofthedeficiencies.

CPACanadaissatisfiedwiththetermsaspresented.

Question6:Doyouanticipate anyimpact or implications foryour organization,or organizationswithwhichyouarefamiliarinimplementingtherequirementsincludedinthisproposedIES7.

Giventherevisedstandardmaintainstheabilityforamemberbodytoselectaninputoroutput-basedmodel,thereappearstobenosignificantimpactorimplicationstotheCanadianCPAProfessionasreportingcouldcontinuewiththestatusquo.However,asstatedabove,theremovaloftherequirementforthe120hoursundertheinput-basedmethodcouldleadtomemberschallenginganyhourrequirementimplementedbyamemberbodyresultingtoanoverallloweringofthecurrentrequirements.

Question7:Whattopicsorsubjectareasshouldimplementationguidancecover?

ItwouldbehelpfuliftheBoardweretoprovideadditionalguidanceastohowverifiableandnon-verifiablelearning outcomes wouldbe measured in output-based reporting andhow a member bodyorregulatorcouldmonitoranoutput-basedsystem.

WethankyoufortheopportunitytocommentonthisExposureDraftandappreciatethatfurtherrevisionstotheseproposalsmayresultthroughthefeedbackprovidedbystakeholders.

Yourstruly,

TashiaBatstone,FCPA,FCA,MBA

SeniorVicePresident,