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Status of Research in SAFA Member Bodies
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Executive Summary Recognizing the importance of research as one of the core elements for the
development of any profession, South Asian Federation of Accountants (SAFA) had
commissioned a study to find out the status of Research in its member bodies. The
Institute of Cost and Management Accountants of Pakistan was assigned this task in
the SAFA Assembly held in January, 2004.
India
The Institute of Chartered Accountants of India has been a torch bearer in the area of
research. Its Standards Board, Research Committee and Auditing and Assurance
Standards Board and other Committees have issued a large number of publications
most of which are research based, in different spheres of the profession. A good
number of research studies are in hand.
The Institute of Cost and Works Accountants of India has also carried out extensive
research mainly in industrial sector. It has immensely contributed in the development
of accounting literature by framing Cost Accounting Records and Cost Audit Rules for
47 Industries in India. It has also issued a number of research publications in other
areas. A number of research projects are in process.
Pakistan
The Institute of Chartered Accountants of Pakistan (ICAP) has set up different
Committees to carry out research. It has undertaken and accomplished several research
projects. The Institute has also identified several areas to undertake research for future.
Institute of Cost and Management Accountants of Pakistan (ICMAP) has set up a
Research Department, which has undertaken and completed a number of research
studies in professional areas. ICMAP has also developed Cost Accounting Record
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Rules for various industries. The Institute has also identified several research projects
for future.
Bangladesh
The research work in the Institute of Chartered Accountants of Bangladesh is in its
initial phase. A number of research projects are under way in it, mainly directed
towards setting of Standards on Accounting (BSA) and on Auditing (BAS).
The Institute of Cost and Management Accountants of Bangladesh, has carried out
research work and has developed Cost Accounting Record Rules for few industries. It
has also issued research based publications. A number of research projects which are
in hand are in different stages of completion.
Sri Lanka
The Institute of Chartered Accountants of Sri Lanka (ICASL), has set up a Technical
Division which has developed Sri Lanka Auditing Standards. It also has launched a
new faculty on Professional Reporting. The Technical Division is also developing
statement of recommended practice for Insurance Contracts.
Nepal
The Institute of Chartered Accountants of Nepal (ICAN) does not have an independent
research department. It has, however, issued few publications on Nepal Accounting and
Auditing Standards. The Accounting & Auditing Standards Boards of the Institute
have been assigned to develop further Accounting and Auditing standards for Nepal.
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1 Introduction
1.1 Background of the Study
The accounting profession is undergoing a rapid transition. The catalystic factors to
this transition are:
(i) international financial operation and cross border investments
(ii) free-trade regime
(iii) unabated forces of globalization.
The above developments demand an international perspective of accounting profession
and pose a threat to the national as well as regional accounting perspective. The
thought of national or regional accounting information and its compatibility with
international accounting standards, demands that critical review is made to strike a
balance in controversies of national, regional and international perspective and other
issues.
To gain insight into the issues and controversies, the SAFA member bodies in their
52nd SAFA Assembly held on January 17, 2004 at Lahore, commissioned a study to
find out the status of research activities in the SAFA member bodies and to facilitate
and supplement each other research projects wherever possible.
1.2 Role of SAFA
Research is stated to be the backbone of any professional advancement. The present
scenario involves fast developments in the field of technology world over. The
accounting disciplines necessitate updating the tools and techniques in practice. To
Status of Research in SAFA Member Bodies
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meet the future challenges in the accounting profession, the professional accounting
bodies throughout the world are engaged in research work on continuous basis.
For the development of accounting profession in South Asian region, proper
understanding and cooperation among member bodies of the region was a dire need
of the time. The process was formalized with the formation of South Asian
Federation in 1984, by joint efforts of the Accounting Bodies of India, Pakistan,
Bangladesh and Sri Lanka. The Institute of Chartered Accountants of Nepal, joined
the Federation later in 1997.
Presently the Federation, a body of eight accounting institutions, is playing a vital
role in developing and strengthening the research and other professional activities of
its Member Bodies.
1.3 Objective of the Study
The SAFA has assigned the task to study the present research activities of its member
bodies, namely the Institutes of Chartered Accountants Bangladesh, India, Nepal,
Pakistan and Sri Lanka, the Institute of Cost and Management Accountants
Bangladesh, Institute of Cost and Management Accountants of Pakistan and the
Institute of Cost and Works Accountants of India to Institute of Cost & Management
Accountants of Pakistan (ICMAP) and compile a report to review the developments
made in research areas by each member body. The report is to provide an insight to
accelerate the pace of research to achieve greater harmonization of accounting
profession in the South Asian Region. The Professional Accountants of SAARC
countries can make best use of the research conducted in different areas by the
member bodies.
1.4 Scope of the Study
To describe and compile the activities undertaken by SAFA member institutions, and
to evaluate the operational mechanism established to augment such activities.
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1.5 Information Source
The study has been compiled on the basis of information collected from the following
sources:
Charter of each Institute.
Websites of the Institutes.
Information provided by each Institute.
Journals and other published materials of the member bodies available in the
library of ICMAP.
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2 The Institute of Chartered
Accountants of India (ICAI)
2.1 Management of the Institute
The Institute of Chartered Accountants of India, was established on July 1, 1949 by an
Act of Parliament, The Chartered Accountants Act, 1949 for the purpose of regulating
the profession of Chartered Accountants in India. It completed 50 years of service to
the nation on July 1, 1999. Affairs of the Institute are managed and controlled by a
Council comprising 30 members. Out of these, 24 are elected by the members of the
Institute from all over the country and 6 are nominated by the Central Government.
Besides the Central Council, there are 5 Regional Councils located at Mumbai,
Chennai, Kolkata, Kanpur and New Delhi. The Headquarter of the Institute is at New
Delhi. Duration of the Central Council constituted under the Act is three years. The
Institute has several departments for ensuring its efficient functioning.
The Executive Committee, one of the three Standing Committees of the Institute,
administers the affairs of the Institute.
Activities of the Institute are divided into four divisions:
Technical Directorate;
Board of Studies;
Continuing Professional Education Directorate;amd
The Administration.
The above divisions are headed by a Director who reports to ICAI Secretary.
The Technical Director is assisted by a Deputy Director, an Assistant Director and two
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Technical Officers. Technical Directorate assists the following Technical Committees
of the Council in the matter of development of the profession:
Accounting Standards Board
Research Committee
Expert Advisory Committee
Professional Development Committee
Board of Studies Committee
Information Technology Committee
Continuing Professional Education Committee.
The ICAI is a member of International Federation of Accountants (IFAC),
International Accounting Standards Board (IASB), Confederation of Asian & Pacific
Accountants (CAPA) and South Asian Federation of Accountants (SAFA).
2.2 Research Setup
The Institute has formed various standing and non-standing committees, which perform
functions as mandated by the Council. Primarily the research activities are undertaken
by the Technical Directorate, which supports Institute�s various committees like the
Accounting Standards Board, Research Committee, Expert Advisory Committee, etc.
The activities of other committees involve considerable research initiatives. Primary
function of the Accounting Standards Board is to evolve Accounting Standards and
provide guidance on issues arising there from. The Research Committee prepares
recommendations on generally accepted accounting principles and practices, and
undertakes research projects in the areas not covered by the functions of Institute�s
other Committees. The other Technical Committees including the Auditing and
Assurance Standards Board, Corporate and Allied Laws Committee, Fiscal Laws
Committee, Committee on Financial Markets and Investors� Protection, etc, have been
set up and doing research pursuits over years. The relatively nascent committees, also
engaged in research include the Committee on Insurance, Committee on Trade Laws
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and World Trade Organisation, Committee on Information Technology, Committee on
Internal Audit, etc. Thus they also augment the research initiatives of the Institute in
respective areas.
Each of the Committee reports to the Council on its activities. The authoritative
documents prepared by the Committees, unless the power of issuance thereof is
delegated, are issued upon approbation and under authority of the Council.
All Committees are supported by officials of different cadres. The management of the
Institute has the authority to determine the composition of the official strength of such
designation as may be considered expedient from time to time. The Research and
Technical Committees are supported by high-level officials say Directors, Additional
Directors, etc over the years. The departments are supported by Chartered Accountants
working at various levels.
2.3 Research Foundation
The Institute also promotes the ICAI-Accounting Research Foundation, incorporated
with the main objective of imparting and promoting knowledge, learning, education
and understanding and basic applied research in the areas of accounting, auditing,
capital markets, fiscal policies, etc. The ICAI- Accounting Research Foundation is a
core research body. In addition to engaging in the reputed projects on conversion of
accounts of the Municipal Corporation of Delhi (MCD) to accrual basis, the Research
Foundation is currently rendering and supporting the projects on the following
subjects:
Corporate Financial Communications: Trends and Practices of Business Groups
in India Issues in Accounting � Valuation of Intangibles Developing a Code for Governance of Non-Governmental Organisations (NGOs)
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Electronic Communication and Direct Taxation
The Foundation also proposes undertaking the following research projects: Paradigm Shift in Accounting Practices of Local Bodies and Panchayats - A
Move Towards Modern Accounting and Financial Reporting Fiscal laws Administration � Concept of Accountability Taxation of E-Commerce Business Framework for National Income Accounting Convergence of Information Technology with Corporate Governance Framework of Government Accounting System for Better Accounting,
Accountability and Disclosure Practices The Structure of Accounting Profession in India � Its future in WTO Regime Ethical Standards for Professional Accountants/Auditors � A Study of Global
Standards including Indian Standards Considerations in Deciding Accounting Policies by Listed Companies Effect of Accounting Information in Published Annual Reports on Movement in
Share Prices Extent of Compliance with Accounting Standards � A Study Issues on Accounting from Small and Medium Enterprises� Perspective Investment Decision Models of Retail and Institutional Investors � Use of
Accounting Information Current Risk Management Practices by Indian Companies Current Risk Management Practices by Banking Companies and Financial
Institutions Accounting Standards � Expectation Gap
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The ICAI- Accounting Research Foundation has the acquiescence of the Guru Gobind
Singh Indraprastha Vishwa Vidyalaya to enroll Research Fellows, which are awarded
doctoral degree (Ph.D.) by the said University.
The ICAI- Accounting Research Foundation is governed by a Board of Directors in
accordance with the Foundation�s Articles of Association. The Board of Directors of
the ICAI- Accounting Research Foundation comprises:
President and Vice President of the Institute
Secretary of the Institute
Six members of the Institute�s Central Council
Dean of the ICAI- Accounting Research Foundation
Five eminent personalities in Government, industry, academics and the
profession of accountancy, law or other related professions
2.4 Journal of the Institute
The Institute brings out a monthly Journal christened �The Chartered Accountant
Journal�, which is distributed to its members free of cost. The chartered accountancy
students and others may subscribe to the Journal.
The Chartered Accountant Journal contains technical and research articles, relevant in
professional context.
2.5 Research Projects
The list of publications including research projects issued by Accounting Standards
Board, Research Committee and Auditing & Assurance Standards Board of the
Institute is given in Appendix-A.
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2.6 Research Library
The Institute�s Central Council Library situated at the Institute�s head office at New
Delhi, is a �Nucleus Library�. It is equipped with technical and useful resources
(publications and CDs) on varied topics of professional usage and value. The Central
Council Library presently has around 50000 books. The Central Council Library itself
and the libraries of the Regional Councils are quite comprehensive in terms of the
high-value basic and advanced-level resources. These publications are useful reservoir
of knowledge for research initiatives.
Moreover, the Committees possess resources required to perform their functions and
are equipped with adequate research literature on respective subjects.
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APPENDIX-A
(A.) ICAI - List of Projects Completed and Effective at present Accounting Standards Board
1. Accounting Standards (ASs)
Sl. No. Accounting Standard (AS) Title of the Accounting Standard
1. AS 1 (issued 1979) Disclosure of Accounting Policies 2. AS 2 (Revised 1999) Valuation of Inventories 3. AS 3 (Revised 1997) Cash Flow Statements 4. AS 4 (Revised 1995) Contingencies and Events Occurring After the
Balance Sheet Date 5. AS 5 (Revised 1997) Net Profit or Loss for the Period, Prior Period Items
and Changes in Accounting Policies 6. AS 6 (Revised 1994) Depreciation Accounting 7. AS 7 (Revised 2002)) Construction Contracts 8. AS 8 (issued 1985) (withdrawn
pursuant to AS 26 becoming mandatory)
Accounting for Research and Development
9. AS 9 (issued 1985) Revenue Recognition 10. AS 10 (issued 1985) Accounting for Fixed Assets 11. AS 11 (Revised 2003) The Effects of Changes in Foreign Exchange Rates 12. AS 12 (issued 1991) Accounting for Government Grants 13. AS 13 (issued 1993) Accounting for Investments 14. AS 14 (issued 1994) Accounting for Amalgamations 15. AS 15 (issued 1995) Accounting for Retirement Benefits in the Financial
Statements of Employers 16. AS 16 (issued 2000) Borrowing Costs 17. AS 17 (issued 2000) Segment Reporting 18. AS 18 (issued 2000) Related Party Disclosures 19. AS 19 (issued 2001) Leases 20. AS 20 (issued 2001) Earnings Per Share 21. AS 21 (issued 2001) Consolidated Financial Statements 22. AS 22 (issued 2001) Accounting for Taxes on Income 23. AS 23 (issued 2001) Accounting for Investments in Associates in
Consolidated Financial Statements 24. AS 24 (issued 2002) Discontinuing Operations 25. AS 25 (issued 2002) Interim Financial Reporting 26. AS 26 (issued 2002) Intangible Assets 27. AS 27 (issued 2002) Financial Reporting of Interests in Joint Ventures 28. AS 28 (issued 2002) Impairment of Assets 29. AS 29 (issued 2003) Provisions, Contingent Liabilities and Contingent
Assets
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2. The following is the list of Accounting Standards Interpretations (ASIs) issued
till date. All are effective at present:
i. ASI 1, Substantial Period of Time (Re.: AS 16)
ii. ASI 2, Accounting for Machinery Spares (Re.: AS 2 and AS 10)
iii. ASI 3, Accounting for Taxes on Income in the situations of Tax Holiday under Sections 80-IA and 80-IB of the Income-tax Act, 1961 (Re.: AS 22)
iv. ASI 4, Losses under the head Capital Gains (Re.: AS 22)
v. ASI 5, Accounting for Taxes on Income in the situation of Tax Holiday under Sections 10A and 10B of the Income-tax Act, 1961 (Re.: AS 22)
vi. ASI 6, Accounting for Taxes on Income in the context of Section 115JB of the Income-tax Act, 1961 (Re.: AS 22)
vii. ASI 7, Disclosure of deferred tax assets and deferred tax liabilities in the balance sheet of a company (Re.: AS 22)
viii. ASI 8, Interpretation of the term �Near Future� (Re.: AS 21, AS 23 and AS 27)
ix. ASI 9, Virtual certainty supported by convincing evidence (Re.: AS 22)
x. ASI 10, Interpretation of paragraph 4(e) of AS 16 (Re.: AS 16)
xi. ASI 11, Accounting for Taxes on Income in case of an Amalgamation (Re.: AS 22)
xii. ASI 12, Applicability of AS 20 (Re.: AS 20)
xiii. ASI 13, Interpretation of paragraphs 26 and 27 of AS 18 (Re.: AS 18)
xiv. ASI 14, Disclosure of Revenue from Sales Transactions (Re.: AS 9)
xv. ASI 15, Notes to the Consolidated Financial Statements (Re.: AS 21)
xvi. ASI 16, Treatment of Proposed Dividend under AS 23 (Re.: AS 23)
xvii. ASI 17, Adjustments to the Carrying Amount of Investment arising from Changes in Equity not Included in the Statement of Profit and Loss of the Associate (Re.: AS 23)
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xviii. ASI 18, Consideration of Potential Equity Shares for Determining whether an Investee is an Associate under AS 23 (Re.: AS 23)
xix. ASI 19, Interpretation of the term �intermediaries� (Re.: AS 18)
xx. ASI 20, Disclosure of Segment Information (Re.: AS 17)
xxi. ASI 21, Non-Executive Directors on the Board � whether related parties (Re.: AS 18)
xxii. ASI 22, Treatment of Interest for determining Segment Expense (Re.: AS 17)
xxiii. ASI 23, Remuneration paid to key management personnel � whether a related party transaction (Re.: AS 18)
xxiv. ASI 24, Definition of �Control� (Re.: AS 21)
xxv. ASI 25, Exclusion of a subsidiary from consolidation (Re.: AS 21)
xxvi. ASI 26, Accounting for taxes on income in the consolidated financial statements (Re.: AS 21)
xxvii. ASI 27, Applicability of AS 25 to Interim Financial Results (Re.: AS 25)
xxviii. ASI 28, Disclosure of parent�s/venturer�s shares in post-acquisition reserves of a subsidiary/jointly controlled entity (Re.: AS 21 and AS 27)
3. Others
i. Preface to the Statements of Accounting Standards (revised 2004)
ii. Framework for the Preparation and Presentation of Financial Statements (issued 2000)
iii. Guidance Note on Terms Used in Financial Statements (issued 1983)
iv. Technical Guide on Accounting and Financial Reporting by Urban Local Bodies
(issued 2000)
v. Background Material for Seminars on AS 16, Borrowing Costs (issued 2004)
vi. Background Material for Seminars on AS 17, Segment Reporting (issued 2003)
vii. Background Material for Seminars on AS 18, Related Party Disclosures (issued 2002)
viii. Background Material for Seminars on AS 19, Leases (issued 2003)
ix. Background Material for Seminars on AS 20, Earnings Per Share (issued 2002)
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x. Background Material for Seminars on AS 21, Consolidated Financial Statements (issued 2002)
xi. Background Material for Seminars AS 22, Accounting for Taxes on Income (issued 2003)
xii. Background Material for Seminars on AS 23, Accounting for Investments in Associates in Consolidated Financial Statements (issued 2002)
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Research Committee
I. Guidance Notes on Accounting Aspects:
S. No. Title of the Guidance Note
Year of Issuance/ Revision
1. Mode of Valuation of Fixed Assets Revised 1976
2. Guarantees & Counter-Guarantees Given by Companies Revised 1976
3. Guidance Note on Treatment of Reserves Created on Revaluation of Fixed Assets
Issued 1982
4. Guidance Note on Accounting for Changing Prices Issued 1982
5. Guidance Note on Accrual Basis of Accounting Issued 1988
6. Guidance Note on Accounting for Depreciation in Companies
Issued 1989
7. Guidance Note on Some Important Issues Arising from the Amendments in Schedule XIV to the Companies Act, 1956
Issued 1994
8. Guidance Note on Availability of Revaluation Reserve for Issue of Bonus Shares
Issued 1994
9. Guidance Note on Accounting for Leases Revised 1995
10. Guidance Note on Accounting for Corporate Dividend Tax Issued 1997
11. Guidance Note on Accounting Treatment for Excise Duty Revised 2000
12. Guidance Note on Accounting for Investments in the Financial Statements of Mutual Funds
Issued 2000
13. Guidance Note on Accounting by Dot-Com Companies Issued 2001
14. Guidance Note on Accounting for Oil and Gas Producing Activities
Issued 2003
15. Guidance Note on Accounting for Securitisation Issued 2003
16. Guidance Note on Accounting for Equity Index and Equity Stock Futures and Options
Issued 2003
17. Guidance Note on Treatment of Expenditure during Construction Period
Revised 1993
18. Guidance Note on Accounting Treatment for MODVAT/CENVAT
Revised 2000
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II. Other Publications
S. No. Title of the Publication Year of Publication
1. Technical Guide on Accounting and Auditing for Chit Fund Business
2004
2. Guidelines on Internal Audit � Tours and Travel Services 2003
3. Technical Guide on Accounting and Auditing in Not-for-Profit Organisations
2003
4. Technical Guide on Accounting and Auditing in Hotel Industry
2002
5. Study on Accounting in Power Sector 2002
6. Study on Audit and Certification in Situations of Missing Records
2001
7. Computer Based Budgeting System in Sybase - A Case Study of a Heavy Engineering Organisation
1998
8. Guidelines on Internal Audit � Tyre Industry 1998
9. Guidelines on Internal Audit of Enterprises carrying on Advertising and Publicity Business
1997
10. Management Control System in Non-Profit Organisations with Special Reference to Hospitals
1996
11. Study on Share Valuation 1994
12. Guidelines on Internal Audit � Cement Industry 1994
13. Project Appraisal � Requirements of Indian Financial Institutions
1993
14. Technical Guide to Audit of Educational Institutions 1993
15. The Payment of Bonus Act 1965 � An Accountant's Study 1990
16. Guidelines on Internal Audit � Construction Industry 1987
17. Trends in Published Accounts 1985
18. Guidelines on Internal Audit � Tea Industry 1984
19. General Guidelines on Internal Auditing 1983
20. Monograph on Accounting for Agricultural Operations 1983
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21. Monograph on Accounting for Livestock 1983
22. Monograph on Accounting for Rubber Plantation 1983
23. Guidelines on Internal Audit � Jute Industry 1982
24. Accounting and Auditing Technical Guide on Textile Industry
1982
25. Accounting and Control Systems in a Shipping Company 1982
26. An Approach to Social Cost-Benefit Analysis under Indian Conditions
1981
27. Monograph on Accounting for Poultry Farming 1980
28. Technical Guide for Audit of Co-operative Societies 1979
29. Management Control Systems 1977
30. Internal Control Questionnaire 1976
31. Technical Guide for Audit � Sugar Industry 1975
32. Integrated System of Cost and Financial Accounts 1973
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B. List of Projects in Hand - Accounting Standards Board (As on September 30, 2004)
1. Exposure Draft of revised Accounting Standards issued for comments
AS 15, Employee Benefits
2. Drafts of proposed/revised Accounting Standards being finalised for
circulation among the Council Members of ICAI and specified outside bodies
(limited exposure)
Financial Instruments: Disclosure and Presentation
Financial Instruments: Recognition and Measurement
AS 10, Tangible Fixed Assets
3. New Accounting Standards under preparation
i. Share-based Payment
ii. Insurance Contracts
iii. Agriculture
iv. Disclosure in Financial Statements of Banks and Similar Financial Institutions
v. Accounting and Reporting by Retirement Benefit Plans
Besides the above, the matter relating to preparation of an Indian Accounting
Standards corresponding to International Financial Reporting Standards (IFRS)
5, Non-Current Assets Held for Sale and Discontinued Operations, is under
consideration.
4. Accounting Standards under revision
The drafts of following revised accounting standards are under consideration/
preparation:
(i) Accounting Standard (AS) 1, Presentation of Financial Statements
(ii) Accounting Standard (AS) 4, Events After the Balance Sheet Date
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(iii) Accounting Standard (AS) 5, Net Profit or Loss for the Period, Prior Period Items and Changes in Accounting Policies
(iv) Accounting Standard (AS) 9, Revenue Recognition
(v) Accounting Standard (AS) 12, Accounting for Government Grants
(vi) Accounting Standard (AS) 14, Accounting for Amalgamations
Recently, the International Accounting Standards Board (IASB) has revised
many International Accounting Standards (IASs). The Accounting Standards
Board has decided that in cases where the corresponding Indian Accounting
Standards are already under revision, the revisions made by the IASB should be
taken into consideration in the revision of those Indian Accounting Standards.
In cases, where Indian Accounting Standards are not under revision but the
corresponding IASs have been revised, the Board decided that the revisions
made by the IASB should be examined so that it could decide as to which of the
Indian Accounting Standards warrant a revision.
5. Other projects under progress
The following other projects are also in progress:
i. Revision of �Guidance Note on Terms Used in the Financial Statements�.
ii. Preparation of Accounting Standards Interpretations on certain matters relating to accounting standards
6. Sub-committee of the Accounting Standards Board on Accounting Standards
for Governmental Bodies
Following projects are under progress:
(a) Conceptual Framework for Accounting and Reporting for Governmental Bodies including Urban Local Bodies is under preparation.
(b) Technical Guide on Accounting and Financial Reporting by Urban Local Bodies is under revision.
(c) The Sub-Committee is considering formulation of Accounting
Standards for Governmental Bodies on the following subjects:
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i. Presentation of Financial Statements ii. Net Surplus or Deficit for the Period, Fundamental Errors and
Changes in Accounting Policies iii. Borrowing Costs iv. Revenue from Exchange Transactions v. Construction Contracts vi. Inventories vii. Property, Plant and Equipment viii. Related Party Disclosures ix. Accounting for Government Grants x. Accounting for Retirement Benefits in the Financial Statements
of Employers
xi. Cash Flow Statements xii. Leases xiii. Events After the Reporting Date xiv. Segment Reporting xv. Investments
xvi. The Effects of Changes in Foreign Exchange Rates
xvii. Consolidated Financial Statements and Accounting for Controlled Entities
xviii. Accounting for Investments in Associates
xix. Financial Reporting of Interests in Joint Ventures
xx. Provisions, Contingent Liabilities and Contingent Assets
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Research Committee
S.N. Project Name
I. New Projects
1. Environmental and Energy Audit
2. Guidance Note on Accounting by Schools
3. Guidance Note on Accounting for Employees Share-based Payments (ESOPs)
4. Guidance Note on Accounting for Interest Rate Futures and Options
5. Guidance Note on Accounting for Demergers
6. Guidance Note on Accounting for Investments in the Financial Statements of Venture Capital Funds
7. Guidance Note on the Preparation of Financial Statements in a situation where Going Concern Assumption is Inappropriate
8. Guide to manner of estimating future cash flows and discount rates
9. Study on Brand Valuation
10. Study on Securitisation
11. Study on Special Purpose Audit of Credit Risk Management Function in Banks
12. Study on valuation of public sector undertakings for the purpose of disinvestments
13. Technical Guide for Accounting and Audit of Surface Transport Industry (enterprises involved in carriage of goods)
14. Technical Guide for Audit of Khadi and Village Industry
15. Technical Guide on Accounting and Audit in Heavy Engineering Industry
16. Technical Guide on Accounting and Audit of Housing Finance Companies
17. Technical Guide on Accounting and Audit of IT Enabled Services
18. Technical Guide on Accounting and Audit of Mutual Funds
19. Technical Guide on Accounting and Auditing in Airlines Industry
20. Technical Guide on Accounting and Auditing in Coal Mining Industry
21. Technical Guide on Accounting and Auditing in Drugs and Pharmaceutical Industry
22. Technical Guide on Accounting and Auditing in Food Processing Industry
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23. Technical Guide on Accounting and Auditing in NBFCs
24. Technical Guide on Employees Stock Option Plans (ESOPs)
25. Frequently Asked Questions (FAQs) in respect of accounting in Not-for-Profit Organisations
26. Guidance Note on Treatment of Expenditure during Construction Period
27. Guidelines on Internal Audit � Tea Industry
28. Study on Share Valuation
29. Guidance Note on Accounting Treatment for MODVAT/CENVAT
30. The Payment of Bonus Act 1965 � An Accountant's Study
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C. Research projects planned to be undertaken in future
Research Committee
S.N. Project Name
I. New Projects
1. Guidance Note on Accounting for Loyalty Programmes
2. Guidance Note on Accounting for Value Added Tax
3. Preparation of formats of financial statements of Panchayati Raj Institutions
4. Study on Derivatives
5. Study on Insurance Survey Work
6. Technical Guide for Accounting and Audit of Courier Companies
7. Technical Guide for Accounting and Audit of Surface Transport Industry (enterprises involved in carriage of passengers)
8. Technical Guide on Accounting and Audit in Edible Oil Industry
9. Technical Guide on Accounting and Audit in Plastic Industry
10. Technical Guide on Accounting and Audit in Roads, Toll Bridges and Other Infrastructure Projects
11. Technical Guide on Accounting and Audit of Aqua Farming (including Marine Products)
12. Technical Guide on Accounting and Audit of Producers and Distributors of Films and Television Serials
13. Technical Guide on Accounting and Auditing in Automobile Industry
14. Technical Guide on Accounting and Auditing in Fertiliser Industry
15. Technical Guide to Accounting and Auditing in Newspaper Publishing Industry
16. Technical Guide on Accounting and Auditing in Paper Industry
17. Technical Guide on Accounting and Auditing in Tele-communications Industry
18. Technical Guide on Accounting and Auditing in Zinc Industry
19. Technical Guide on Accounting for Bio-tech Industry
II. Revision of the Existing Publications of the Committee
1. Accounting and Control Systems in a Shipping Company
2. An Approach to Social Cost-Benefit Analysis under Indian Conditions
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3. Integrated System of Cost & Financial Accounts
4. Internal Control Questionnaire
5. Management Control Systems
6. Project Appraisal � Requirements of Indian Financial Institutions
7. Trends in Published Accounts
8. Technical Guide for Audit of Co-operative Societies
Auditing and Assurance Standards Board
(i) Projects finalized and published
I. Statements on Auditing
1. Statement on Auditing Practices 2. Statement on the Manufacturing and Other Companies (Auditor's Report)
Order, 1988 3. Statement on the Companies (Auditor�s Report) Order, 2003 4. Statement on Qualifications in Auditor's Report 5. Statement on Payments to Auditors for Other Services 6. Preface to the Statements on Standard Auditing Practices 7. Framework for Statements on Standard Auditing Practices and Guidance
Notes on Related Services 8. Auditing and Assurance Standards (hitherto known as the Statements on
Standard Auditing Practices): i. AAS-1 Basic Principles Governing an Audit
ii. AAS-2 Objective and Scope of the Audit of Financial Statements iii. AAS-3 Documentation iv. AAS-4 Fraud and Error v. AAS 4 (Revised) The Auditor�s Responsibility to Consider Fraud and
Error in an Audit of Financial Statements vi. AAS-5 Audit Evidence
vii. AAS-6 Study and Evaluation of the Accounting System and Related Internal Controls in Connection with an Audit
viii. AAS-6 (Revised) Risk Assessments and Internal Control ix. AAS-7 Relying Upon the Work of an Internal Auditor x. AAS-8 Audit Planning
xi. AAS-9 Using the Work of an Expert xii. AAS-10 Using the Work of Another Auditor
xiii. AAS-11 Representations by Management
xiv. AAS-12 Responsibility of Joint Auditors
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xv. AAS-13 Audit Materiality xvi. AAS-14 Analytical Procedures
xvii. AAS-15 Audit Sampling xviii. AAS-16 Going Concern
xix. AAS-17 Quality Control for Audit Work xx. AAS-18 Audit of Accounting Estimates
xxi. AAS-19 Subsequent Events xxii. AAS-20 Knowledge of Business
xxiii. AAS-21 Consideration of Laws and Regulations in an Audit of Financial Statements
xxiv. AAS 22 Initial Engagements - Opening Balances xxv. AAS 23 Related Parties
xxvi. AAS 24 Audit Considerations Relating to Entities Using Service Organizations
xxvii. AAS 25 Comparatives xxviii. AAS 26 Terms of Audit Engagements
xxix. AAS 27 Communications of Audit Matters with Those Charged with Governance
xxx. AAS 28 The Auditor�s Report on Financial Statements xxxi. AAS 29 Auditing in a Computer Information Systems Environment
xxxii. AAS 30 External Confirmations xxxiii. AAS 31 Engagements to Compile Financial Information
xxxiv. AAS 32 Engagements to Perform Agreed upon Procedures regarding Financial Information
II. Guidance Notes Related to Auditing
1. Guidance Note on Audit Reports and Certificates for Special Purposes 2. Guidance Note on Accountants Report on Profit Forecasts and/or Financial
Forecasts 3. Guidance Note on Audit of Fixed Assets 4. Guidance Note on Audit of Accounts of Non-Corporate Entities (Bank
Borrowers) 5. Guidance Note on Audit of Abridged Financial Statements 6. Guidance Note on Audit Engagement Letters 7. Guidance Note on Certification of documents for Registration of Charges 8. Guidance Note on Audit of Inventories 9. Guidance Note on Audit of Investments 10. Guidance Note on Audit of Banks (Revised in March 2001) 11. Guidance Note on Audit of Debtors, Loans and Advances 12. Guidance Note on Audit of Cash and Bank balances 13. Guidance Note on Miscellaneous Expenditure Shown in Balance Sheet 14. Guidance Note on Audit of Liabilities
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15. Guidance Note on Audit Report/Certificates on Financial Information in Offer Documents
16. Guidance Note on Format of the Audit Certificate to be Issued by the Statutory Auditor on the Cash Flow Statements
17. Guidance Note on Audit of Revenue 18. Guidance Note on Guarantees & Counter-Guarantees given by Companies 19. Guidance Note on Shortfall in the Value of a Bank's Investments 20. Guidance Note on Auditing of Accounts of Liquidators 21. Guidance Note on Independence of Auditors 22. Guidance Note on Surprise Checks 23. Guidance Note on Preparation of Financial Statements on Letterheads and
Stationery of Auditors 24. Guidance Note on Auditor's Report on Revised Accounts of Companies before
Circulation to Shareholders 25. Guidance Note on Certificate to be issued by the Auditor of a Company
Pursuant to Companies (Acceptance of Deposits) Rules 1975 26. Guidance Note on the Duty Cast on the Auditors under Section 45-MA of the
Reserve Bank of India Act, 1934 27. Guidance Note on Revision/Rectification of Financial Statements 28. Guidance Note on Signature on Statutory Audit Reports 29. Guidance Note on Auditor's Report in Case of Nationalized Banks 30. Guidance Note on Auditor's Duties in relation to the Year 2000 (Y2K) Issue 31. Guidance Note on Auditor's Duties Regarding the Voluntary Disclosure of
Income Scheme 1997 32. Guidance Note on Members� Duties regarding Engagements Involving
Compilation of Financial Statements 33. Guidance Note on Engagements to Review Financial Statements 34. Guidance Note on Section 227(3)(e) and (f) of the Companies Act, 1956
(revised) 35. Guidance Note on Audit of Companies Carrying on Life Insurance Business 36. Guidance Note on Audit of Companies Carrying on General Insurance
Business 37. Guidance Note on Audit of Expenses 38. Revised Guidance Note on Audit of Accounts of Members of Stock Exchanges 39. Supplement to the Guidance Note on Audit of Banks (2003 Edn.) 40. Guidance Note on Computer Assisted Audit Techniques 41. Guidance Note on Special Considerations in Audit of Small Entities 42. Guidance Note on Audit of Consolidated Financial Statements 43. Guidance Note on Audit of Miscellaneous Expenditure (2003)
III. Studies / Monographs / Guidelines / Guides etc. related to Auditing
1. Internal Control Questionnaire 2. Technical Guide on Audit of Sugar Industry
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3. Technical Guide for Audit of Educational Institutions 4. Technical Guide for Audit of Co-operative Societies 5. A Guide to Company Audit 6. Guidelines on Internal Audit - Jute Industry 7. General Guidelines on Internal Auditing 8. Guidelines on Internal Audit - Tea Industry 9. Study on Audit of Companies Carrying on General Insurance Business 10. Guidelines on Internal Audit - Construction Industry 11. Guidelines on Internal Audit - Cement Industry 12. Guidelines on Internal Audit of Enterprises carrying on Advertising and
Publicity Business 13. Guidelines on Internal Audit - Tyre Industry 14. Study on Audit and Certification in Situations of Missing Records 15. General Clarification On Auditor�s Responsibility When Using The Work Of
An Expert 16. General Clarification on Going Concern 17. General Clarification on The Auditor�s Report on Financial Statements 18. Handbook of Auditing Pronouncements (2003 edition)
(II)and (III) Research projects in hand/ planned to be undertaken in future
1. AAS: Understanding the Entity and Its Environment and Assessing the Risk of Material Misstatement
2. AAS: The Auditor�s Procedures in Response to Assessed Risks 3. AAS: The Examination of Prospective Financial Information 4. AAS - Engagements to Review Financial Statements 5. Guidance Note on Audit of Banks (Revised 2004) 6. Guidance Note on The Relationship Between Bank Supervisors and Banks�
External Auditors 7. GN on Inter Bank Confirmation Procedures 8. AAS on Audit Evidence � Additional Considerations for Specific Items 9. Formats of Financial Statements and Audit Reports of RRBs 10. GN on E-Commerce � Effect on Audit of Financial Statements 11. Revision of the Guide to Company Audit 12. Guidance Note on Consideration of Environmental Matters in Audit of
Financial Statements 13. AAS on The Auditor�s Report on Special Purpose Audit Engagements 14. A Study on Money Laundering 15. Comparison of AASs vis a vis ISAs 16. GN on Audit of Capital and Reserves and Payment of Dividend 17. Guidance Notes on Audit of Companies in the Telecom Sector 18. LFAR in Insurance Companies
Status of Research in SAFA Member Bodies
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19. Guidance Notes on IT Environments � Stand Alone Computers 20. Guidance Notes on IT Environments � Online Computer Systems 21. Guidance Notes on IT Environments � Database Systems 22. Guidance Note on Audit of Payment of Dividends 23. Guidance Note on Audit of Mutual Funds 24. Guidance Note on Audit of Payments of Dividends 25. Glossary of Terms 26. Guidance Note on Concurrent Audit in Banks
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3 The Institute of Cost and Works
Accountants of India (ICWAI)
3.1 Management of the Institute
The profession of Cost Accounting in India was first introduced to the Indian sub-
continent in 1944. A company under the Companies Act was registered with the
objectives of promoting, regulating, and developing the profession of Cost
Accountancy. It was reconstituted by a special Act of Parliament namely the Cost and
Works Accountants Act 1959. The Institute of Cost And Works Accountants of India
(ICWA) was then established by The Cost & Works Accountants Act 1959.
The ICWAI is managed by a Council constituted under the Act .The Council is
composed of 12 Fellow members elected by members and 4 persons nominated by the
Central Government. Duration of the Council constituted under the Act is three years
from the date of its first meeting. After election of members the Council at its first
meeting elects President and Vice President from amongst the Council members.
The ICWAI is a member of International Federation of Accountants (IFAC),
International Accounting Standards Board (IASB), Confederation of Asian & Pacific
Accountants (CAPA) and South Asian Federation of Accountants (SAFA).
3.2 Research Facility
Research Departments of the Institute assist the following technical committees doing research:
Training and Educational Facilities Committee
Professional Development Committee
Research and Publication Committee
Journal Committee
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3.3 Objectives of the Technical Committees
To carry out research and publication work covering various economic spheres
and the publishing of books and booklets for the information of members in
industrial, education and commercial sectors in India and abroad.
To promote and develop the adoption of scientific methods in cost and
management accounting.
To develop the professional body of members and equip them fully to discharge
their functions and fulfill the objectives of the Institute in the context of the
developing economy.
To keep abreast of the latest developments in the Cost and Management
Accounting Principles and Practices, to incorporate such changes which are
essential for sustained vitality of the industry and other economic activities.
To organize seminars and conferences on subjects of professional interest in
different parts of the country for cross-fertilization of ideas for professional
growth.
3.4 Research Setup
A Committee of ICWAI Council namely, Research and Publications Committee
(renamed: Research & Journal Committee) looks after the Research activities. The
members of the Institute�s Council elect members of the committee. One of them is
elected Chairman, while the Director of Research (a paid executive of the Institute) is
the Secretary of the Committee. The Institute has a full-fledged Research Directorate
with all facilities.
The Committee mainly formulates the policy. The Research Directorate under the
headship of Director Research carries out research activities.
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3.5 Functions of Research and Publications Committee
The Research & Publication Committee undertakes the following functions:
Carrying out research work on costing and allied subjects and giving guidance and encouragement to the members in various areas of research activities.
Publication of research pamphlets and other literature on behalf of the Institute, subject to approval of the Council.
Making recommendations to the Council on any or all matters relating to research and publications.
Engaging research personnel on remuneration basis, subject to the approval of the Council.
Incurring expenses within the limits sanctioned by the Council for the performance of the above functions.
Carrying out any other functions as may be assigned from time to time by the Council.
3.6 Research Studies
Research studies are undertaken according to the research policies. Members of the
Institute and other experts are invited and encouraged to undertake research studies.
The Research Project proposals are considered and approved by the Committee. The
Committee (or experts engaged by the Committee) monitors the research findings. The
final reports after approval are published as Institute�s publication. The Institute also
undertakes Applied Research Projects funded by various bodies of national importance.
3.7 Institute�s Publications
Besides the research findings of various Research Projects undertaken by the Institute
or by the experts engaged for the purpose ICWAI, also publish a bi-annual Research
Bulletin containing valuable research articles on relevant topics.
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3.8 Research Work
A very significant development in the area of research in ICWAI is the development of
Cost Accounting Standards and Cost Accounting Records and Cost Audit Rules.
Projects undertaken and completed are shown in Appendix-A.
3.9 Journal of the Institute
The Institute publishes a monthly Journal �The Management Accountant�, based on
research and technical articles. It is one of the most valued professional journals on
Cost and Management Accounting, Cost Management, Economics, Finance,
Management, Corporate Laws and other relevant subjects. The Journal has an active
circulation among the students and members of the Institute.
3.10 Research Library
A large number of books, periodicals and newspapers, clippings relating to the
profession and other disciplines are available in the library.
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APPENDIX �A
ICWAI � Research Publications
(a) Miscellaneous Publications: (Projects completed)
1 Financing Asset Replacement
2 Inflation Accounting As A Tool to Fight Inflation
3 Management Accounting Problems in Small Scale Industries
4 Inflation Accounting Tools and Techniques
5 Glossary Of Management Accounting Terms
6 Corporate Capital Structure and Cost Of Capital
7 Cost and Quality Control
8 Management Information Reports for Operating Managers
9 Cost Accounting in Commercial Banking Industry
10 Farm Management Accounting And control
11 Management Accountant and The Computer
12 An Introduction to Cost Accounting in Commercial Banking Industry
13 Management And Accounting for Research and Development � The Indian Praxis
14 Research Bulletin (Biannual each issue)
15 Guidelines On Management Accounting: Capacity Determination
16 Profit Planning
17 Mutual Funds In India
18 Human Resources Accounting (b) Cost Accounting Record And Cost Audit (Report) Rules (Projects completed).
1 Cycle Industry- Edition 1999
2 Cement Industry
3 Automobile Battery Industry
4 Tire And Tube Industry
5 Tractor Industry
6 Motor Vehicles Industry- Edition 1999
7 Room Air-conditioner Industry
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8 Refrigerator Industry
9 Electric Fan Industry
10 Caustic Soda Industry
11 Electric Motors Industry
12 Aluminum Industry
13 Vanaspati Industry
14 Industrial Alcohol Industry- Edition 1999
15 Sugar Industry- Edition 1999
16 Paper Industry
17 Textile Industry- Edition 2001
18 Soda Ash Industry
19 Dyes Industry
20 Jute Industry
21 Rayon Industry- Edition 2001
22 Dry Cell Battery Industry Dry Cell Battery Industry
23 Power Driven Pump Industry
24 Cables and Conductors Industry
25 Milk Food Industry
26 Sulphuric Acid Industry
27 Steel Tubes & Pipes Industry
28 Fertilizer Industry
29 Insecticides- Tech. Grade Industry
30 Cosmetics & Toiletries Industry-Edition 2001
31 Shaving Systems Industries -Edition 2001
32 Polyester Industries �Edition 2001
33 Footwear Industries -Edition 2001
34 Soaps & Detergent Industries -Edition 2001
35 Industrial Gases Industries -Edition 2001
36 Nylon Industry- Edition-2001
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4 The Institute of Chartered
Accountants of Pakistan (ICAP) 4.1 Management of the Institute
The Institute of Chartered Accountants of Pakistan (ICAP) was established on July 1,
1961 to regulate the profession of accountancy in the Country. It is a statutory
autonomous body under the Chartered Accountants Ordinance 1961. Necessitated by
significant growth in the profession, the Chartered Accountants Ordinance and Bye-
Laws were revised in 1983.
Head office of the Institute is in Karachi. The Institute also has regional offices at
Lahore and Islamabad. The ICAP is a member of International Federation of
Accountants (IFAC), International Accounting Standards Board (IASB), Confederation
of Asian & Pacific Accountants (CAPA) and South Asian Federation of Accountants
(SAFA).
Affairs of the Institute are managed by a Council which discharges the functions
assigned to it under the Ordinance. The Council is elected for a term of four years. It is
composed of 16 members. Twelve members are elected by the members of the
Institute. Four members are nominated by the Federal Government. The Council also
elects two Vice Presidents every year, one each from Northern and Southern Region.
4.2 Research Setup
The Institute has formed various Committees for research and other technical work.
Functions of these committees are as under:
Professional Standards & Technical Advisory Services
The Professional Standards & Technical Advisory Committee (PS&TAC) is the apex
Committee of the ICAP in all matters relating to:
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Accounting Standards,
Auditing Standards,
Code of Ethics,
Corporate Laws, and
Technical queries from members.
It is supported by two Accounting & Auditing Standards Committees (AASC) and two
Technical Advisory Committees (TAC), in South and North Region.
Accounting and Auditing Standards Committees (South) & (North)
The above Committees:
Examine and offer comments on the Exposure Drafts of the International Accounting Standards (IAS) & IFRS issued by the International Accounting Standards Board (IASB)
Consider and give recommendation regarding adoption of IAS/IFRS issued by the IASB to the Council of the Institute.
Examine and offer comments on the Exposure Drafts of the International Standards on Auditing (ISAs) issued by the International Federation of Accountants (IFAC)
Consider and give recommendation regarding adoption of ISAs issued by IFAC to the Council of the Institute
Develop disclosure checklist based on the requirements of IASs and Fourth Schedule to the Companies Ordinance, 1984
Research the current trends in financial reporting and suggest appropriate changes in the local regulations
Technical Advisory Committees (South) & (North)
Technical Advisory Committees (South) and (North):
Conduct research and issue Technical Releases on accounting and auditing matters namely TRs and ATRs
Issue circulars to the members of the Institute on upcoming issues to keep them updated
Examine queries on technical matters from members and send appropriate
Status of Research in SAFA Member Bodies
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reply
Publish (finalized) selected opinions
Joint Committee of ICAP/State Bank of Pakistan
Joint Committee of ICAP and SBP has been constituted to expeditiously resolve the
issues relating to accounting and auditing of banks. The key focus areas are as under:
Conduct research and develop guidelines for external auditors to assist SBP in its supervisory role.
Examine applicability of IAS 39 and IAS 40 on banks and devise a modus operandi to smoothly implement these IASs.
Accounting and Auditing Standards for Interest Free Modes of Financing and Investments
The above Committee:
Conducts research particularly on accounting aspects of Islamic modes of financing
Develops and issues standards on the identified products of Islamic modes of financing and investments
Consults Shariah experts for clarification on various issues which come across during development of the Standards mentioned above.
Deals with queries relating to application of interest free modes of financing and investments
Committee on Taxation and Economic Policies
This Committee:
Considers queries relating to taxation and economic policies
Develops detailed proposals for incorporation in the Federal Budget
Offers comments on the drafts of rules and regulations relating to Income Tax, Sales Tax, Customs and Excise Duty etc.
Suggests necessary amendments in the rules and regulations with a view to
Status of Research in SAFA Member Bodies
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simplify the process and facilitate the taxpayers
Committee on Banking
The Committee on Banking:
Considers various accounting and auditing matters relating to banks, DFIs and NBFCs
Examines and offers comments on regulations and guidelines issued by the State Bank of Pakistan and Securities and Exchange Commission of Pakistan, relating to DFIs and NBFCs
ICAP Committees are composed of Chartered Accountants in public practice and
industry and also learned persons from outside the profession.
The Director Technical Department along with his staff is mainly responsible for
providing support to the above committees.
The Technical Department also coordinates with international professional bodies such
as IASC, IFAC, SAFA, CAPA and Accounting & Auditing Organization for Islamic
Financial Institutions.
4.3 Research Work
Projects undertaken and finished are shown in Appendix-A.
4.4 Journal of the Institute
The Institute brings out a bi-monthly Journal �The Pakistan Accountant�. It contains
research and technical articles.
4.5 Research Library
The Technical Department has a Research Library. A large number of books and
journals on different subjects are available in the library.
Status of Research in SAFA Member Bodies
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APPENDIX A
ICAP - Research Publications
(i) ICAP Technical Directorate has issued following Selected Opinions:
Selected Opinion Title
Vol � I Accounting Guidance for Members in Pakistan Corporate Laws
Vol � II Accounting Guidance for Members in Pakistan Corporate Laws
Vol � III Accounting Auditing Corporate & Other Laws
Vol � IV Accounting Guidance for Members in Pakistan Corporate & Other Laws
Vol � V Accounting Auditing Corporate & Other Laws
Vol � VI Accounting Auditing
Vol � VII Accounting Auditing
Vol � VIII Accounting Auditing
(ii) ICAP Technical Directorate has issued following Technical Releases
(Accounting):
TR-5 IASC Standards-Council�s Statement on Applicability (Reformatted-2000) TR-6 Fixed Assets Register (Reformatted-2000) TR-7 Fixed Assets Register (Reformatted-2000) TR-8 Clarification Regarding Basis of Calculation of Workers� Profit
Participation Fund (Reformatted-2000) TR-10 Deferred Taxation TR-11 Depreciation on Idle Fixed Assets (Reformatted-2000) TR-12 Debt Extinguishment TR-14 Revaluation of Fixed Assets-Accounting Treatment (Reformatted-2000)
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TR-15 Bonus Shares-Accounting Treatment (Reformatted-2000) TR-19 Excise Duty-Accounting Treatment (Reformatted-2000) TR-20 Accounting for Expenditure During Construction Period (Reformatted-
2000) TR-21 Date of Commencement of Commercial Production (Reformatted-2000) TR-22 Book Value Per Share (Revised-2002) TR-23 Accounting for Investments (Revised-1998) TR-24 Exchange Risk Free-Accounting Treatment (Reformatted-2000) TR-25 Prudential Regulations for Banks (Reformatted-2000) TR-27 IAS 12, Accounting for Taxes on Income TR-28 Golden Handshake �Accounting TR-29 Carry-Over-Transaction (COT)
(iii) Auditing Technical Releases of ICAP
ATR-1 Only members to sign audit documents ATR-6 Audit by ex-employees (Reformatted 2002) ATR-8 Preparation of accounts from incomplete records and report thereon as
auditor (Reformatted 2002) ATR-9 Signing of correspondence and financial statements by members
ATR-11 Appointment of auditors �I (Reformatted 2002) ATR-12 Appointment of auditors-II ATR-13 Lien on books of accounts due to non-payment of professional dues ATR-14 Minimum hourly charge out rates for audit work by practicing members
(Revised) ATR-16 Acceptance of Audit Assignments by New Auditors by New Auditor(s)
when Audit Fee of Existing Auditor(s) is Outstanding ATR-17
Auditors� Report to the Trustees/Board of Governors/Management Committee
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5 Institute of Cost and Management Accountants of Pakistan (ICMAP)
5.1 Management of the Institute
The Institute was established in the year 1951 as a company limited by guarantee under
the name and style of Pakistan Institute of Industrial Accountants. Its founder members
included persons like late Mohammad Shoaib, Ex-Finance Minister of Pakistan and
Executive Vice President of World Bank. Mr. Mohammad Shaoib was the first
President of ICMAP.
The Institute was reconstituted under an Act of Parliament in 1966 and
rechristened Institute of Cost and Management Accountants of Pakistan.
Head Office of the Institute is located at Karachi. The Institute also has regional offices
at Lahore and Islamabad where it has own spacious campus also. The ICMAP is a
member of International Federation of Accountants (IFAC), International Accounting
Standards Board (IASB), Confederation of Asian & Pacific Accountants (CAPA) and
South Asian Federation of Accountants (SAFA).
The Council is the governing body of the Institute. It is constituted under the Cost and
Management Accountants Act 1966, to look after the affairs of the Institute. The
Council has 12 members of which 8 are elected. Four members are nominated by the
Federal Government. The Council is required to discharge its statutory functions as
provided under the Act & Regulations.
The Council is elected for a term of three years. Office bearers are elected from
amongst 12 Council members.
Status of Research in SAFA Member Bodies
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5.2 Research Setup
A full-fledged Research Department exists in the Institute. The Research Department
which is headed by a Director who functionally reports to the Research Committee.
Outside researchers are also hired by the Institute for specific research projects. This
Department was established in 1989 with the following objectives:
To identify potential areas of research and make strategic plans for pursuing research projects.
To promote and encourage a congenial research environment for the members and students.
To draft Cost Accounting Record Orders for major industries and take steps for upgrading existing rules in the light of experience and feedback.
To update members on current issues of topical interest, particularly for practicing members.
To review and recommend revision in Cost Accounting Record Orders to the Securities & Exchange Commission of Pakistan (SECP).
To provide help and assistance to members in practice.
To provide information to members on professional issues.
To liaise with IASB bodies on professional pronouncements and to offer comments and make recommendations.
To seek enforcement and pronouncements by international and regional bodies.
To liaise with the regional Advisory Committees for research.
The Research Department carries out its functions under a Research Committee,
members whereof are named by the Council. Members of the Research Committee
consist of members of ICMAP Council, Members of the Institute and people from
outside the Institute. Subject specialists and academicians are invited to attend
meetings of the Research Committee.
Status of Research in SAFA Member Bodies
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5.3 Research Work
The Research Department since its establishment has carried out the following research
studies. The studies, duly approved by the Research Committee and the National
Council, have been published:
Cost & Management Accounting Techniques � Employed in the Cotton Textile (Ring).
Sugar Industry in Pakistan � Problems and Potentials (2000)
Input Costs and Corporate Tax Structure � An Analysis of Trends in SAARC
Region (2001)
Role of Small & Medium Enterprises in GDP and Macro Economic Development of Pakistan (2001)
Cost Audit Handbook (2001)
Cost Accounting Records Rules enforced in Pakistan: Cost Accounting Record
Order - Cement Industry
Cost Accounting Record Order
- Vegetable Ghee/Cooking Oil Industry
Cost Accounting Record Order
- Sugar Industry � 2000
Draft Cost Accounting Record Rules submitted to Securities and Exchange Commission of Pakistan (SECP) for enforcement:
Cost Accounting Record Order
- Pharmaceutical Industry � 2000
Cost Accounting Record Order
- Chemical Fertilizer Industry � 2000
Cost Accounting Record Order
- Cotton Textile Industry � 2000
Cost Accounting Record Order
- Thermal Power Generating Cos. 2001
Cost Accounting Record Order
- Engineering Industry � 2002
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Cost Accounting Record Order
- Motor Vehicle Industry 2002
Cost Accounting Record Order
- Synthetic & Rayon Industry 2002
Cost Accounting Record Order
- Electric Cables & Conductors Industry � 2003
Cost Accounting Record Order
Cycle Industry 2003
Cost Accounting Record Order
Steel Tubes and Pipe Industry 2003
Studies are in the process of review: History of Profession of Management Accounting Profession in
Pakistan Housing Industry as a catalyst for Pakistan�s economy
Industries identified for future research studies and development of Cost Accounting Record Rules:
1. Automobile Battery Industry
2. Caustic Soda Industry
3. Dyes Industry
4. Steel Tubes and Pipes Industry
5. Paper Industry
6. Refrigerator Industry
7. Soda Ash Industry
8. Tractor Industry
9. Tires & Tubes Industry
10. Gas Industry
11. Room Air Conditioner Industry
12. Aluminum Industry
13. Commercial Banks
14. Petroleum Industry
15. Telecommunications Industry
16. Electric Fan Industry
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17. Electric Lamp Industry
18. Electric Motor Industry
5.4 Journal of the Institute
The Institute publishes monthly Journal �Management Accountant� which carries
research and technical articles. When invited Research Department assists the Journal
Committee also in its publications.
5.5 Research Library
The Institute has a research library equipped with technical books, Journals, IFAC,
IASB, CAPA and SAFA publications, newspapers clippings on related subjects and
commerce, trade and finance. Research sections exist in ICMAP�s libraries at Lahore,
Islamabad and Multan also.
5.6 ICMAP Publications List of publications of the Institute appears at Appendix A.
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APPENDIX A ICMAP � PUBLICATIONS
Title 1. The Interpretations of Financial Statements and Operating Reports
2. Economic Reforms Order, 1972 3. Effective Management Reporting System 4. Tax Planning 5. International Accounting Standards 6. Effective Cash Management 7. Corporate Laws, Companies Ordinance, 1984 8. Investment Strategy for Industrial and Economic Development 1988-89 9. Cost Audit Practical Guidelines
10. Cost Accounting � A Tool for Performance Evaluation 11. Privatization � An Overview 12. Future Challenges for Audit 13. Contemporary Issues of Today�s Economy 14. Role of Management Accountants in Developing Countries 15. Modern Trends and Techniques of Management 16. Challenges of 21st Century and the Role of Management Accountants 17. Synergetic Dimension of Management 18. Modern Economic Trends and International Challenges to Industries in Pakistan 19. Responsibility of Management Accountants in Developing Countries 20. Management Accountants in Changing Global Perspective 21. The Edge of Management Accountants 22. Management Accounting - Challenges and Prospects 23. Legal Requirement for Listing of Companies - need for Restructuring of Corporate
Laws 24. Adding Value to Business 25. Inflation Accounting 26. Management Audit 27. Time Management 28. The Use of Financial Information by the Chief Engineers for Management of Large
Scale Projects 29. Divine Accounting 30. Exploring the New Frontiers of Management Accounting 31. Management Accounting for Optimal Utilization of Resources 32. Interest Free Economy and the Management Accountants 33. Management Accountants Role in Market Economy 34 Debt Management in Developing Countries 35 Education and Training of Industrial Accountants 36 Profitable Inventory Management 37 Productivity and Cost Control
Status of Research in SAFA Member Bodies
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38 The Nature and Purpose of Organization 39 Accounting Education in Pakistan 40 Waste in Project Planning, Investment Decisions and Project Implementation in
Public Enterprises in Developing Countries 41 Excellence in Manufacturing Innovative Role of Management Accountants in
Strengthening Quality Management Systems 42 Information Technology (Electronic Commerce) 43 How to Install a Cost System 44 International Accounting Standards 45 Managerial Effectiveness
46 The Future of Management Accounting in Developing Countries 47 The Integration of Managerial and Financial Accounting 48 New Accountancy 49 Internationalization of Accounting Profession 50 Capital Structure of Public Enterprises 51 Management Accounting in Government 52 Constraints to the Acceptance and Achievement of the Need for Accounting and
Accountability 53 The Application of Internal Auditing to Managerial Accounting 54 Wither Management Accounting 55 Performance and Financial Management in Public Sector Institutions 56 Control Accountability and the Management Accountants 57 The Convergence of Management Accountancy and Information Technology 58 Managing Accounting in the 21st Century 59 The Management Accountants in the Information Age 60 From Management Accounting to Executive Management and the Boardroom 61 The Challenge and Management of Change 62 Sugar Industry in Pakistan � Problems, Potentials 63 Cost and Management Accounting Techniques Employed in the Cotton Textile
(Ring) Spinning Industry of Pakistan 64 Cost Audit Handbook 65 Report on the Role of Small and Medium Enterprises in GDP and Macro Economic
Development of Pakistan 66 Input Costs and Corporate Tax Structure - an Analysis of Trends in SAARC
Region 67 SAFA Computer Education of Accountants in South Asia Approved by the SAFA
Assembly prepared and printed by ICMAP 68 Income Tax Ordinance 1979 - Critical Appraisal 69 Match Unmatch/Revenue Record Unit 70 Issues in Contemporary Manufacturing Management 71 The Role of Management Accounting in Creating Value 72 Cost and Management Audits for Banks
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6 The Institute of Chartered
Accountants of Bangladesh (ICAB)
6.1 Management of the Institute
The Institute of Chartered Accountants of Bangladesh (ICAB) is the National
Professional Accounting Body of Bangladesh, established under the Bangladesh
Chartered Accountants Order 1973 (Presidential Order No. 2 of 1973).
The Ministry of Commerce, Bangladesh is the regulating body of ICAB, which is an
autonomous professional body.
The Council of ICAB is responsible for the administration and management of the
Institute. The Council is composed of 20 members elected after every three years by
the members of the Institute from its two regional constituencies at Dhaka and
Chittagong in Bangladesh. The Council is headed by an elected President who is the
Chief Executive of the Institute. The President and the Vice-President of the Institute
are elected by the Council to manage the affairs of the Institute. The Council is
assisted by its various standing and non-standing committees. For the purpose of
assisting the Council in matters concerning its functions, the Council is empowered to
constitute Regional Committees. Presently there are two Regional Committees, one in
Dhaka and other in Chittagong. The Council has also formed two chapters one at
London, UK and other in Canada at Toronto.
The Institute of Chartered Accountants of Bangladesh is member of International
Federation of Accountants (IFAC), the Confederation of Asian & Pacific Accountants
(CAPA), International Accounting Standards Board (IASB) and South Asian
Federation of Accountants (SAFA).
Status of Research in SAFA Member Bodies
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6.2 Research Setup
The Council, besides other standing committees, has established a Technical &
Research Committee, which undertakes research work. The Committee functions
under a Chairman who is assisted by the Institute�s secretariat.
At present, there is no independent Research Department. The Director of Studies
looks after research work also. He is assisted by an Assistant Director (Technical &
Research). There are two supporting staff to look after various technical & research
related activities of ICAB.
6.3 Research Projects
Research Projects Finalized:
1st Phase of review and adoption of Bangladesh Accounting Standards (BAS)
and Bangladesh Standards on Auditing (BSA) has been completed.
Research Projects in Hand:
2nd phase of review and adopting Bangladesh Accounting Standards (BAS)
and Bangladesh Standards on Auditing (BSA) is in hand.
Research Projects Planned To Be Undertaken in Future:
As per recent negotiations between World Bank and Govt. of Bangladesh,
ICAB is expecting to obtain US$1.37 million as grant from World Bank to
strengthen the capacity of ICAB. Management of ICAB is preparing the
project profile in this regard. The proposed project is likely to start from July
2005.
6.4 Research Library
ICAB maintains a central library in Dhaka for the use of its members & students and
other research-oriented activities. There are 10,680 books and journals in the library.
Collection in the library has a good number of research related books and other
material.
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6.5 Research Publications
Research publications of ICAB are shown in Appendix-A
6.6 Journal of the Institute
The Institute publishes a quarterly journal titled "The Bangladesh Accountant" and a
monthly "News Bulletin". The journal provides an opportunity to publish research
and review articles by the faculty of the Institute and fellow academicians elsewhere.
The journal includes articles on different topics of interest for readers.
Status of Research in SAFA Member Bodies
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APPENDIX-A
ICAB-Research Publications
Publications jointly published by ICAB & UNDP under the project "Training of Chartered Accountants" (No: BGD/85/014) in December 1994:
i. National Economic Management: Project Training of Chartered Accountants;
ii. Technical Guide on Audit of Non-Government Educational Institutions;
iii. Technical Guide on Audit of Development Financial Institutions; iv. Technical Guide on Audit of Textile Industries; v. Technical Guide for Audit of Chemical Industries;
vi. Technical Guide on Audit of Sugar Industry; vii. Technical Guide on Audit of Public Utility Organizations;
viii. Management and Organization Structure: Diploma in Corporate Management;
ix. Advanced Management Accounting: Diploma in Advanced Financial Management;
x. Human Factor in Management: Diploma in Corporate Management; xi. Production and Productivity Management: Diploma in Corporate
Management; xii. Marketing Management: Diploma in Corporate Management;
xiii. Organization & Management Development: Diploma in Corporate Management;
xiv. Compendium of the Income Tax in Bangladesh: As Amended up to 30 June 1994; Bank Audit Guide;
xv. Economic Accounting and Finance; xvi. Management Control: Diploma in Corporate Management;
xvii. Tax Management: Diploma in Corporate Management; xviii. Management Audit Including Case Study: Diploma in Advanced
Financial Management; and xix. Management Accounting: Diploma in Advanced Financial
Management; Publications published by ICAB in March 2003 under The World Bank financed project "Development of Accounting and Auditing Standards in Bangladesh":
i. Strategic Plan for the Institute of Chartered Accountants of Bangladesh for 2003-2017;
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ii. Checklist for Standard Disclosures and Compliance; iii. Ethical Standards and Independence of Chartered Accountancy Profession in
Bangladesh; iv. Corporate Governance in Bangladesh; v. Education and Training System for Accountancy Profession in Bangladesh;
vi. Survey of Published Annual Reports of Listed Companies (Financial); and vii. Survey of Published Annual Reports of Listed Companies (Non-Financial);
OTHER PUBLICATIONS:
(a) Evaluation of Financial Statement as a Communication Device in Bangladesh
(Research study) written by Mr. Mahbub Ahmed, Associate Professor, Department of Accounting, University of Dhaka - First Edition, December 1982.
(b) Bangladesh Accounting Standards (BAS), Volume I & II, published by the
Institute of Chartered Accountants of Bangladesh, in April, 2004. (c) Bangladesh Standards on Auditing (BSA), published by the Institute of
Chartered Accountants of Bangladesh, in August 2004.
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7 The Institute of Cost and Management
Accountants of Bangladesh (ICMAB)
7.1 Management of the Institute
The Institute of Cost and Management Accountants of Bangladesh, an autonomous
professional body under the Ministry of Commerce, Government of People's Republic
of Bangladesh, is dedicated to Cost and Management Accounting education and
research.
The Institute is managed by a Council constituted under the Cost and Management
Accountants Ordinance, 1977. The Council is composed of a total of sixteen members.
Twelve Fellows are elected by the general members. Four members not below the
rank of Joint Secretary/Professor, representing the Ministry of Commerce, Ministry of
Finance, Ministry of Industries and Dhaka University, nominated for a three-year term
represent the government. The Council elects one President, two Vice-Presidents, one
Secretary and one Treasurer on annual basis to manage and run the affairs of the
Institute.
The Institute spearheads the formulation and implementation of national cost
accounting standards. Its goal is to help Bangladesh to become an industrialised nation
by promoting and regulating Cost and Management Accounting profession towards
market economy to enhance economic competitiveness and quality of life.
7.2 Research Setup
The Research & Development Committee consists of Chairman and five other
members. The Chairman and other members of the Committee are fellow members of
the Institute. The Committee monitors all research & technical matters. At present there
is no separate Research Department and an Additional Director (Admin & PRT)
performs the functions of research.
Status of Research in SAFA Member Bodies
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7.3 Research Work
(i). Cost Accounting Records Rules framed:
Cost Accounting Record Rules � 2000
- Jute Industry
Cost Accounting Record Rules � 2003
- Fuel and Power Sector
Cost Accounting Record Rules �
1997 - Chemical Fertilizer Industry
Cost Accounting Record Rules � 1997
- Sugar Industry
Cost Accounting Record Rules �
1997 - Pharmaceutical Industry
Cost Accounting Record Rules � 1997
- Edible Oil & Vegetable Ghee Industry
Cost Accounting Record Rules � 1997
- Textile Industry
(ii) Research Publications:
A study on the Efficiency and Performance of Public Enterprises in three South Asian countries Research study on Corporate Financial Reporting in SAFA Countries Cost Accounting in Use in Bangladesh � A Research Report Management Accounting � Fund Management in Fertilizer Industry Problems and Prospects of Sick Industries in SAFA countries � A Research Report
(iii) Research Projects in hand: "Accounting Regulatory Framework and Reporting Practices in the Context of Globalization, Public Sector Reforms and Privatization in Bangladesh" "WTO Regime and Challenges for the Professional Accountants" "Computerized Accounting" "Corporate Good Governance and Transparency" "Cost Audit in the context of Bangladesh"
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(iv) Research Projects identified for future:
Reforms in Business Sector:- Its necessity, challenges and effect in Fiscal Policy of Bangladesh Corporate Good Governance and Transparency Tax Audit Governmental Accounting and Auditing Privatization: Its effect and challenges in the economy Creative Accounting Forensic Accounting International Financial Reporting Standards (IFRS) International Standards on Auditing (ISA) Cost and Management Accounting Education Cost Management Any other issues relating to profession or economy E-Commerce Any other issues relating to profession or economy Cost Audit in the Bangladesh Context
7.4 Journal of the Institute
Institute publishes bi-monthly Journal �The Cost & Management Accountant� which
carries research and technical articles.
7.5 Research Library
At present, there is no separate and independent Research Library. Research
Publications are kept in the central library of the Institute.
Status of Research in SAFA Member Bodies
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8
The Institute of Chartered Accountants of Sri Lanka (ICASL)
8.1 Management of the Institute
The Institute of Chartered Accountants of Sri Lanka is the National Professional
Accounting body of Sri Lanka. It was established by Act of Parliament No. 23 of 1959.
The Institute has more than 2000 members. The members of the Institute are regulated
by a Code of Professional Conduct and Ethics prescribed by the Council. The Institute
is a member of International Federation of Accountants (IFAC), the Confederation of
Asian and Pacific Accountants (CAPA), the International Accounting Standards
Committee (IASC) and a Founder member of the South Asian Federation of
Accountants (SAFA).
The Institute is the sole Accounting Standards setting authority in Sri Lanka, and the
application of such standards for all companies listed on the Colombo Stock Exchange.
ICASL Council consists of the President, Vice-President and four members elected by
the members and six members appointed by the Ministry of Internal & External Trade,
Commerce & Food.
8.2 Research Setup
Technical Division of the Institute undertakes research work:
i. Sri Lanka Accounting Standards
As a member of the International Accounting Standards Committee (IASC) The
Institute of Chartered Accountants of Sri Lanka (ICASL is committed to IASC's
broad mission of the development and enhancement of accounting standards.
In working toward this mission, ICASL develops and issues Accounting
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Standards. ICASL believes that the issue of such standards will help to
improve the degree of uniformity of accounting throughout the world. Details
of the Accounting Standards finalised and issued are shown in Appendix-A,
attached.
ii. Sri Lanka Auditing Standards
The Sri Lanka Auditing Standards are based on the International Standards on
Auditing (ISA) published by the International Auditing Practices Committee
(IAPC) of the International Federation of Accountants (IFAC), with required
modifications to meet local conditions and needs. Hence, compliance with the
Sri Lanka Auditing Standards ensures compliance in all material respects with
the International Standards on Auditing.
This publication comprises only the Sri Lanka Auditing Standards, and does not
include those for related services, which are released subsequently as a
separate document in due course. These Standards are very well compiled and
provide needed material for Audit Practitioners. Details shown in Appendix-B.
8.3 ICASL launched a new Faculty on Financial Reporting
ICASL has an important role to play and improvements in practices to make in order to
restore the credibility of financial reporting. The Institute has launched a new faculty
on financial reporting. It will provide the necessary services, guidelines, research
materials and training needed to enhance the quality of financial reporting in Sri
Lanka�s corporate sector.
The faculty would also facilitate representations on financial reporting matters to be
made to the Government Department of Inland Revenue, Security & Exchange
Commission, Registrar of Companies, as well as global Institutions, such as the World
Bank, IMF and ADB.
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8.4 Insurance Industry and ICASL Statement of Recommended Practice for Insurance Contracts
Keeping in view the high potential for growth of insurance business in Sri Lanka, the
Insurance Board of Sri Lanka requested the ICASL to prepare a statement of
Recommended Practice for Insurance Contracts. A special Steering Committee
comprising ICASL Technical Division, representatives from Insurance Industry,
regulatory bodies and audit firms, was appointed for this purpose.
To prepare and finalize the statement based on the research the Steering Committee
researched into the Accounting Standards/Statements operative in UK, Malaysia,
Australia, Hong Kong, and New Zealand. The statement was released after formal
adoption of the ICASL Council.
The objective of the Statement of Recommended Practice is to specify manner of
accounting for insurance contracts in order to narrow the range of accounting patches,
and to prescribe the basis of presentation of general purpose financial statements of
entities that undertake insurance activities, thereby enhancing usefulness of published
accounting information.
8.5 Journal of the Institute
The Institute publishes quarterly Journal �The Chartered Accountant�, which contains
technical articles. The Institute also publishes Newsletter for updating students,
members and other.
8.6 Research Library
A research library equipped with various books, journals and other materials relating to
the profession, industry and commerce is maintained by the Institute.
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APPENDIX -A ICASL - Accounting Standards
SLAS 03 Presentation of Financial Statements (revised 1998 SLAS 05 Inventories SLAS 09 Cash Flow Statements SLAS 10 Net Profit or Loss for the Period, Fundamental Error and Changes in
Accounting Policies SLAS 12 Events After the Balance Sheet Date SLAS 13 Construction Contracts SLAS 14 Accounting for Taxes on Income SLAS 16 Retirement Benefit Costs SLAS 18 Property, Plant and Equipment SLAS 19 Leases (revised 2000) SLAS 20 Borrowing Costs SLAS 21 The Effects of Changes in Foreign Exchange Rates SLAS 22 Accounting for Investments SLAS 23 Revenue Recognition and Disclosures in the Financial Statements of
Banks SLAS 24 Accounting for Government Grants and Disclosure of Government
Assistance SLAS 25 Business Combinations SLAS 26 Consolidated Fnancial Statements and Accounting for Investments in
Subsidiaries SLAS 27 Accounting for Investments in Associates SLAS 28 Segment Reporting
Appendix 1: Segment Definition Decision Tree Appendix 2: Illustrative Segment Disclosures
SLAS 29 Revenue SLAS 30 Related Party Disclosures SLAS 31 Financial Reporting of Interests in Joint Ventures SLAS 32 Plantations [No corresponding IAS] SLAS 33 Revenue Recognition and Disclosures in the Financial Statements of
Finance Companies [No corresponding IAS] SLAS 34 Earnings Per Share SLAS 36 Provisions, Contingent Liabilities and Contingent Assets SLAS 37 Intangible Assets
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APPENDIX -B ICASL - Auditing Standards
1. Responsibilities:
SLAUS 1 Objective and general principles governing an audit of financial statements
SLAUS 2 Terms of audit engagements
SLAUS 3 Quality control for audit work
SLAUS 4 Documentation
SLAUS 5 Fraud and error
SLAUS 6 Consideration of laws and regulations in an audit of financial statements
2. Audit Evidence: SLAUS 13 Audit Evidence SLAUS 14 Audit Evidence � Additional Considerations for Specific Items SLAUS 15 Initial Engagements � Opening Balances SLAU 16 Analytical Procedures SLAUS 17 Audit Sampling SLAUS 18 Audit of Accounting Estimates SLAUS 19 Related Parties SLAUS 20 Subsequent Events SLAUS 21 Going Concern SLAUS 22 Management Representations 3. Planning SLAUS 7 Planning SLAUS 8 Knowledge of the business SLAUS 9 Audit materiality
4. Internal Control:
SLAUS 19 Risk Assessments and Internal Control SLAUS 11 Auditing in a computer information systems environment SLAUS Audit Considerations relating to entities using service organizations
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5. Using Work of Others:
SLAUS 23 Using the Work of Another Auditor SLAUS 24 Considering the Work of Internal Auditing SLAUS 25 Using the Work of an Expert 6. Audit Conclusions & Reporting: SLAUS 26 The Auditor�s Report on Financial Statements SLAUS 27 Corresponding Figures SLAUS 28 Other Information in documents Containing Audited Financial
Statements
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9 The Institute of Chartered
Accountants of Nepal (ICAN)
9.1 Management of the Institute
In 1985, SAFA formed a Committee to assist formation of The Institute of Chartered
Accountants of Nepal (ICAN). It recommended to the Government for the formation of
an accounting body in Nepal. In 1997, Nepal Chartered Accountants Act, 1997
received the royal seal. On 30th January, 1997 ICAN was established. ICAN has two
classes of members: Chartered Accountants and Registered Auditors. First Council of
ICAN was formed on 1st August, 1997. Nepal Chartered Accountants Regulation 1999
came into effect on 29th September, 1999.
The Council of ICAN comprising 17 members is the governing body of ICAN. As per
the provisions of Nepal Chartered Accountants Act 1997, ICAN Council has four
Standing Committees. The Act has provision of Professional Guidance Committee,
Examination Committee, Executive Committee and Disciplinary Committee. The Non-
Standing Committees include Expert Advisory Committee, Editorial Board,
Recruitment Committee, Regulation Committee, Taxation Committee, Project
Monitoring and Support Committee, Building Committee, Education Development
Committee and SAFA Committee.
The Committees members are appointed from amongst the Council members which
assist in the major functions of ICAL. The day to day functions of ICAN are handled
by a full time Executive Director. ICAN became member of SAFA on 1st August 1997.
9.2 Research Setup
There is no separate committee or Research Department to carry out research activities.
Accounting and Auditing Standards Boards are responsible to develop Accounting and
Auditing Standards. Further details in this regard are as under:
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Members of the Accounting and Auditing Standards Board
(i) One FCA member nominated by His Majesty Chairman
(ii) Representative, Ministry of Finance Member
(iii) Representative, Office of the Auditor General Member
(iv) Representative, Office of the Comptroller General Member
(v) Company Registrar, Company Registrar's Office Member
(vi) Director General, Department of Inland Revenue Member
(vii) Chairman, Securities Board/Nepal Member
(viii) Five Chartered Accountant Members nominated by His Majesty's Government on recommendation of the Council of ICAN
Member
(ix) One Registered Auditor Member nominated by His Majesty's Government on recommendation of the Council of ICAN
Member
Rights and Duties of Accounting Standard Board
The rights and duties of Accounting Standards Board are as follows:
(a) To develop accounting standards, on the basis of relevant International
Accounting Standards, in order to govern and regulate financial
reporting and accounting profession,
(b) To evolve appropriate process of development of accounting standards
and publish material related to accounting standards,
(c) To redraft, improve and revise standards,
(d) To interpret the standards,
(e) To undertake other related tasks related to accounting standards.
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Nepal Accounting Standards given below became operative for financial statements
covering periods beginning on or after 16th July, 2004.
Nepal Accounting Standards (NAS)
NAS 01: Presentation of Financial Statement
NAS 02: Net Profit or Loss for the period
Fundamental Errors on Changes in Accounting Policies
NAS 03: Cash Flow Statements
NAS 04: Inventories
Rights and Duties of Standards on Auditing Board:
The rights and duties of Standards on Auditing Board are as follows:
(a) To develop Standards on Auditing, on the basis of relevant International
Standards on Auditing, in order to govern and regulate accounting and
auditing profession,
(b) To evolve appropriate process of development of Standards on Auditing
and publish material related to Standards on Auditing,
(c) To redraft, improve and revise Standards on Auditing,
(c) To interpret the Standards on Auditing,
(d) To undertake other related tasks pertaining to Standards on Auditing
(e) Nepal Accounting Standards given below became operative for financial
statements covering periods beginning on or after 16 July 2004.
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Nepal Auditing Standards (NAS)
NAS 05: The Auditor�s responsibility to consider Fraud and Error in an Audit of Financial Statement
NAS 06: Audit Materiality
NAS 07: Planning
NAS 08: The Auditors Report on Financial Statements
9.3 Research Work
No research project has so far been undertaken by ICAN and therefore no research
publication has been issued.
9.4 Institute Journal
ICAN publishes a quarterly journal �The Nepal Chartered Accountant�. It does not
carry any research article.
9.5 Research Library
ICAN has no Research Library. There is only one single library for members and
students.
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10 Conclusion and Suggestions
The report on �Status of Research in SAFA Member Bodies� is narration of research
activities undertaken by each Institute in the SAFA fold.. It is evident that ICAI and
ICMAP ICWAI have made considerable progress in research areas as compared to
other Member Bodies.
The major research work of the Institute of Cost & Works Accountants India is based
on Cost Accounting Record and Cost Audit Rules. ICWAI has so far drafted CARs of
more than 47 industries. This is a useful task carried out by ICWAI for the
development of economy of the country. There are also other valuable research work
undertaken and published by ICWAI.
Efforts are needed to further improve and enhance the respective research areas by
each SAFA member body. For further improvement in research activities of the
member bodies, the following information may be made available on the website of
each institute:
Composition and functions of Research Department or any other department
responsible for research work.
Research publications.
Titles of articles published in their journals.
Research plans for future research studies.
Methodology of research work adopted by each institution to carry out research work.