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A hallmark of the accountancy profession is its obligation to act in the public interest. But it is not always apparent what this means, and how accountants can determine whether they are meeting this expectation. IFAC, by developing this position paper, is seeking to advance its understanding of this important issue.
IFAC developed this definition, and the assessments, to assist it in acting and making decisions that are in the public interest. The definition is used, inter alia, in formulating public policy positions for the profession, evaluating the appropriateness of new regulation, and developing professional standards. IFAC considers that the definition and assessments possess relevance to the wider accountancy profession and beyond, and may be used to assess many of the issues currently debated at the national and international levels. These issues include: the quality of financial reporting, professional standards, regulation, and corporate governance; the licensing and oversight of accountants, cross-border mobility of professionals, and market structure reforms; and professional liability reform.
In light of the challenges presented by prevailing market and economic conditions, policy-makers, regulators, standard-setters, professional accountants, and others in the financial system are examining their roles, responsibilities, and actions; and therefore it is timely to consider the basis on which these actions are taken, and decisions made.
“IFAC developed this definition of the public interest to assist us in evaluating whether our actions and decisions are in fact in the public interest”, said IFAC CEO, Ian Ball. “Whether we are using it to develop public policy positions, professional standards, or guidance and tools, we believe the definition provides rigour, objectivity and consistency in assessing the important public interest perspective of our work. It applies not only to evaluating past and current actions and decisions, but also guides our behaviour and the manner in which we assess future actions and decisions. We believe that the definition may also be relevant to other organisations and individuals that seek to act in the public interest, and feel the need for increased rigour in evaluating their actions and decisions.”
The development of the position paper included a public consultation process. Comments and feedback received from a range of stakeholders in the accountancy profession, regulatory community and academia were considered, and incorporated into the final paper. “While we consulted widely on this policy positiin paper before issuing it, we continue to invite dialogue on the subject”, continued Ball. “Clearly it is a complex subject, and we hope that this paper is the beginning, rather than the end, of the debate.”
Link to Position Paper 5 & appendices