Bulletin
2007 / 5 – 17 December 2007
The last meeting of the Financial Reporting Council (FRC) for 2007 was held in Sydney on 6 December 2007. The principal matters dealt with at the meeting were:
- the performance of the FRC’s auditor independence function;
- 2008 appointments to the Australian Accounting Standards Board (AASB) and the Auditing and Assurance Standards Board (AUASB);
- reports from standards setters and committees; and
- presentations from the Australian Treasury on implementation of the Uhrig reforms and an overview of the standard business reporting programme.
Auditor Independence functions
Ms Catherine Walter was appointed Chair of the Audit Independence Committee, replacing Ms Elizabeth Alexander who retired from the Council on 31 October.
The meeting was informed that the FRC’s 2006‑07 Report on Auditor Independence had been approved in an out-of-session vote and that it would be printed prior to submission to the Minister.
The meeting was given a status report on the proposals to engage consultants to undertake the auditor independence consultancy and the development of a conceptual framework for the structural arrangements for financial reporting requirements. The role of these consultants will be progressed in consultation with the new FRC Chairman and the new Chair of the Committee.
Appointments to AASB and AUASB
The Nominations Committee’s recommendations on the appointments and re-appointments to be made to the AASB and AUASB during 2008 were considered and approved by the FRC.
A separate announcement about these appointments will be made as soon as the corresponding instruments of appointment are finalised.
Reports from standards setters and committees
The FRC received reports from the respective Chairs of the AASB, AUASB, FRC Finance Committee, FRC Nominations Committee and FRC Audit Independence Committee. A report was also received from the Chairman of the Trans-Tasman Accounting and Auditing Standards Advisory Group (TTAASAG).
In addition to the matters mentioned above, issues addressed in, or arising from, these reports included:
- ensuring adequate funding for Australia’s involvement in the international and domestic standards setting processes continues to be a concern for the Council, and the meeting noted the Finance Committee’s call to progress work on a paper arguing for full government funding of the standards setting bodies;
- Professor Stephen Zeff of Rice University has accepted an invitation to deliver the 2008 Ken Spencer Memorial Lecture in Sydney on 28 May 2008; and
- Mr Geoff Miller of the Australian Treasury is replacing Mr Warwick Hunt as Chairman of TTAASAG.
Presentations by Australian Treasury
The FRC received a briefing from representatives of the Treasury on:
- progress with implementation of the proposed governance reforms and the implications of those reforms for the FRC; and
- the objectives of the standard business reporting regime and the issues being addressed under that programme.
Uhrig reforms
In response to the Review of the Corporate Governance of Statutory Authorities and Office Holders (the Uhrig Review), it is proposed that the AASB and AUASB move from the Commonwealth Authorities and Companies Act 1997 to the Financial Management and Accountability Act 1997 framework.
The FRC noted progress on the implementation of the proposed reforms and its implications for the FRC. It was noted that the proposed reforms would need to be considered by the new Government.
Standard Business Reporting
Standard Business Reporting (SBR) is a multi-agency programme which has the objective of reducing the regulatory reporting burdens for business. The objectives of the programme are to eliminate unnecessary reporting, eliminate duplicated reporting and improve the electronic interface between business and government agencies. The project currently covers the period 2007 to 2010 and its scope is limited to the Financial Reporting domain.
Work being undertaken within the current scope includes: harmonisation of reporting terms; creation of a ‘reporting taxonomy’; mapping the reporting taxonomy to a business’ accounts; developing SBR core services; connecting government agency systems to the core services; and educating and two-way communication with business, software developers and business intermediaries.
Other matters
Reports were provided on a number of recent meetings with stakeholders and other bodies, including:
- Mr Charles Macek’s visit to Europe during October to meet with representatives of oversight and standards setting bodies; and
- Ms Judith Downes’ report on the Standards Advisory Council meeting held in November.
The FRC decided that in 2008 its meetings would be held on 12 February (Melbourne), 9 April (Melbourne), 11 June (Canberra), 3 September (Sydney) and 26 November (Melbourne).
The meeting concluded with Council members commending Mr Macek for his contribution to the work of the FRC over the last eight years, including a period of almost five years as Chairman.
About the FRC
The FRC is the peak body responsible for the broad oversight of the accounting and auditing standard setting process for the private and public sectors, as well as monitoring the effectiveness of auditor independence requirements in Australia. It comprises key stakeholders from the business and investing communities, the professional accounting bodies, governments and regulatory agencies. A list of the current FRC membership is on the FRC’s website.
The FRC advises the Government on the accounting and auditing standard setting process and on the development of international accounting and auditing standards. It determines the broad strategic direction of the standard setters, the Australian Accounting Standards Board and the Auditing and Assurance Standards Board.
For further information, please contact the Secretary of the Financial Reporting Council c/- The Treasury, Langton Crescent, Parkes ACT 2600.
Ms Suzanne Howarth
Ph: (02) 6263 3144 Fax: (02) 6263 2770
E-mail: frcsecretary@frc.gov.au or visit the FRC’s website at www.frc.gov.au.