Home > Minutes > 2010 > FRC Meeting Minutes - 3 March 2010

Fifty Fifth Meeting
3 March 2010

Outcomes of the meeting held on 3 March 2010 at the offices of the Australian Accounting Standards Board, Level 7, 600 Bourke Street, Melbourne. The meeting commenced at 9.00 am and concluded at 1.05 pm.

Attendance

FRC Members:
Mr Jeffrey Lucy AM
Mr Bruce Brook
Mr Don Challen
Mr Michael Coleman
Mr Mark Coughlin
Mr Michael Dwyer (until 11.05 am¹)
Mr John Gethin-Jones
Dr Stein Helgeby
Ms Noelle Kelleher
Ms Merran Kelsall
Mr Eric Mayne
Mr Jim Murphy
Mr Kevin Simpkins
Mr John Stanhope
Mr Kevin Stevenson
Mr John Trowbridge
Ms Jan West AM
Mr Stuart Wilson
Mr Klaus Zimmermann

Invitees:
Mr Bede Fraser (Australian Treasury)
Ms Judith Downes (Standards Advisory Council – agenda item 3(c))

Visitors
Ms Jennifer Lewis (ASIC – Technical Adviser to Bapepam-LK)
Mr Djonieri (Head of International and Public Relations Division, Bapepam‑LK)
Mr Eko Butsiono (Accounting and Disclosure Standards Bureau, Bapepam‑LK)
Mr M Mukhtar (Accounting and Disclosure Standards Bureau, Bapepam‑LK)

FRC Secretariat:
Ms Genevieve Watson (FRC Secretary)
Mr Les Pascoe

Apologies:
Ms Caithlin Mc Cabe
Mr Warren McGregor

Agenda Item 1 – Apologies and welcome

The FRC Chairman, Mr Lucy, welcomed FRC members and other attendees to the 55th meeting of the Council.

In particular, Mr Lucy welcomed Dr Stein Helgeby to his first meeting of the Council. Dr Helgeby, who was appointed to the FRC during February on the nomination of the Department of Finance and Deregulation, has replaced Ms Kathryn Campbell as a member of the Council. Mr Lucy also took the opportunity to express his appreciation of Ms Campbell's contribution to the work of the Council during her term of appointment.

Mr Lucy also welcomed Ms Jennifer Lewis, ASIC's Technical Adviser to Indonesia's Bapepam‑LK, and Messrs Djonieri, Eko Butsiono and M Mukhtar, representatives of Bapepam LK, to the FRC meeting. Messrs Djonieri, Eko Butsiono and M Mukhtar were in Melbourne to attend ASIC's 2010 Summer School and the opportunity was taken for them to observe a meeting of the FRC and the issues that it is currently addressing.

(a) Declarations of interest

The FRC noted the register of interests circulated by the Secretariat. Amendments to entries in the register were advised by Messrs Brook, Coughlin, Gethin‑Jones, Simpkins, Stanhope and Stevenson.

(b) Confirmation of the minutes of the last meeting

The Minutes of the 54th meeting, which was held in Melbourne on 1 December 2009, were approved.

(c) Matters arising from the minutes of the last meeting

The Secretariat paper on matters arising from the Minutes of the last meeting was noted. Issues raised during the consideration of this paper included:

Ms Kelsall reported that she had met with Prof. Jayne Godfrey of the Water Accounting Standards Board (WASB) to discuss assurance matters associated with the WASB's work. Ms Kelsall agreed to advise Treasury of developments in respect of this matter for the purpose of briefing the Minister.
It was noted that the letter to relevant Ministers concerning the use within government requirements of the words ‘audit' and ‘assurance' would also be copied to Ms West.
The desirability of re-focusing future Ken Spencer Memorial Lectures on their original objective – a thoughtful presentation on a core issue. Mr Stevenson, who presented the first lecture, informed the meeting that future speakers need to continue to have a feel for what the lecture is trying to achieve.

The Ken Spencer Memorial Lecture for 2010 was held in Melbourne on the evening before the Council meeting. The Lecture, which was attended by about 90 people, was delivered by Mr Tim Flynn, Chairman of KPMG International and Chairman of KPMG LLP, its US member firm. The text of Mr Flynn's presentation, Restoring Trust and Building Confidence, can be viewed on the FRC website. The FRC would like to officially thank Mr Flynn for his thoughtful and timely presentation as well as acknowledge the roles played by KPMG and the three professional accounting bodies in arranging the Lecture.

(d) Votes by Circular Resolution

The FRC noted that no votes by circular resolution had been conducted since the Council meeting on 1 December 2009.

Agenda Item 2 – Stakeholder engagement

(a) Report by FRC Chairman

Matters mentioned by the FRC Chairman in his report included:

the US Securities and Exchange Commission's decision to issue a statement that lays out its position regarding global accounting standards and makes clear that the Commission continues to believe that a single set of high quality globally accepted accounting standards would benefit US investors (albeit not until 2015 at the earliest);
dialogue with New Zealand concerning proposals by the Ministry of Economic Development and the Accounting Standards Review Board to reform New Zealand's financial reporting framework;
his facilitating an ASIC Summer School workshop entitled ‘The role of accounting standards in the [global financial] crisis: exacerbating the cycle?'. The commentators for the workshop were FRC members Michael Dwyer and Kevin Stevenson and former FRC Chairman Charles Macek; and
a meeting with Jeremy Cooper, Chair of the Review into the governance, efficiency, structure and operation of Australia's superannuation system, about superannuation accounting issues.

(b) Reports by Stakeholders

(i) Chair of AASB

A report by Mr Stevenson, Chair of the AASB, covering the work of the Board during the period since the FRC meeting on 1 December was circulated for consideration at the meeting.

In speaking to his report, Mr Stevenson identified a number of themes associated with the AASB's work, including: global financial crisis-related matters such as amendments to Australian accounting standards to reflect changes made by the IASB; consideration of public sector-related projects that have been raised for the Board's consideration and the continuation of work on GAAP/GFS harmonisation; a project on disclosures by private sector not‑for‑profit entities; and continuing work on differential financial reporting, with an exposure draft on a reduced disclosure regime for non‑publicly accountable entities being released at the end of February.

Following consideration of Mr Stevenson's report, Mr Lucy proposed that Paul Madden, of Treasury's Standard Business Reporting program, be invited to attend an upcoming meeting of the FRC to update Council members on Australia's adoption of XBRL.

(ii) Chair of AUASB

A report by Ms Kelsall, Chair of the AUASB, on the work of the Board during the period since the last FRC meeting was circulated for consideration at the meeting.

Ms Kelsall's report canvassed a number of issues being progressed by the AUASB, including: the commencement of training sessions about the ‘clarity' standards; planning of the AUASB's work program; preparations for the visit by Professor Schilder of the IAASB during May; involvement with New Zealand's Professional Standards Board, including consideration of measures that might streamline the operations of the two Boards; and input into various international projects being undertaken by the IAASB.

(iii) Other stakeholders

The following comments were made concerning matters of interest to the FRC's stakeholder bodies:

ASIC: Mr Dwyer advised the meeting that ASIC had completed its financial reporting surveillance for the year ended 30 June 2009. He indicated that ASIC had issued a media release in January 2010 highlighting the results of the surveillance and including information about ASIC's areas of focus for reporting periods ended 31 December 2009. ASIC's audit inspection report covering the 18 months to 30 June 2009 should be released shortly after the FRC meeting. Mr Dwyer also advised that ASIC was reviewing its processes in view of major collapses arising from the global financial crisis and in anticipation of further potential problems that may arise in the coming year. Whilst ASIC believed the quality of audit services was good, it anticipated increased engagement with audit firms in the future. In concluding, Mr Dwyer took the opportunity, on behalf of ASIC, to thank those FRC members who had contributed to the success of ASIC's Summer School.
BCA: Mr Graham Bradley has been appointed national president of the BCA. Mr Brook indicated that one financial reporting issue that is currently of interest to the BCA is underlying earnings.
IFSA: Issues of interest include possible reforms in the superannuation and taxation industries and changes to the financial planning industry and its fee structure.
G100: The recommendations in the Group's publication Less is More are now being road tested. It was noted that the testing of the proposals with auditors has raised the issue of how to audit management's judgment on disclosures – the G100 aims to develop principles to address this issue. Other issues of interest to G100 include the amendments in the corporate reporting reform Bill and the proposed consultations on audit quality.
Australian Treasury: Principal areas of interest include the corporate reporting reform Bill, audit quality, differential reporting, mutual recognition of audit oversight arrangements, executive remuneration and proposed reforms to the corporate whistle blowing provisions.
ASA: The Association has been undertaking research on audit perceptions, including seeking retail investors' views of the audit statement.
CPA Australia: Issues of interest include corporate law reform and differential reporting. The meeting was informed that the three professional accounting bodies are currently working closely on a number of initiatives.
Heads of State and Territory Treasuries: Ensuring progress with the public sector's accounting standards-setting priorities, including finalisation of the GAAP/GFS project.
ICAA: Main issues are differential reporting and seeking an extension of the auditor rotation period from five to seven years.
AICD: In addition to matters such as underlying profits and differential reporting mentioned by other stakeholders, the Institute's reporting committee is currently considering the Productivity Commission's report on executive remuneration. The Committee is also considering issues concerning compliance with International Financial Reporting Standards.
NIA: Issues of interest are similar to those raised by CPA Australia and the ICAA.
ASFA: Issues of interest include the Cooper review (superannuation), the Henry review (taxation) and accounting standards for superannuation funds.
APRA: The prudential standard on executive remuneration comes into force on 1 April 2010. The main impact of the standard will be on the larger entities that are subject to APRA's supervision.
ASX: The main issues include: the changes to ASX and ASIC responsibilities in respect of market supervision; changes to dealing policies that will apply from 1 January 2011 with the requirements being moved from guidance to rules; implications for the listing rules flowing from the Government's response to the Productivity Commission's report on executive remuneration; and the release of draft recommendations during April concerning diversity policies [for the boards of companies].

Agenda Item 3 – International matters

(a) Report from Chair of NZ ASRB

Mr Simpkins, Chair of the NZ ASRB, provided FRC members with an update on proposals by the Ministry of Economic Development (MED) and the ASRB for revising New Zealand's financial reporting framework. He indicated that comments had been raised about MED's proposals for auditor registration and oversight and that refinements are being considered to enable the regime to meet international expectations. In addition, he indicated that the timetable for MED's proposed structural changes, including the reconstitution of the ASRB as the External Reporting Board, is likely to be accelerated. Finally, it was noted that Minister Simon Power had announced that the Government had decided that large non-issuer companies would not be required to file their financial statements with the Registrar of Companies.

Mr Simpkins also informed the meeting that the ASRB had received approximately 80 submissions on its proposals concerning the application of accounting and assurance standards under the new financial reporting framework. The ASRB is currently preparing a phased transition plan for making decisions on and then implementing the new arrangements, having regard to MED's accelerated timeline.

(b) Report from TTAASAG

The FRC noted the Secretariat paper (and attached minutes) about the TTAASAG meeting held on 2 December 2009 in Melbourne and Mr Fraser's oral report about the TTAASAG meeting held on 25 February 2010 in Wellington NZ.

During Council's consideration of these reports, the FRC Chairman asked Treasury to:

provide a document identifying the matters included in the Joint Statement of Intent agreed by the Prime Ministers of Australia and New Zealand that fall within the FRC's area of responsibility for inclusion in the minutes of the FRC meeting (see Attachment A); and
inform Minister Bowen that the New Zealand Minister, Simon Power, may be invited to attend a forthcoming meeting of the FRC.

(c) Reports on activities of international bodies

Reports on recent activities of the IASB's International Financial Reporting Interpretations Committee meeting on 7-8 January 2010 (prepared by Ms Ruth Picker) and the Standards Advisory Council (SAC) meeting on 22-23 February 2010 (prepared by Ms Judith Downes) were provided to Council members. Ms Downes was present for this item and spoke to her report.

Following consideration of Ms Downes' report, and in particular her reference to comments made at the SAC meeting about underlying earnings, the FRC Chairman proposed that he write to the IASB Chairman suggesting that Australia lead a team undertaking research on underlying earnings. The meeting endorsed this proposal.

In addition, the meeting noted that Mr Ken Warren's report on the 8‑11 December 2009 meeting of the International Public Sector Accounting Standards Board had been circulated to Council members on 22 December.

(d) G-20 and Financial Stability Board update

The Council noted a Secretariat paper providing an update on recent work of both the G‑20 and the Financial Stability Board.

Agenda Item 4 – Strategic matters

(a) Public Sector accounting – GAAP/GFS Project, Phase 2

The FRC was briefed on recent work by the AASB on this matter. At the AASB's February meeting, it was agreed that the AASB's staff would further develop their recommendations for the content of a standard focusing explicitly on improving the usefulness of general purpose financial statements of entities within the general government sector. The FRC was informed that such a standard would go significantly beyond the proposals in the previous exposure draft and would more likely require further due process through an exposure draft.

During the FRC's consideration of this matter, the AASB's concerns about FRC strategic directions and individual board members' responsibility in deciding appropriate standards were noted. It was agreed that, in the longer term, these issues need to be reviewed and the FRC Chairman asked Treasury to bring the AASB's material to the FRC at an appropriate time.

(b) Differential Reporting

A Secretariat paper providing a status report on the progress of the differential financial reporting reform proposals since the last Council meeting was circulated for the information of Council members. The meeting was informed that at the end of February, the AASB released for comment an exposure draft proposing lower disclosure requirements for entities that are not public interest entities. The proposal envisages entities being subject to the recognition and measurement contained in full IFRS, but with reduced disclosure requirements generally based on the IASB's IFRS for SMEs standard.

(c) Corporate Reporting Reform Bill

Mr Fraser provided FRC members with a status report on the Government's Corporations Amendment (Corporate Reporting Reform) Bill 2010. He said some 50 submissions had been received, with stakeholders being broadly supportive of the proposed reforms and most comments focusing on technical aspects of the Bill.

Mr Fraser informed the meeting that it is hoped the Bill will be introduced and passed during the Australian Parliament's Winter sittings (subject to Parliamentary and other resourcing requirements), thus enabling most of the Bill's reforms to apply to the financial year ending on 30 June 2010.

(d) Audit independence function

The FRC approved its Audit Independence Function Work Program for the period to 30 June 2010.

The work program provides for meetings with stakeholder bodies to obtain the information needed to perform the FRC's statutory functions. In addition, it is proposed that there be a detailed examination of Australian and international developments on ethics, auditor rotation and non-audit services and consideration of audit related lessons from the global financial crisis.

The FRC also noted the suggestion by the Chair of the AUASB that the Board be included in the list of bodies with which representatives of the FRC could meet as part of the work program.

(e) Audit quality

Mr Fraser provided Council members with a status report on Treasury's consultation paper Audit Quality in Australia: A Strategic Review. The meeting was informed that the Minister for Financial Services, Superannuation and Corporate Law had approved the public exposure of the paper for a two month consultation period and that the FRC Chairman had been invited to release the paper².

The FRC Chairman asked Treasury to ensure that the paper was provided to FRC members prior to its public release.

(f) Regulator review of superannuation fund compliance with financial reporting requirements

A Secretariat paper providing a status report on the issue of regulator review of compliance by superannuation funds with accounting standards was noted by the FRC.

Mr Lucy informed the meeting that:

he had written to Mr Jim Murphy, Executive Director, Markets Group, Treasury, on 21 December 2009 bringing to Mr Murphy's attention the issue of the regulator reviewing compliance by superannuation funds against accounting standards; Mr Murphy indicated that he had received the letter and would shortly write to Mr Ross Jones, Deputy Chairman of APRA to gain APRA's view on the existing regulatory settings and requirements. Mr Murphy said that this would assist in considering the merits of such a review occurring in Australia; and
he had had discussions with Mr Jeremy Cooper concerning financial reporting by superannuation funds. Mr Lucy indicated that he had offered to provide Mr Cooper's inquiry with assistance on financial reporting-related issues.

During the discussion, Messrs Trowbridge and Dwyer informed the FRC about the respective responsibilities of APRA and ASIC in relation to superannuation funds' compliance with financial reporting requirements.

The meeting agreed that further consideration should be given to this issue following the receipt of additional information from APRA.

(g) Review of APES 110

A Secretariat briefing on the Accounting and Professional Ethics Standards Board's consultation paper about a proposed revision of APES 110 Code of Ethics for Professional Accountants was noted by the Council.

(h) Auditor Oversight Mutual Recognition Arrangements

The FRC noted a paper prepared by ASIC containing information about Australia's mutual recognition arrangements with audit regulators in the United States of America, member states of the European Union, Japan and Canada.

(i) IASB Chairmanship

The FRC noted a Secretariat paper on the action being taken by the IASC Foundation to identify a preferred candidate to succeed Sir David Tweedie as Chairman of the IASB when his term ends in June 2011.

(j) International audit representation

The FRC noted advice from the Joint Accounting Bodies that they are writing to the President of the International Federation of Accountants seeking formal observer status for Australia on the International Auditing and Assurance Standards Board.

Agenda Item 5 – FRC operations

(a) Remuneration of AASB and AUASB members

The FRC approved an increase in sitting fees for AASB and AUASB members (other than the Chairs) from $810 per day to $835 per day, for meetings commencing on or after 1 January 2010. In making this decision, Council noted the recent determination of the Remuneration Tribunal increasing sitting fees for offices coming within its jurisdiction by 3.0 per cent with effect from 1 October 2009.

(b) Nominations Committee report

The Chair of the Nominations Committee, Mr Zimmermann, informed the meeting that a member of the AUASB had resigned from the Board and that a vacancy was expected to occur on the AASB later in the year. Following consultation with the FRC Chairman, the Committee Chair proposed that the appropriate course of action would be to leave any positions that become vacant unfilled and fill them as part of the annual program of filling positions falling vacant at the end of members' terms of appointment. The FRC approved this proposal.

(c) Revision of rules of procedure

The FRC approved an amendment to its Rules of Procedure to establish a protocol for communications between members of the Council and members of the standards setting boards. The Rules, as amended, are attached to these Minutes (see Attachment B).

Agenda Item 6 – Correspondence

A Secretariat paper listing FRC correspondence for the period from 30 November 2009 to 2 February 2010 was noted.

Agenda Item 7 – Other business

(a) Arrangements for meeting with Prof. Schilder and May meeting

The FRC agreed that there would be an informal meeting of the Council in Melbourne on Tuesday, 11 May, to enable those members who were available to meet with Professor Arnold Schilder, Chairman of the International Auditing and Assurance Standards Board. Arrangements for the meeting would be finalised by the Secretariat in consultation with the Chair of the AUASB and circulated to FRC members.

The FRC also agreed that a full-day meeting combining regular and strategic planning issues would be held in Melbourne on Tuesday, 18 May. It was further agreed that where a member of the Council would be unable to attend this meeting, the member's stakeholder body would be invited to nominate an alternative attendee.

(b) Other matters

No other matters of other business were raised.

Agenda Item 8 – Next Meeting

The next regular meeting of the FRC will be held in Melbourne on 18 May 2010.

Attachment A

Single Economic Market Outcomes Framework as Identified in Prime Ministers Rudd and Keys Joint Statement of Intent,
20 August 2009

Trans Tasman Outcome Proposals	Benefits to be achieved/problem being addressed	Timeframe Short term: within 2 yrs Medium term: within 5 yrs
Financial reporting policy
Profit entities are able to use a single set of accounting standards and prepare only one set of financial statements.	This would allow a reduction in compliance costs for entities operating across the Tasman. It would support trans-Tasman investment through the consistency of financial statements	Short term
Not-for-profit entities are able to use a single set of accounting standards and prepare only one set of financial statements.	This would allow a reduction in compliance costs for entities operating across the Tasman.	Medium term
Auditors registered in one country can operate in the other country	This would open up the trans-Tasman market for audit services and take out transaction costs.	Medium term
Financial reporting standards bodies in Australia and New Zealand have functional equivalence.	The equivalence of functions will make it easier for organisations to work more effectively together.	Medium term
Trans-Tasman companies have to prepare only one set of financial statements to one set of standards.	This would reduce compliance costs for trans-Tasman companies.	Short term

Attachment B

FRC Rules of Procedure

1. Meetings

1.1 Notice of a proposed meeting of the Council will be provided, in writing by the secretariat on the Chairman's behalf, no later than 30 days before the meeting date.

1.2 Meetings may be held using electronic conferencing facilities and business may be conducted without meeting, at the Chairman's discretion.

1.3 Subject to paragraph 11, meetings will be held in private.

2. Quorum

2.1 Half the number of members constitutes a quorum for a meeting.

3. Presiding officer

3.1 The Chairman of the Council will preside at all meetings, except:.

in the absence of the Chairman, the Deputy Chairman will preside;
in the absence of both the Chairman and the Deputy Chairman, the Council members present may choose another member to chair the meeting.

4. Voting

4.1 Every appointed member present in person or by proxy has one vote, whether on a show of hands or on a poll.

4.2 Where there is a show of hands, a resolution will not be taken to be carried unless there is an affirmative vote of more than 50 per cent of those entitled to vote. In the event of a tied result, the presiding Chairman will have the casting vote, in addition to his or her vote.

4.3 Where there is a poll, a resolution will not be taken to be carried unless there is an affirmative vote of more than 50 per cent of those entitled to vote. In the event of a tied result, the presiding Chairman will have the casting vote, in addition to his or her vote.

5. Taking of Poll

5.1 If a poll is required, it must be taken in such a manner and at such a time and place as the presiding Chairman directs.

5.2 The result of the poll will be deemed to be the resolution of the meeting at which the poll was sought.

5.3 In the case of a dispute as to the acceptance or rejection of a vote, the presiding Chairman shall determine the dispute and the determination made in good faith will be final and conclusive.

6. Circular Resolutions

6.1 When the Council must reach a decision between meeting dates, this decision may be made by circular resolution.

6.2 In carrying out a vote by circular resolution, the Secretary to the FRC must attempt to contact all FRC members. A circular resolution will be taken to be carried only when the majority of FRC members vote in the affirmative.

6.3 Where the Council conducts a vote by circular resolution, the outcome of the vote is to be tabled at the first Council meeting held after the conclusion of the voting period specified in the message seeking the vote and recorded in the minutes of that meeting.

7. Minutes as Evidence of Result

7.1 A declaration will be made by the presiding Chairman that a resolution, on a show of hands or on a poll, has been carried or not.

7.2 Upon this declaration an entry by the Secretary to that effect in the minutes of the proceedings of the Council, signed by the Chairman, will be conclusive evidence of the fact without proof of the number or proportion of the votes recorded in favour or against the resolution.

8. Confidentiality

8.1 The Council must take all reasonable measures to protect from unauthorised use or disclosure information given to it in confidence, in accordance with section 237 of the Australian Securities and Investments Commission Act 2001.

9. Conflicts of interest

9.1 Under the Australian Securities and Investments Commission Act 2001, the Council:

provides broad oversight of the processes for setting accounting and auditing standards in Australia, including: giving advice or feedback to the AASB and the AUASB on their priorities, business plans, and procedures; giving advice or feedback to the Offices of the AASB and AUASB on their budgets and staffing arrangements; and determining the AASB's and AUASB's broad strategic direction. The Council recognises that the ASIC Act specifically precludes the Council from directing the AASB or the AUASB in relation to the development or making of a particular accounting or auditing standard and provides that it does not have the power to veto a standard formulated and recommended by either the AASB or the AUASB; and
monitors the effectiveness of auditor independence requirements in Australia, having particular regard to the systems and processes of audit firms, quality review programs and disciplinary procedures of the professional accounting bodies, the teaching of ethics by those bodies and compliance by companies with audit-related disclosure requirements.

9.2 Any member who becomes aware of a material personal interest in a matter that relates to the affairs of the Council, AASB or AUASB must give the other members notice of the interest. The notice must:

give details of the nature and extent of the interest and its relation to the affairs of the Council, the AASB or the AUASB; and
be given at a meeting of the Council as soon as practicable after the member becomes aware of the interest, and be recorded in the minutes of the meeting.

9.3 A member may give the other members standing notice about an interest. The notice may be given at any time and whether or not the matter relates to the affairs of the Council, the AASB or the AUASB at the time the notice is given.

9.4 A standing notice must give details of the nature and extent of the interest and be given at a meeting of the Council (either orally or in writing) or to the other members individually in writing. A standing notice given to the other members individually in writing must be tabled at the next meeting of the Council after it is given. The member must ensure that the nature and extent of the interest disclosed in the standing notice is recorded in the minutes of the meeting where the standing notice is given or tabled.

9.5 The standing notice takes effect as soon as it is given and ceases to have effect in relation to a particular interest if the nature or extent of the interest materially increases above that disclosed in the notice.

9.6 Members who have a material personal interest in a matter that is being considered at a meeting of the Council must not be present while the matter is being considered at the meeting or vote on the matter unless the other members have passed a resolution that: identifies the member, the nature and extent of the member's interest and its relation to the affairs of the Council, the AASB or the AUASB; and states that those members are satisfied that the interest should not disqualify the member from voting or being present.

9.7 Members will provide other members, through the secretariat, with a list of their current affiliations and update this list as affiliations change.

9A. Correspondence with Members of Standards-Setting Boards

9A.1 Where a member of the FRC writes to a member of a standards-setting board concerning their role or actions as a member of that board, the FRC member's letter must:

identify the capacity in which, or on whose behalf, the letter is being written; and
be copied to the FRC Chairman.

9A.2 Where a member of the FRC has concerns about the actions or performance of a member of a standards setting board in fulfilling their role as a member of that board:

the FRC member should raise his or her concerns with the FRC Chairman; and
the FRC Chairman should contact the Chair of the standards setting board concerned to discuss the matter.

10. Appointment of Proxies

10.1 A member of the Council may, in writing, appoint another person who is a member of the Council as his or her proxy to vote on his or her behalf at a meeting of the Council at which the first-mentioned member is not present.

10.2 An instrument appointing a proxy shall be deposited with the Chairman before the time for holding the meeting at which the person named in such instrument proposes to vote.

10.3 An instrument appointing a proxy may direct the proxy as to the manner in which the proxy is to vote on a particular matter or matters that may arise at the meeting or on a particular motion or motions that may be proposed at the meeting.

11. Observers and Guests

11.1 A member of the Council may only invite observers or guests to attend FRC meetings with the approval of the FRC Chairman.

11.2 Observers and guests at FRC meetings do not have any voting rights.

11.3 All persons, other than FRC members and proxies appointed under these rules, present at FRC meetings have observer or guest status only.

12. Representing the FRC

12.1 Subject to paragraph 12.2, only the Chairman and Deputy Chairman of the FRC are authorised to publicly speak on behalf of the FRC.

12.2 The Chairman of the FRC or, in the Chairman's absence, the Deputy Chairman, may authorise another member of the FRC to publicly speak on behalf of, or otherwise represent, the Council. The authorisation is to be in writing and to specify the purpose for which the member is to represent the Council.

¹ Mr Dwyer was in attendance for consideration of agenda items: 1(a), (b), (c) and (d); 2(a), (b)(i), (b)(ii) and (b)(iii) (part); 3(c); 4(b), (f), (g) and (h); and 7.

² The release of the Treasury paper occurred on 5 March 2010.

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Fifty Fifth Meeting 3 March 2010