The Chartered Accountants Regulatory Board has posted several documents to its website in the early part of the year which provide a useful insight into the approach it is going to take in respect of regulation and monitoring including its:-

Corporate Governance Framework for 2011

Which outlines the higher level governance parameters such as the role of the Board, the Terms of Reference for the various Committees, as well as details of budgets and performance.  This document sets the parameters for the day to day structure and activity of CARB and its executive.

Regulatory Strategy for 2011

This document outlines the principles of regulation as well as CARB’s aims and  strategic objectives for 2011 and provides information on the internal staffing structures.

CARB indicates that its strategic priorities in 2011 are to :-

• Review all standards with a view to simplifying, streamlining and merging
• Review and update the Quality Review Regulations to reflect the new monitoring and review structure
• Provide guidance on the new standards approved in 2010 and being implemented in 2011
• Fundamentally review and simplify the investment Business Regulations
• Revise the Disciplinary Bye-laws
• Extend the CPD Annual Declaration to include Ethics confirmations
• Identify an appropriate risk based regulatory regime for members who are not in practice
• Develop and introduce monitoring structures for Insolvency Monitoring in ROI, and for Tax Compliance
• Implement new monitoring regime to take account of the Irish Anti Money Laundering requirements
• Work with IAASA in the transfer of the monitoring of listed company audits.

However the document which will be of most interest to practising member firms is the Quality Assurance Operating Plan for 2011 as it outlines which types of firms are more likely to be the focus of monitoring and changes to the activities that will be monitoring in future.  This document indicates that:-

• It is CARB’s intention in 2011 to separate the monitoring visits from quality review visits (although firms may elect to have the two carried out at the same time);
• That there will be an extension to the activities included in the Quality Review Visits with the inclusion of management consultancy and corporate finance;
• That tax compliance monitoring will be developed in 2011 and included from 2012 onwards;
• That insolvency monitoring in ROI will be implemented in 2011;
• That Investment Business Monitoring visits will be stepped up in quantity to meet the targets set by the Financial Regulator (CARB are hoping to achieve a target of 74 firms);
• That the area in relation to Anti Money Laundering requirements will be supervised in ROI through both the Annual Return and through monitoring visits.  This regime will include book keepers, tax advisers and trust and company service providers where there are members of CAI, as is required by legislation.  Where the designated person within the firm is a non member this will also include supervision of that person.

In relation to Audit Monitoring,

the primary change is that the monitoring function of listed company audit work is to be transferred to IAASA

• However those firms with audit listed clients will remain within a 3 year cycle for all other audit monitoring
• All other firms will fall into a 6 year cycle as required
• Firms with a large number of audit clients and no previous audit monitoring visits will be targeted to receive visits before the end of May 2011.

CARB is required to achieve 166 audit monitoring visits in 2011 and a further 65 quality review visits.

Michelle Kane,
OmniPro,
Block D, Iveagh Court,
Harcourt Road,
Dublin 2.
01 4110000
mkane@omnipro.ie
www.omnipro.ie