2003年-世界发展银行全球_Republic_of_Mauritius___Accounting_and_Auditing_17页_507kb

Summary of the REPORT ON THE OBSERVANCE OF STANDARDS AND CODES (ROSC) for Mauritius

Core Content

This report evaluates the observance of accounting and auditing standards in Mauritius as part of the World Bank and IMF joint initiative. It highlights the transition from local standards to international standards, the current institutional framework, and the challenges in ensuring compliance and audit quality.

Main Points

I. Introduction

• The report is part of the World Bank and IMF's Reports on the Observance of Standards and Codes (ROSC) initiative.
• Mauritius has a population of about 1.2 million and a GDP per capita of approximately US$3,900.
• The Stock Exchange of Mauritius lists 44 companies with a total market capitalization of about US$1.5 billion.
• The financial sector includes 10 commercial banks, 13 offshore banks, 23 insurance companies, 10 investment companies, and 6 unit trusts.
• Family ownership dominates major companies, and many list shares due to government incentives.
• The global business sector, especially offshore companies, is a significant part of the economy.
• The Companies Act 2001 mandates the use of IAS and ISA for most companies, excluding small private ones.
• Category-1 global business license holders may use IAS or other international standards, while Category-2 are exempt from financial reporting.

II. Institutional Framework

A. Statutory Framework

• Financial reporting is transitioning to full compliance with IAS.
• The Companies Act 2001 requires IAS compliance for all companies except small private ones.
• ISA is mandatory for all public and private companies, except small private ones and Category-2 global business license holders.
• The Companies Act 2001 does not apply to sociétés, unit trusts, and businesses under the Trust Act 2001.
• The Registrar of Companies has the authority to exempt companies from certain reporting requirements.
• The Banking Act 1988 and Insurance Act 1987 have not been updated to align with the new standards.
• The Bank of Mauritius guidelines may conflict with IAS, especially in areas like loan loss provisioning.
• The Listing Rules 2001 are being updated to align with the Companies Act 2001.
• Shareholders appoint external auditors, and auditors can be automatically reappointed.
• The Companies Act 2001 requires auditors to give an opinion on the financial statements' true and fair view.
• The forthcoming Banking Bill aims to align banking audit requirements with the Companies Act.

B. The Profession

• There is no local professional accounting body in Mauritius.
• Most practicing accountants and auditors are members of foreign bodies like ACCA and ICAI.
• About 1,200 fully qualified members from foreign bodies are active in the profession.
• The MAAS Committee is responsible for setting accounting and auditing standards.
• The MAAS Committee has issued 11 ISA-based guidelines before the Companies Act 2001.
• Since the Companies Act 2001, the MAAS Committee has stopped issuing new accounting standards and now focuses on small private companies.
• There is no national institution to regulate auditors or enforce ethical standards.
• The Companies Act 2001 does not require compliance with the IFAC Code of Ethics for Professional Accountants.
• Auditors in Mauritius are not legally required to have professional indemnity insurance, but their professional bodies abroad mandate it.

C. Professional Education and Training

• There is no national requirement for auditors to have a "practice certificate."
• The level of knowledge of IAS and ISA varies among auditors and audit firms.
• Practitioners with ACCA qualifications have different training backgrounds compared to chartered accountants.
• The lack of local monitoring may allow auditors without proper qualifications to practice.

D. Setting Accounting and Auditing Standards

• The MAAS Committee is responsible for setting standards and has followed a due process for their development.
• After the Companies Act 2001, the MAAS Committee shifted focus to small private companies.
• There is a lack of common interpretation of IAS among preparers and auditors.
• Segment reporting, related party transactions, and asset impairment have led to interpretational difficulties.

E. Ensuring Compliance with Accounting and Auditing Standards

• The Office of the Registrar of Companies verifies compliance with the Companies Act 2001 but lacks qualified staff.
• The Companies Act 2001 includes provisions for penalties against misleading financial statements, but enforcement is not yet active.
• The Bank of Mauritius monitors banks for compliance with financial reporting and prudential regulations.
• The Financial Services Commission (FSC) is strengthening its monitoring and enforcement mechanisms.
• The Stock Exchange of Mauritius has the authority to enforce financial reporting and disclosure rules, including censuring or suspending companies.
• There is no statutory agency responsible for monitoring and enforcing auditor code of conduct and independence rules.

Key Information

• Accounting Standards: IAS are now mandatory for most companies, but there are still interpretational issues and inconsistencies with local guidelines.
• Auditing Standards: ISA are mandatory, but compliance and enforcement mechanisms are underdeveloped.
• Regulatory Gaps: Lack of a national professional body and enforcement mechanisms for ethical standards and audit quality.
• Legal and Practical Challenges: Conflicts between local guidelines and international standards, and the burden of compliance on small enterprises.
• Policy Recommendations: Establish a professional accounting body, align banking and insurance regulations with IAS and ISA, and create a Financial Reporting Council to monitor and enforce compliance.

Policy Recommendations

• Establish a Professional Accounting Body: To ensure better regulation and enforcement of international standards.
• Enact New Legislation: To address inconsistencies and conflicts between local and international standards.
• Create a Financial Reporting Council: To develop, disseminate, and monitor compliance with IAS and ISA.
• Enhance Professional Education and Training: To improve the understanding and application of IAS and ISA among practitioners.
• Align Banking and Insurance Regulations: With IAS and ISA to ensure consistency in financial reporting.
• Improve Enforcement Mechanisms: To ensure that auditors and companies comply with standards and face appropriate consequences for noncompliance.