2014年-世界发展银行全球_Jamaica_Report_on_the_Observance_of_Standards_and_Codes___Accounting_and_Auditing_49页_635kb

Summary of Jamaica: Report on Observance of Standards and Codes - Accounting and Auditing (June 13, 2014)

Core Content

This report evaluates Jamaica's accounting and auditing practices in the context of its economic reform program and alignment with international standards. It is part of a joint initiative by the World Bank and the IMF, designed to strengthen the international financial architecture. The report provides an overview of Jamaica's current financial reporting environment, identifies strengths and weaknesses, and offers policy recommendations to improve transparency, accountability, and the quality of financial information.

Main Viewpoints

• Jamaica's Economic Context:
  Jamaica is the largest English-speaking Caribbean country with a population of 2.7 million. It is a relatively small, open economy with a per capita GDP of about $5,500 in 2013. Over the last three decades, the economy has faced challenges in growth and competitiveness due to high debt levels and related risks.

• Economic Reform Objectives:
  The reform program aims to address economic and external vulnerabilities, enhance financial sector resilience, and improve growth efficiency. This includes strengthening public finances, reforming the financial sector, and improving the business environment.

• Accounting and Auditing Standards:
  Jamaica adopted IFRS and ISA in 2002, aligning with international practices. However, compliance with these standards is uneven, particularly among small and medium enterprises (SMEs) and small and medium-size practices (SMPs).

• Institutional Framework:
  The Public Accountancy Board (PAB), established in 1968, regulates the accountancy profession. It licenses Registered Public Accountants and has initiated practice monitoring through ACCA. ICAJ, the Institute of Chartered Accountants of Jamaica, is a key professional body that also plays a role in setting standards and providing CPD.

• Professional Accountancy Education and Training:
  ICAJ has a membership of around 1,244 professionals and 3,958 students. It collaborates with ACCA and has agreements with UWI to assess students' knowledge of local taxation and business law. However, there is a need for more comprehensive training in international standards.

• Regulatory Oversight:
  The Bank of Jamaica (BOJ), Financial Services Commission (FSC), and Jamaica Stock Exchange (JSE) are responsible for oversight. However, their capacity to monitor and enforce compliance needs to be enhanced, especially with the increasing complexity of financial instruments and standards.

• Public Interest Entities (PIEs):
  The report emphasizes the need to define PIEs and SMEs with appropriate differential reporting frameworks to reduce unnecessary burdens on entities and improve financial accountability. The definition of micro entities is also recommended.

• Corporate Governance and SOEs:
  State-Owned Enterprises (SOEs) are a significant part of Jamaica's formal economy, with 194 SOEs. The Ministry of Finance and Planning (MOFP) has issued a Corporate Governance framework, but its implementation remains a challenge. Delinquency in audit reporting is an issue that needs to be addressed through stronger oversight and sanctions.

Key Recommendations

A. Short-Term Reforms (1 to 2 years)

1. Define PIEs and SMEs:
   Establish clear definitions and a differential financial reporting framework based on size, stakeholders' interest, and potential systemic impact.

2. Strengthen ICAJ Capacity:
   Enhance ICAJ's technical support for international financial reporting and auditing standards.

3. Institutionalize Practice Monitoring:
   Strengthen the PAB secretariat and institutionalize regular practice monitoring in collaboration with ICAJ and ICAC.

4. Improve SOE Monitoring:
   Continue to closely monitor SOEs and apply sanctions for delinquent reporting. Amending legislation to report delinquent SOEs to the Attorney General is recommended.

5. Enhance Regularity Capacity:
   Strengthen the capacity of all regulators, including JSE, to monitor and enforce compliance with financial reporting requirements.

B. Medium- and Long-Term Reforms (3 to 6 years)

6. Expand ICAJ Membership and Image:
   Foster membership among public sector accountants and enhance awareness of the profession. Full compliance with IFAC's Statement of Membership Obligations (SMO) is required.

7. Legal Requirements for Audit Reports for Tax Compliance:
   Consider accepting audited financial statements for tax purposes to promote financial discipline and audit compliance.

8. Central Repository for Audit Reports:
   Establish a central repository for audit reports of private unregulated companies and include this in the draft Public Accountancy Amendment Act.

9. Review/audit Interim Financial Reports:
   Mandate auditors to review or audit interim financial reports of listed companies before publication, as recommended by the JSE.

Key Information

• Currency: Jamaica Dollar (JAD), with USD 1 = JAD 111.17 (as of June 13, 2014).
• Key Institutions:
  • PAB: Regulates the accountancy profession and licenses Registered Public Accountants.
  • ICAJ: Professional body that sets standards and provides CPD.
  • FSC and JSE: Regulators responsible for oversight of financial institutions and listed companies.
• International Standards:
  • IFRS: International Financial Reporting Standards.
  • ISA: International Standards on Auditing.
  • IPSAS: International Public Sector Accounting Standards.
• Challenges:
  • SMEs and SMPs struggle with IFRS compliance.
  • Delinquency in SOE audit reporting is a concern.
  • ICAJ has limited control over non-members, leading to differential regulation and potential arbitrage.
• Support from International Bodies:
  The report is aligned with Jamaica's "Vision 2030" and the World Bank Group's 2014–17 Country Partnership Strategy (CPS). It draws on global experiences and good practices in financial reporting and auditing.

Conclusion

The report highlights the need for a more robust institutional framework, improved professional capacity, and stronger regulatory oversight to enhance the quality and reliability of financial reporting in Jamaica. It also emphasizes the importance of aligning with international standards to support economic growth and attract investment. The proposed action plan outlines both short-term and long-term reforms aimed at addressing these challenges and improving the overall financial accountability and transparency in the country.