Annual_Report2014

3 CHAIRPERSON’S STATEMENT
Confidentiality of IAASA’s work
Brendan Walsh, Chairperson
Introduction
This is IAASA’s ninth Annual Report. I am submitting it
to the Minister for Jobs, Enterprise and Innovation,
Mr. Richard Bruton TD, in accordance with section 22(1)
of the Companies (Auditing and Accounting) Act 2003
(‘the Act’). The Chief Executive’s Review summarises the
principal activities undertaken by IAASA during 2014 to
fulfil its mission. The remainder of this Report details
this work. In my Statement, I would like to highlight
some significant developments that occurred during the
year 2014.
Audit reform
During 2014, proposals to reform the audit market were
finalised and approved by the European Parliament.
These will come into force from June 2016 following
their transposition into Irish law. The reforms are focused
on restoring public trust and confidence in the audit of
financial reports and stipulate a number of measures
designed to enhance auditor independence, auditor
reporting, to increase choice in the audit market and to
improve audit supervision. Of particular significance to
IAASA is that the reforms mandate that the inspection
of the quality of audits of Public Interest Entities (‘PIEs’)
must be undertaken by an independent authority, such
as IAASA. Given that such inspections are currently
conducted by the PABs under IAASA’s supervision, this
is a significant change in the Irish regulatory framework
and one which has long been advocated by IAASA. I
welcome the finalisation of these audit reforms and
look forward to meeting the challenges that lie ahead in
implementing them.
As reported in previous years, providing information to
the public regarding IAASA’s work in as transparent a
manner as we would like is difficult given the constraints
of IAASA’s current statutory confidentiality requirements.
Except in restricted circumstances, the Authority has
been prohibited by law from disclosing information to
the public regarding its activities. IAASA has engaged
in discussion concerning this issue with the Department
of Jobs, Enterprise and Innovation (‘the Department’)
throughout 2013 and 2014 and I am pleased to report
that the Companies Act 2014 (‘the 2014 Act’), when
commenced, will lessen the confidentiality provisions
currently in place. Additionally, and as outlined in the
Chief Executive’s Review, IAASA has also provided
advice to the Department concerning the introduction
of a statutory instrument to amend other confidentiality
constraints relating to IAASA’s accounting enforcement
work. Both developments will allow greater scope for
communication and publication where it is considered
appropriate for the performance of IAASA’s functions.
Liquidators
The 2014 Act, when commenced, will introduce
qualification requirements for liquidators for the first
time in Ireland and will require that such liquidators have
professional indemnity insurance at a level and on such
terms as may be prescribed by IAASA. This Act also
confers on IAASA specific responsibilities in relation
to the registration of certain individuals as liquidators
and for considering the statutory recognition of certain
professional bodies who may wish to confer liquidator
status on their members.
It is positive that these general measures are being
introduced. IAASA continues to work to secure specific
statutory functions and powers for the Authority to be
able to appropriately discharge this role. Unfortunately,
there is no comprehensive framework under the 2014
Act for IAASA or another statutory body to supervise,
regulate or discipline liquidators once registered.
IAASA has made its views on this matter known to
the Department, along with suggestions as to how
these provisions of the Act might be appropriately
implemented. The Authority will remain available to
advise the Minister as required. During 2015, IAASA
will continue to work towards the development of
a registration system for relevant applicants and to
establish criteria regarding professional indemnity
insurance for liquidators.