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10Nov2005 - Ian McPhee speech - CPA Aust Vic President's Boardroom Lunch

Issues at CPA Australia needing investigation and/or review.
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JWheldon
Posts: 327
Joined: Wed May 24, 2017 6:43 pm

10Nov2005 - Ian McPhee speech - CPA Aust Vic President's Boardroom Lunch

Post by JWheldon » Sat Oct 07, 2017 12:11 am

Have attached a speech from Ian McPhee given to CPA Australia Victoria President's Boardroom Lunch on 10 Nov 2005.

page 3 "If our audits highlight anything, it is the importance of organisations being self-aware as to risks and effectiveness of these controls to mitigate these risks. By this l mean that organisations should understand their strengths and weaknesses, and the mechanisms they have in place to obtain assurance that their performance is on track and key risks are being properly managed. Some of the more significant issues arising from audits over the years underline the importance of good governance and management practices"



It provides in interesting incite to the audit procedures, but issues which should be undertaken by auditors of large Not-For Profit associations, Charities and Unions.
Attachments
McPhee_cpa_australia_victorian_presidents_boardroom_lunch 10 Nov_2005.pdf
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JWheldon
Posts: 327
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Re: 10Nov2005 - Ian McPhee speech - CPA Aust Vic President's Boardroom Lunch

Post by JWheldon » Tue Oct 17, 2017 12:34 am

Here is another interesting speech from Ian Mcphee given in 2012 titled " Theme 2: Increased complexity of accounting and auditing standards and the role of Auditors-General in standard setting for the public sector" and from 2014 " Panel discussion - What does it mean to use public money well?" Although they relate to government, it could easily be applied to the Not-For Profit Sector, Unions and Charities.

"Over the last decade, we have seen good progress in the development of stronger institutional arrangements for the making of standards for financial reporting and auditing, and in the quality of the standards themselves. This progress has been made against the background of the corporate collapses of the early 2000s and the global financial crisis, and a greater recognition of the economic benefits of a strong set of globally-accepted standards. In 2003, a report commissioned by the International Federation of Accountants (IFAC) made recommendations for restoring public confidence in financial reporting based on 3 assumptions, namely: a need to improve the financial reporting supply chain at all points, the importance of the integrity of individuals and institutions, and a need for international action to ensure that changes made at a national level produce both improved and more consistent practices.2"

"In acknowledging these substantial developments, more remains to be done. There will be different views of the scope of general purpose financial reporting and auditing, and which standards should be a priority for the next few years. The on-going challenge for financial reporting standard-setters is to make standards that require information that is relevant to and faithfully represents the real world, and is understandable to users, with auditing standard setters needing to have regard to these developments. These are challenges that Supreme Audit Institutions can, and do, help address in a variety of ways by contributing to the setting of standards. SAIs are uniquely positioned in terms of their experience and knowledge of government and the wide range of government entities, and of developments in public administration."

"Conclusion
There will be challenges for all parties in the financial reporting “supply chain” from the scope of financial reporting by governments and their agencies expanding up to and beyond accrual financial statements into performance indicators and compliance, and possibly integrated reporting.
In these developments, it is important that standard setters ensure that the information they require is information that is relevant, provides a faithful representation of the real world and is understandable to users. They also need to weigh up the costs of reporting across entities of different types and sizes.
There are benefits in having a transaction-neutral approach between the private and public sectors, where appropriate, and in having developments in auditing standards that complement developments in financial reporting. As global resources, these standards help drive better quality financial reporting.
Quality financial reporting by governments and their agencies is important to good government. SAIs are well placed to contribute to the development of standards that foster quality in reporting and auditing. It is a role that SAIs should embrace."

"Australian Government Leadership Network – Annual Conference Brisbane, 31 July 2014
Ian McPhee PSM
Panel discussion -What does it mean to use public money well?
Introduction
The answers to some questions are straight forward but the answer to this one is not, as there are many factors that need to come together to deliver outcomes that use public money well.
They include:
(a) government acting in the best interests of the nation
(b) government policies being soundly based and well-targeted
(c) policies being soundly implemented, their performance monitored, and any required adjustments made, and
(d) institutional arrangements working well, particularly those designed to provide transparency in relation to the performance of government policies.
So let us consider these four components."

"The effective implementation of government policy
If government policies are not implemented well, the benefits of the new policy measure are at risk and the resource costs are most likely to be higher than anticipated.
To effectively implement programs requires sound governance, including risk management, the right skills and capability, sound administrative systems and processes and, importantly, performance measures and monitoring to inform agencies whether programs are making the difference, or on track to making the difference, that government expected; and being delivered efficiently.
Various reports of my office highlight programs not implemented well with soft spots in risk management, particularly monitoring new or changing risks, and in measuring the impact of government programs."

"Concluding comments
Using public money well requires the effective implementation of soundly based government policies developed having regard to wide considerations of public interest, close monitoring of performance and appropriate institutional arrangements to provide accountability for results.
At the best of times, it is not straight forward to achieve the alignment of the required components – more of a journey, but with a worthwhile destination."

"It is important, however, that we learn from the past and draw on Australian and international experience so that using public money well is a common objective, whether official roles entail providing policy advice or implementing government decisions"
Attachments
McPhee_What_does_it_mean_to_use_public_money_well_2014.pdf
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McPhee_Increased_complexity_accounting_and_Auditing_Standards_2012.pdf
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Brett Stevenson
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Re: 10Nov2005 - Ian McPhee speech - CPA Aust Vic President's Boardroom Lunch

Post by Brett Stevenson » Tue Oct 17, 2017 6:45 am

Great finds jwheldon.
A couple of things stand out.
1. One of the three recommendations to restore 'public confidence in financial reporting' is the 'importance of the integrity of individuals and institutions'. Therein lies a neat summary of the failure of CPA Australia over the last decade.
And the irony of it all is that the recommendations come from the IFAC which has been represented by Richard Petty with Alex Malley as his adviser. I'm not too sure whether to laugh or cry!
And I must admit that whenever I read or hear the word integrity used these days especially in the context of finance and accounting I tend to have an unhealthy cynicism.
2. Management speak certainly has taken hold. I reckon there needs to be a translation of this into everyday common sense language which both reduces the words and speaks plainly. I think Don Watson would have a field day with this material. I think Jeff Hughes was a keen student of this.

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Brett Stevenson
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Re: 10Nov2005 - Ian McPhee speech - CPA Aust Vic President's Boardroom Lunch

Post by Brett Stevenson » Tue Oct 17, 2017 7:03 am

3. And a third one that stands out like a sore thumb is in relation to a fundamental role of accounting. Let me provide the quote
The on-going challenge for financial reporting standard-setters is to make standards that require information that is relevant to and faithfully represents the real world, and is understandable to users, with auditing standard setters needing to have regard to these developments
Again the CPA Australia example with its financial reporting and annual reports parroting about integrated reporting would top the polls in terms of obfuscation and misleading reporting of the real world.
Just think of the way they ‘hid’ the reality of remuneration, or of the financial disaster of CPAA Advice, or the dodgy membership numbers and global growth exaggerations, or the marketing spend.
If anything the CPA Australia annual reports were an example of hiding or distorting the reality of what was happening at CPA Australia. And don’t get me started on the cream puffery of their integrated reporting pontifications. Oh the irony of it all.
And to reflect on the speaker of these words and his current position as head of the IRP with its pretty dismal and what I would call anaemic preliminary report into CPA Australia does give one pause for thought.

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