New law aims to end non-compliance

TOUGH new legislation to end the culture of non-compliance with company law is expected to be in place by the summer.

Institute of Chartered Accountants in Ireland president Adrian Burke will, in his keynote speech to the institute’s Annual Practice Conference today, warn that the outcome of new legislation such as the Companies (Auditing and Accounting) Bill 2003, and the Irish Auditing & Accounting Supervisory Authority (IAASA) could have far-reaching effects on the future of self-regulation and on the structure of the profession itself.

Trade and Commerce Minister Michael Ahern yesterday told the conference he hopes the changes in company law will be place by the summer or at the very least by the autumn.

The new legislation is based on the work of the Working Group on Company Law Compliance and Enforcement sometimes known as the McDowell Report.

The new law provides for the establishment on a statutory basis of an independent regulatory body, the Irish Auditing and Accounting Supervisory Authority (IAASA).

The authority will be given significant powers to discharge its functions and will have its own dedicated professional and administrative staff. It will have the power and resources to:

Intervene in the disciplinary process of the accountancy bodies where it deems it necessary.

Investigate directly cases of pubic interest.

Apply to the courts to compel the directors of a company to amend accounts that are not in line with generally accepted accounting standards.

Require accountancy bodies to amend their ethical rules and their disciplinary and investigation procedures.