Welcome to this edition of Technical Roundup. In recent developments, the Dept of Enterprise, Trade and Employment has published the Digital Services Bill 2023 which will provide for the full implementation in Ireland of the EU Regulation on a Single Market for Digital Services and the International Auditing and Assurance Board issued the new International Standard for the Audits of Less Complex Entities on 6 December 2023. Read more on these and other developments that may be of interest to members below. Financial Reporting The Financial Reporting Council (FRC) has issued FRED 85 Draft amendments to FRS 101 Reduced Disclosure Framework – 2023/24 cycle. Every year, the FRC carry out a review of the FRS 101 standard to consider amendments made by the International Accounting Standards Board (IASB) to their standards, and whether such changes should result in an amendment to FRS 101. In FRED 85, the FRC are proposing minor changes to FRS 101 to ensure consistency with IAS 1 Presentation of Financial Statements. The FRC has published an insight report “Structured digital reporting – 2023 insights” which highlights some areas for focus for companies when producing their annual financial report in a structured digital format under FCA Rules. This includes some examples of best practice in the areas of tagging, usability & design and process. The FRC has issued version 2.0 of Technical Actuarial Standard 300: Pensions (TAS 300). The IFRS Foundation has released its November 2023 monthly news summary, which summarises their news items and events during the month. The IFRS Interpretations Committee (IFRIC) has issued its November 2023 update which summarises decisions made by the Committee in its public meetings. This includes details of some tentative agenda decisions on climate-related commitments under IAS 37 and disclosure of revenues and expenses for reportable segments under IFRS 8. The International Accounting Standards Board (IASB) has published a summary of its project on extractive activities which considered whether to amend or replace IFRS 6 Exploration for and Evaluation of Mineral Resources. The IASB has published a webcast which provides some insight into the forthcoming IFRS Accounting Standard for Subsidiaries. The standard is expected to be issued in the first half of 2024. EFRAG, the European Financial Reporting Advisory Group, has published its final comment letter in response to the IASB’s Exposure Draft- Annual Improvements – Volume 11. The UK Endorsement Board has also published its comment letter and feedback statement on the Exposure Draft. EFRAG has published its November 2023 update which summarises public technical discussions held and decisions taken during the month. The Pillar Two tax rules that will apply to companies with consolidated revenue over €750m are contained in the Finance No2 Bill that is making its way through the Oireachtas. In relation to the financial reporting implications of the Pillar Two tax rules, IAS 12 Revised and FRS 102/101 revised now set out financial reporting disclosure requirements for those companies. Assurance and Auditing The Financial Reporting Council (FRC) has published its annual inspection findings for Tier 2 and Tier 3 audit firms and a number require ‘significant improvement’. The findings outline that of the audits reviewed, 38% required only limited improvements, 24% required more than limited improvements and a further 38% required significant improvements. The FRC identified deficiencies in the audit of judgements and estimates, and going concern, both of which require audit teams to demonstrate robust professional scepticism. Firms must demonstrate improvement including investing in their audit methodology, human resources and audit quality functions, learning from things that went wrong or went well, and seeking to embed a culture that recognises and prioritises audit quality. The FRC is taking a number of actions to improve resilience and competition in the PIE audit market. The FRC has announced their areas of focus for 2024/25. The includes priority sectors are: Construction and Materials Food Producers Gas, Water & Multi-utilities Industrial Metals and Mining Retail These are for both corporate reporting reviews and audit quality inspections. ISA for LCE Following approval at their September 2023 meeting, the IAASB issued the new International Standard for the Audits of Less Complex Entities on 6 December 2023. Where it is adopted, or permitted, the standard is effective for audits of financial statements for periods beginning on or after December 15, 2025, (i.e. 2026 calendar year audits) with early adoption being permitted and encouraged. The standard has not yet been adopted for use in Ireland or the UK. The standard can be downloaded from the IAASB website. Sustainability The International Sustainability Standards Board (ISSB) have been providing updates on their activities at COP 28. These include; Their planned future cooperation with the International Organization for Standardisation towards effective communication about sustainability-related risks and opportunities. Details of the growing number of Organisations and jurisdictions who have committed to advancing the adoption or use of the ISSB’s climate-related reporting at a global level. An announcement that Emmanuel Faber will continue as ISSB chair until the end of 2027. Details of the progress made in advancing global sustainability disclosures since the establishment if the ISSB was announced at COP 26. The International Sustainability Standards Board has provided details of some new and updated resources coming into effect on 1 January 2024. These are intended to help companies apply the ISSB Standards IFRS S1 and IFRS S2. The IFRS Foundation has launched the IFRS Sustainability Knowledge Hub which seeks to support users of the ISSB standards. This is intended to help auditors, investors, regulators and stakeholders as they begin their reporting journey under the ISSB standards. IFAC have announced plans to revise the International Education Standards to bring greater focus to sustainability reporting and assurance, given the evolving role of accountants in the area of sustainability. Sanctions/Anti-money laundering The UK’s National Crime Agency and National Economic Crime Centre have issued an alert to financial institutions and other members of the UK regulated sector warning that Russia is trying to procure UK sanctioned goods through intermediary countries.  Sanctions imposed on Russia as a result of its invasion of Ukraine have had a significant impact on its ability to purchase products, including military supplies, on international markets. The alert provides information to UK businesses on common techniques suspected to be in use to evade sanctions on the export of high-risk goods, which Russia is using on the battlefield in Ukraine. The European Council and Parliament have reached a provisional agreement on creating a new European authority for countering money laundering and financing of terrorism (AMLA) - the centrepiece of the anti-money laundering package, which aims to protect EU citizens and the EU's financial system against money laundering and terrorist financing. Other News The Credit Union (Amendment) Bill 2022 has recently been sent to the President for signature. Click here for a government press release where the Minister for Financial Services, Insurance and Credit Unions welcomed the proposed amendments to the legislation which she said aim to bring about significant reforms for the credit unions sector in Ireland and represents a very significant piece of legislation that will have far-reaching positive implications for the credit union sector in the years to come. In other credit union news, the Central Bank of Ireland has issued their December Credit Union News publication which includes a reminder to all credit unions on key financial  considerations and other matters for consideration at year end including impairment reviews of assets, liquidity management, systems of control, cybersecurity and operational resilience (including outsourcing) and Lending Framework Review with an expectation of publishing analysis of the review in H1,2024. The Dept of Enterprise Trade and Employment recently published  the Digital Services Bill 2023, which will provide for the full implementation in Ireland of the EU Regulation on a Single Market for Digital Services. Click here for a press release giving more details on the Bill and the EU Regulation commonly referred to as  the Digital Services Act. The EU Regulation establishes a pioneering regulatory framework to protect EU users of digital services and their fundamental rights online. The press release notes that the Irish Digital Services Bill is a technical bill, drafted to address specific obligations on Member States of the EU to give effect to the supervision and enforcement provisions of the EU Regulation. The Bill does not add to or amend the obligations on online platforms under the EU Regulation. Those obligations have direct legal effect in all Member States of the EU and do not require any implementing measures in national law. In its recent publication, IFAC’s Professional Accountants in Business group discuss how accountants are leading and driving sustainability and digital transformation agendas. Some areas discussed in this article include; The accountancy profession’s role in driving higher-quality, decision-useful sustainability-related information The use of AI in transitioning businesses and the nature of work Strategies for nurturing future leaders For further technical information and updates please visit the Technical Hub on the Institute website.                                ~          Happy Christmas        ~

An interest in tax took Meath native Aoife Smyth to Vancouver via Dublin. We caught up with Aoife to learn more about her journey, and about her involvement in the Vancouver member chapter. 1. Where did you grow up and where do you live now? I grew up in Dunshaughlin, County Meath. I lived in Dublin for about ten years when I went to college in Trinity, did my training contract in KPMG and worked in a medium sized practice after qualifying. I moved to Vancouver in June 2022 and have applied for permanent residency. 2. What made you choose to become a Chartered Accountant? In college I really enjoyed a course called Economics of Policy Issues, in particular, our studies around the economic and social considerations for "optimal taxation". When I researched careers in tax, I thought that BEPS was interesting so I applied to KPMG to do a graduate placement in tax, and then went on to do my traineeship. 3. Can you tell us a little about how you got to where you are today – both the geographical journey and your career path. I spent my "J1 summer" in Portland, Oregon, and really fell in love with the Pacific North West. It is absolutely beautiful, and I find the pace of life that little bit slower. After that, I always knew that I wanted to live abroad for a time again, but I wanted to get my qualification and some work experience before making the move. When I relocated to Vancouver, I went from working in tax into working transfer pricing, which has been a great move for me. I had considered moving into transfer pricing a few times over the years, but could never decide when it was the "right time". I guess if you uproot your life, it's as good a time as any to also make a career move! I have been really enjoying working with the BDO Canada Transfer Pricing team – everyone comes from different backgrounds, bringing something different to the team, and everyone is really supportive.  4. What do you value most about your membership of the profession and how do you think those benefits can be used to support the economy and society? I really value that my qualification is internationally recognised, so it helped with my move to Vancouver. Lots of other professions need to re-train in Canada. 5. As a member living away from Ireland, can you talk to us about how your membership has been of value to you living overseas?  As the ACA is an internationally recognised qualification, it means that your work experience and qualification can be easily understood by employers in Canada. Although I haven’t needed to, you can also get the CPA credentials through the mutual recognition agreement between CPA Canada and Chartered Accountants Ireland. 6. What were the most significant/noticeable differences you encountered doing business and networking away from home and back in Ireland?  I haven't found networking too different here. There are both informative sessions and casual networking events organised through CPA Canada. Separately, there are also Irish business networks. The biggest change for me was moving away from the professional network I had started to build in Dublin and having to start to meet people again in a new city. I think one of the most organic networks you build is with your peers in your training contract, so it is hard to move away from them! I was recently involved in "re-starting" the Vancouver Chapter of Chartered Accountants Ireland after a Covid 19 hiatus, and we were delighted to have around 30 Institute members come out for our first get-together. We are looking forward to meeting more people – current residents of the region and new arrivals – and hosting more events in 2024! Aoife Smyth is a Transfer Pricing Senior Accountant with BDO Canada, based in Vancouver. 

With tech-enabled fraud on the rise in Ireland, businesses must carefully assess and manage potential risks, writes Sara McAllister Ireland is a hub for data storage and technology organisations and, as such, we are at the fore of innovation and transformation. There is a flipside, however. As this industry grows and technology evolves, so too do risks associated with fraud. Businesses and organisations in Ireland have become a greater target for fraudulent activity by criminals looking to exploit vast amounts of data created, shared and uploaded every single second. The challenge now is how best to identify, monitor and manage this risk. The National Risk Assessment 2023, published by the Irish government earlier this year, points to Ireland being especially vulnerable due to the scale of technological infrastructure developed here. Its exploitation by bad actors could cause significant disruption. A rise in the volume of fraudulent attacks carried out in Ireland speaks to the appetite of those looking to exploit weaknesses in infrastructure, industry or organisations. With this heightened focus on Ireland, business and organisational leaders here may find themselves under pressure to assess, manage and prepare for risks attached to operations, both in-house and outsourced. Artificial intelligence As new technologies come on stream, the focus on risk reduction will need to move at a faster pace. Advances in artificial intelligence (AI) have helped scale businesses via real-time automation, but this technology comes with its own risks. Ultimately, it is a double-edged sword. On the one hand, AI has been a game-changer in areas like audit and forensics, allowing businesses to deploy ‘needle in a haystack’ algorithms to identify anomalies and exposures. This is one of the reasons we are seeing an improvement in the detection of fraudulent activity. On the other hand, AI has allowed bad actors to identify new opportunities to carry out fraudulent attacks, penetrating weaknesses in the new and novel AI technology businesses are learning to use. Hybrid and remote work Most businesses have introduced remote and hybrid working processes in recent years, and many will continue to review these policies in line with changing business needs. A key consideration in this context is the risk associated with social engineering threats, which rely on human error and can be much more difficult to detect than other fraud-related risks. Where employees work remotely, evidence suggests they are less likely to consider the legitimacy of communications they receive by email, for example, and may be more inclined to respond to fraudulent requests that appear to have been sent by colleagues or superiors within their organisation, creating vulnerabilities across entire business networks as a result. Security training and awareness is the first line of defence against social engineering, yet many organisations fail to sufficiently consider the risks associated with employees working on-site and remotely. Fraud trends Several other trends are raising concern for businesses, too, beyond AI and hybrid working. Synthetic identity theft uses legitimate and fabricated information to exploit vulnerabilities and remains problematic for businesses as it is increasingly difficult to detect. Account takeover fraud remains prevalent and, as the number of personal online and social media accounts increase, so too do attacks by criminals attempting to gain access to personal data or bank details, often through stolen information. Crypto currency fraud, albeit less mainstream, also fundamentally exploits technology control weaknesses to attempt to steal coins, such as Binance Smart Chain, Ethereum and Bitcoin. Necessary risk assessment The heightened risk landscape is part of a changing cybersecurity picture where digital technology is constantly being attacked and weaknesses are identified and accessed by criminals to exploit data and information for their own gain. Fraud risk must always be a key factor for consideration when managing shared infrastructure, data breaches, preventing unauthorised access and engaging with third-party providers, among others. Industry and political stakeholders are acutely aware of the challenges in this space. Without the proper risk assessment, governance and control mechanisms in place, any single attempt at fraud could potentially put a business at the centre of a perfect storm with a highly damaging aftermath.  Sara McAllister is Partner and Head of Business Risk Services at Grant Thornton

Female representations on Irish boards is up, but more progress is needed in the key decision-making roles of CFO, CEO and Chair, writes Meliosa O’Caoimh Female representation on the boards of Irish companies is improving, but progress is slower at the senior leadership level – particularly in key decision roles, such as Chief Financial Officer, Chief Executive and Chair.  This is according to the new annual report of the Balance for Better Business Review Group, which shows a 21 percent rise in female representation in ISEQ-listed companies over a five-year period. Now in its sixth year, the report also puts the current proportion of women on the boards of ISEQ 20 companies at 39 percent, exceeding the 33 percent target set for 2023.  The percentage of women on boards across other listed companies stands at 28 percent, also above the 25 percent target set for 2023. Private companies with Irish ownership have remained steady at 22 percent since 2021, up from 17 percent in 2019. Seeing a consistent year-on-year increase in gender balance on boards marks important progress, and the companies driving this change should be proud. Companies with more diverse boards are shown to outperform those with less diversity.  Progress at the senior executive level is also critical to both business success and safeguarding the board-level talent pipeline, however. Achieving gender balance in senior roles across all areas of decision-making is dependent on robust and business-led strategies, including succession planning, career pathways and the monitoring of progress through targets and data. Balance for Better Business is an independent business-led review group established by the Government. Its latest annual report included the results of research commissioned by the 30% Club with the support of the Department of Enterprise, Trade and Employment.  Two roundtable discussions on both the financial services sector and executive search were held as part of its research. The financial services roundtable brought together representatives from industry to focus on the challenge of achieving greater gender balance in roles with profit and loss or revenue-generating responsibilities.   Research in Ireland revealed that challenges emerge as early as a professional’s very first career choices and can have an impact across an organisation’s career processes and work design. Specific actions highlighted in this research include: extending graduate recruitment gender targets to include graduate first-role placements; mandated job rotation as part of early career development; and  replacing outdated stereotypical business development approaches with initiatives that are more appropriate to a modern workforce and gender-balanced customer base.   The research also highlighted the value of tracking targets and gender progress across each business area, rather than simply focusing on the company average, to demonstrate where action can be taken.  The executive search roundtable, hosted in partnership with Ibec, focused on the current processes for Chair and board appointments as well as C-suite appointments at the highest level.  Here, it was found that large private companies are more likely to have succession plans in place, while smaller organisations are less likely to benefit from existing succession plans.  Key recommended actions for boards and C-suites included:  adopting the 30% Club/Ibec Resourcing Code as the standard for nomination committees covering board and executive leader appointments;  advocating for succession planning in all roles across all boards; and  the adoption of ‘pathway to board’ type career resources.  Meliosa O’Caoimh is Chair of 30% Club Ireland

As relations with the West continue to cool, China is facing economic challenges reminiscent of the Irish economy in 2008, writes Cormac Lucey Tensions are growing between the China and the US as the latter leads the West in a sharp reversal of a policy of openness and commercial integration, which continued despite concerns about military espionage and intellectual property theft.  Now, the US is reducing its interactions with China, and a wave of reshoring/friendshoring is underway in the West. Under current President Xi Jinping, China has been picking territorial fights with its neighbours and Xi has reportedly asked his military to complete preparations by 2027 to seize Taiwan by force.  Meanwhile, senior Chinese political and business leaders are disappearing suddenly with alarming frequency and non-Han ethnic minority groups, such as the Uyghurs and Tibetans, have been subject to terrible oppression.  The Chinese economy is not faring much better. When I look at China’s economic position, I think we may now be witnessing ‘peak China’.  First, the country’s enormous property/debt bubbles are beginning to deflate. Coming into 2024, China is in a similar position to Ireland circa 2008. Its economic underpinnings are dangerously fragile, the first tremors of deflation are being felt and the authorities are insisting that everything is okay.  Over the past 15 years, China’s total debt levels (public plus private) have doubled relative to economic output (GDP).  According to Numbeo, a website that analyses the cost of living across different countries, rent yields in Beijing range from 1.45 percent (city centre) to 1.69 percent (suburbs). These yields are way below the lowest levels witnessed in Ireland at the peak of our property bubble.  They are lower than Chinese interest rates, meaning that buy-to-let landlords using debt to fund their purchases will face interest charges that exceed their rental income (negative carry).  Thanks to its now defunct ‘one child per family’ policy, which ran from 1979 to 2015, China faces a demographic implosion over the coming decades. The UN forecasts that its population will decline from 1.4 billion this year to 1.3 billion by 2050 – and below 800 million by 2100.  Today, China faces the same demographic and debt-deflation challenges that confronted Japan three decades ago.  For all the messiness and dysfunction of the West, democracy does force a society’s problems onto the political agenda rather than allow them to be suppressed, and it facilitates innovation over stagnation.    Cormac Lucey is an economic commentator and lecturer at Chartered Accountants Ireland

As we prepare to usher in the New Year, three Chartered Accountants tell us about the biggest changes and challenges they have faced in their professional lives over the past 12 months Michelle Hawkins  Head of Business Advisory FPM 2023 has certainly been an interesting year!  As Head of Business Advisory at FPM, I support both public sector and private clients as they navigate these difficult times. A key challenge in 2023 has undoubtedly been the unprecedented rise in interest rates, resulting in difficulties accessing and servicing finance.  Clients increasingly require support in this area. To address this, our organisation established a dedicated Funding Solutions Division designed to help clients renegotiate their banking and loan commitments. The talent shortage and skills gap that our clients have experienced in the past year has been among the biggest in history.  It’s hard to believe that, in the current economic climate, lack of available talent is the number one challenge keeping businesses from growing and innovating. In response, we launched a Virtual Finance Function to support businesses that need to strengthen or fully outsource their finance department.  Another challenge this year has been the need to help businesses prepare for the impact of the Windsor Framework, which came into force in October. We are fortunate to have customs experts within the AAB Group with which we recently merged, whose knowledge and skills have greatly supported clients adapting to the new regime. John Morgan  CFO Dale Farm Coop I will most certainly view 2023 as a pivotal year in my career.  After spending 20 enjoyable years in a plc environment with BT, I took a leap into the unknown, joining Dale Farm Coop as Chief Financial Officer – switching not just to a different business model but also a very different sector.  Cash management has been crucial in both roles. During my time working with a plc, good cash management was about ensuring that we delivered our quarterly cash commitments to the city.  At Dale Farm, it’s about ensuring that our debt levels are controlled while paying a milk price that’s as competitive as possible. On reflection, the main challenge so far in this role has been managing the balance between profit and milk price. As a coop, our primary objective is to pay our members the most competitive milk price we can.  To achieve this objective, we need to generate a certain profit level to fund working capex/capex requirements and ensure we pay a competitive milk price over the long term. Managing this balance is critical to the role of CFO at Dale Farm.  Communicating directly with our board, leadership team and members to explain why we need to make a certain level of profit has been a key focus for me in 2023.  My second biggest priority since joining Dale Farm has been the management of interest costs and working capital levels.  Due to our investment strategy, debt levels have increased and, as interest rates have doubled over the last 12 months, this has required greater attention on working capital management. Educating the business on the parameters and importance of working capital has been a priority for me.  I would advise anyone considering a move between industries and business models to embrace the opportunity. I’ve found the change invigorating and I’m pleasantly surprised at how the core skillset of a Chartered Accountant can be applied so well in such different environments. Brian McNamara  Managing Director SwiftFile Customs When the post-Brexit trading environment kicked in almost three years ago, much of the initial focus was on keeping goods moving whereas ensuring compliance was not necessarily given the same level of attention by importers unfamiliar with customs obligations.  After a relatively relaxed initial approach from the Revenue Commissioners, 2023 has seen a significant increase in the number of companies selected for customs audits. With this, we have certainly seen a heightened awareness of the importance of managing customs risk. With Revenue audits now becoming the norm for importers and the potential fines and penalties that go with them, this is a trend I expect to see continue. October 2023 also saw the introduction of the Carbon Border Adjustment Mechanism (CBAM), the EU carbon tax on imports.  While not a core customs issue, the CBAM reporting requirements for importers of iron, steel and cement (initially) are particularly onerous.  Staffing continues to be a challenge in our industry. The economy has slowed in 2023, and there have been some high-profile job losses in the technology industry. As with other sectors, however, there are industry-specific reasons for staffing challenges in customs clearance.  Thirty years of single market membership has meant a shortage of customs professionals. Now that the UK has left the EU, it will take time to build the knowledge base on customs in Ireland. In the meantime, we address this issue by providing comprehensive in-house training.  Thankfully, everything stops moving over the Christmas period. This will allow us all to take a well-earned break and come back ready to meet challenges as they present themselves in 2024.

The introduction of the Corporate Sustainability Reporting Directive marks a pivotal moment in the evolution of corporate reporting in the EU, but it will bring challenges for all involved, writes Daniel O’Donovan In an era where businesses are increasingly being scrutinised for their impact on the environment, society and their governance practices, the European Union (EU) has taken a leading role internationally by introducing the Corporate Sustainability Reporting Directive (CSRD).  The CSRD is due to be transposed into Irish law before mid-2024. Following its transposition, mandatory reporting requirements will become effective for, among others, financial years commencing on or after: 1 January 2024 for public interest entities in scope of EU non-financial reporting rules (with more than 500 employees); 1 January 2025 for other larger companies and public interest entities (with more than 250 employees); and 1 January 2026 for listed public interest SMEs, with ‘opt out’ possible until 2028. This is a pivotal moment in the evolution of corporate reporting across the EU, bringing with it significant challenges for all involved, not least for reporting entities, their audit committees and assurance providers. What are the key challenges?  While the CSRD is a welcome framework for enhancing transparency and accountability in corporate sustainability reporting – reflecting the EU’s commitment to fostering sustainable and responsible business practices – it introduces three significant challenges for business: First, the breadth of information that relevant businesses will be required to report under the 12 European Sustainability Reporting Standards (ESRS) introduced by the CSRD; Second, the need to implement the systems required to gather and record reliable sustainability data and information; and Third, the need to provide assurance over the sustainability reports required by the CSRD. Breadth of information to be reported The ESRS, developed by the European Financial Reporting Advisory Group (EFRAG), aim to enhance the consistency, comparability and reliability of sustainability reporting among European reporting entities.  The scope of the ESRS is expansive, encompassing various elements that collectively contribute to a comprehensive understanding of an organisation’s environmental, social and governance (ESG) performance.  The key components driving the breadth of information required in this reporting are the: sustainability topics;  reporting boundary; double materiality concept; and  number of datapoints for disclosure within the ESRS. Sustainability topics The ESRS require disclosures about the following topics: climate change, pollution, water and marine resources, biodiversity and ecosystems, resource use and circular economy, own workforce, workers in the value chain, affected communities, consumers and end-users, and business conduct. As can be seen from this list, these are broad topic areas. The ESRS standards for each of these topics specify further subtopics in respect of which disclosures must be given. Furthermore, in respect of each of the topics and subtopics, disclosure is required about aspects of the topics as shown in the table below.  Reporting boundary The reporting boundary required by the ESRS is in stark contrast to what reporting entities are familiar with in the context of the financial reporting boundary used to produce annual financial statements, being within the reporting entity or group. The ESRS, however, require a reporting boundary that considers the entire value chain, from suppliers to end consumers, as shown in the figure below: This inclusive perspective ensures that the environmental and social impacts of a business are accurately captured, providing stakeholders with a complete picture of the organisation’s sustainability efforts, but it places a demanding requirement on reporting entities from a data collection standpoint. Double materiality Reporting entities in scope of the CSRD will be required to report on a double materiality basis. This means that they will have to report on impacts on and risks to them from a changing climate and other ESG matters (referred to as “financial materiality” as it is consistent with what entities report in the financial statements). In addition, they will report on the impact the entity itself might have on climate and other ESG matters (referred to as “impact materiality”). When compared with reporting in the financial statements, this concept doubles the challenge for reporting entities as all ESG topics must be considered from both perspectives. Gathering and assessing information and data about the reporting entity’s impact on the breadth of ESG topics is a new frontier for corporate reporting and one that the majority in the corporate reporting ecosystem have no experience of. Datapoints for disclosure It is clear that the scope of the information to be disclosed under the ESRS is far broader than the information to be reported in the financial statements. However, to underline this, the ESRS outline specific datapoints that reporting entities should disclose to provide transparency and facilitate comparability. As recently as October, EFRAG released a draft List of ESRS datapoints – Implementation Guidance, which includes all 1,178 disclosure requirements in the sector-agnostic ESRS published to date. The datapoints are standardised metrics that allow for consistency in reporting and enable stakeholders to assess the sustainability performance of different reporting entities. For instance, in the environmental domain, entities may report on their carbon footprint, energy consumption and waste generation. Social datapoints could include diversity and inclusion metrics, employee turnover rates, and health and safety performance. This new frontier of corporate reporting will generate tangible benefits for society at large and result in greater public interest therein but will not be without data capture challenges in the near future.  Sustainability information systems Given the significance of the breadth of sustainability information to be reported, the transposition of the CSRD into Irish law will have a profound impact on the information systems of entities within its scope. Moreover, the scale of the endeavour for those entities that will be required to report in early 2025 on the calendar year ended 31 December 2024 is enormous in terms of what must be achieved within a timeframe that is less than 18 months away.  Such entities need to determine what sustainability matters are material using the double materiality concept and are therefore required to be included in their sustainability report and start gathering, collating, aggregating and sorting the data in relation to 2024, which will be reported in early 2025.  Reporting entities will need to establish or enhance integrated data systems that allow for the collection and management of sustainability data. This could involve integrating sustainability data within existing enterprise resource planning (ERP) systems to ensure data consistency and accuracy. Additionally, tools may be needed, such as a materiality assessment tool to help systematically evaluate the importance of various sustainability information.  As stakeholder engagement is a crucial part of a materiality assessment, systems or tools that can help track and manage interactions with stakeholders, ensuring that their perspectives and concerns are considered in the reporting process, will be necessary. Developing or strengthening internal controls and policies related to sustainability reporting information systems will be essential. Reporting entities will need to create processes and controls to ensure the accuracy, completeness and reliability of sustainability data, which will be sourced from all areas of the organisation and well beyond the finance function.  Reporting entities that are successful in achieving this will be better positioned to facilitate an independent assurance provider’s examination of their sustainability report. Assurance over sustainability reports Initially, the CSRD requires an independent assurance provider to express an opinion based on a limited assurance engagement as regards the compliance of the sustainability reporting with the requirements of this Directive, including compliance with the ESRS, the process carried out by the undertaking to identify the information reported pursuant to the ESRS, and compliance with the requirement to electronically tag the sustainability report. In later years, after an initial period, reasonable assurance over the sustainability report may be required. For reporting entities, facilitating a limited assurance engagement in the year of implementation of such a significant suite of sustainability reporting standards will require additional resources and does not come without the increased possibility of qualification given the complexity of the ESRS and the potential immaturity of reporting systems. The challenge for independent assurance providers is that at present no assurance standard is in existence that governs the performance of such an engagement.  The International Audit and Assurance Standards Board (IAASB) is developing a standard and has released an exposure draft – International Standard on Sustainability Assurance 5000 – that seeks to address the performance of limited and reasonable assurance engagements over sustainability information.  The exposure daft is open for comment at present and a final standard is not expected until the second half of 2024.  While the development of the standard is welcome, the timeframe is extremely tight, and it is widely acknowledged that the exposure draft does not provide sufficient clarity in relation to the performance expectation of an independent assurance practitioner when performing a limited assurance engagement compared with a reasonable assurance engagement.  In the face of such unprecedented uncertainty, independent assurance providers may struggle to deliver high quality limited assurance engagements.  Challenges ahead The rate of recent extreme weather events in Ireland and elsewhere in Europe, and their impact on supply chains, provides a clear mandate to take better care of our environment. Most people are therefore likely to welcome the intent behind the CSRD’s introduction of sustainability reporting.  Sustainability reporting by entities will be on a basis far broader than financial statements. Additional resources will be needed to address the challenges outlined in this article, but time is running out fast; the time to act on these challenges is now.  Furthermore, the successful implementation of the CSRD regime in Ireland and across the EU requires considerable pragmatism and support from policymakers, standard-setters and regulators.  The new “gold rush” in which companies will seek to lead will be a race to capture data, integrate systems and assure sustainability reports. Undoubtedly, this marks a new frontier in corporate reporting – the ESG Rush! Daniel O’Donovan is a partner with KPMG and leads the firm’s Audit and Assurance Methodology team. He is also Chair of the Chartered Accountants Ireland Assurance and Audit Technical Committee

The publication of the National Philanthropy Policy will mark an important milestone in the evolution of this type of proactive giving in Irish society With a new National Philanthropy Policy due to be published later this month, the Department of Rural and Community Development will set out plans to create an ‘enabling environment’ for philanthropy in Ireland. For Philanthropy Ireland (PI), the representative body for the sector here, the policy’s publication marks a very important milestone in the evolution and perception of this type of proactive giving in Irish society on the cusp of the New Year. PI defines philanthropy as the act of giving money, goods, time or effort to support a charitable cause, usually over an extended period of time and in regard to a defined objective. “Irish philanthropy comes in different shapes and sizes, from small community grants to men’s sheds and new mothers’ groups to larger advocacy projects with a national remit,” explains Eilis Murray, Chief Executive of Philanthropy Ireland. “No matter what it looks like, philanthropy has touched every corner of Ireland, but it is still a relatively new concept here because our wealth is relatively new.  “Irish people are generous and support many social causes, but compared to the UK and Europe, philanthropy here is underdeveloped. Greater support from the State and public awareness can change that. “For context, there are about 8,000 grant-making organisations in the UK whereas, in Ireland, there are only around 100.” For Philanthropy Ireland, which has been working with Minister Joe O’Brien and the Department of Rural and Community Development to create the new National Policy on Philanthropy, its publication will be a welcome development. “We hope it will encourage more people with wealth to give and, equally, encourage those advising them to consider the potential of philanthropic giving or leaving a legacy,” says Murray.  For Liam Lynch, Tax Partner with KPMG and past President of Chartered Accountants Ireland, one of the biggest benefits of philanthropy is its potential to bring about positive change with real and lasting social impact. “Philanthropy provides the critical risk capital for projects and initiatives that benefit society and improve opportunities and outcomes for those who are disadvantaged in various ways,” Lynch says. “Some people are of the view that philanthropy shouldn’t exist and, instead, the State should administer all the money needed to fund good causes through the tax system. I don’t agree.  “There is a point of view and perspective philanthropy brings to the table that promotes innovation in a way the State and local government are just not set up to do. “There are services the State should be providing as standard to support social good. Philanthropy is about building on this in a strategic, outcome-driven way that can have a very positive impact on society.” For those who decide to become involved in philanthropic giving, it is often a deeply personal endeavour and one that reflects their personal convictions and values, according to PI. “Philanthropy can make a difference in so many areas, from tackling educational disadvantage and supporting employment opportunities, to health-focused initiatives – mental health, children’s or older people’s health, for example,” says Lynch. “Philanthropic giving can go towards promoting sustainability and the environment or protecting Irish culture and the arts. This is just the tip of the iceberg. The potential is enormous.  “That is why I would like to see more awareness and discussion of philanthropy, and philanthropists, in Ireland. I think we are generally very aware of the role of philanthropy internationally.  “My question is, why don’t we celebrate our own philanthropists as much and make a concerted effort to recognise the goodwill they are putting into doing good in society?” Frank Gannon – Lynch’s colleague at KPMG Ireland and a Partner in the firm’s Financial Services Group – sees similar benefits in philanthropic giving.  “For me, philanthropy means fulfilling the wish to give something meaningful to those who will benefit,” he explains. “Many people associate philanthropy with monetary donations, but there is much more to it than that.” Chartered Accountants Ireland’s members and trainees are well-placed to get involved in different types of philanthropic giving, Gannon says.  “Our members and trainees have all been educated to a certain level. Sharing our knowledge, information and know-how with those who have not had the same opportunities – and, in particular, those in socially deprived areas – can be a powerful tool,” he says.   “Social capital matters and a lot of Chartered Accountants have large networks of contacts. These networks can be leveraged to transform lives. Giving someone from a deprived area the opportunity to interview for a job could change the trajectory of their life with the positive knock-on effect extending to their family and wider community.”  For those whose philanthropic interest lies in monetary giving, meanwhile, Philanthropy Ireland offers a wealth of advice and information on what you need to know to get started. “There are many forms of monetary philanthropy, which is often considered within the overall context of wealth management and estate planning,” it advises. “Individuals, families and corporates often set up their own foundation or they link in with an intermediary philanthropic organisation that can support them in their grant-making decisions and provide governance and compliance support.” To find out more about Philanthropy Ireland, the organisations and initiatives it supports and the different philanthropic options on offer, log on to philanthropy.ie

As Chartered Accountants prepare for 2024, Ross Boyd outlines key measures to stay one step ahead in a challenging climate Whilst the dawn of a New Year brings with it a sense of hope and often optimism, accountants across the world should brace for a difficult 2024.  I established my practice over a decade ago, having earned my stripes for about 15 years before that, but in all that time I’ve never experienced such volatility and uncertainty.  The year that’s gone has presented the most complex economic test of a generation with the impact of two wars, Brexit and the pandemic completely transforming the business landscape.  I commend my fellow Chartered Accountants for powering through and continuing to do their best for their clients, and their own teams.  Chartered Accountants across the island will already be preparing for a tough 2024, aware of the implications of the current economic climate. The accountancy sector faces additional hurdles, including a skills shortage, retention issues, the continued rise of artificial intelligence and digital tools, and ongoing consolidation across the sector.  While changing business taxation is a big issue in the North, talent and technology are two common themes facing businesses across the island on the cusp of the New Year. Change continues at a relentless pace, and we must pause, embrace and adapt to remain relevant. Here are the key areas I recommend you focus on now, so that you can grow your business and continue to provide trusted and expert counsel to your clients.  Talent Labour shortages, paired with the capacity pressures these shortages cause, are likely to be the most pressing issues restricting growth across many sectors in 2024. Unfortunately, the war on talent is a trend our own sector will continue to battle too.  To put it bluntly, the sector’s image needs reinvention if it’s to continue attracting and retaining talent.  And to put it even more bluntly, investing in human capital is non-negotiable – after all, talent and growth are entirely correlated. As employers, we must adopt a two-pronged approach here.  First, we must invest in existing employees to support their continued contribution to the sector. I would advise any practice to objectively assess their employees’ skill sets and put the necessary plans in place to help them develop.  These development plans should look beyond ‘number crunching’ and financial recording to include a broader set of responsibilities, such as analysing forecasts, identifying emerging trends and networking.  It is crucial we ensure that the role of the Chartered Accountant isn’t limited or constrained, and that it is clearly positioned as that of strategic advisor. Second, we must focus on creating the type of organisation – and providing the kind of leadership – people want today.  Organisations that prioritise diversity, inclusion and flexibility are proven to have higher employee retention, and this is becoming even clearer post-pandemic as Gen Z becomes more present in the workplace.  Now aged between 11 and 26, this generation will account for 27 percent of the workforce by 2025.  At RBCA, we have spent a lot of time developing our graduate programme so that we can give our trainee recruits every opportunity to thrive, including supporting their interpersonal development. We also recently invested in a new office in Belfast to provide a physical environment that supports productivity and learning, and our annual Away Days continue to be invaluable to the culture of RBCA.  Technology  We have all come to understand the importance of digital tools in recent years and it is critical that, in 2024, we continue to use technology to improve both efficiency and security.  At RBCA, we moved to cloud computing in 2011 and we recently invested in new cloud technology, successfully tackling our tech stack. Some ill-advised pundits would argue that accountancy’s future is limited in our increasingly digital world, but our experience is that new accounting technologies have been complementary to our work.  Technology will never replace our profession, however. Why? Because, in my opinion, people will always buy into people.  Relationships and quality communications are the greatest tools at the disposal of today’s Chartered Accountant, providing that crucial competitive edge.  Often, we are so focused on our clients’ businesses and their success that we don’t focus enough on the resilience of our own, but it’s vital that we harness the passion and commitment that exists across the sector to thrive in the New Year.  Ross Boyd is founder and director of RBCA, a Belfast-based Chartered Accountancy 

From education and the next generation, advances in technology and the evolving role of the accountant, to business and the economy, what can we expect in the New Year? As we look ahead to the New Year and the opportunities and challenges it will bring for society and the economy, our District Society Chairs give us their take on what lies ahead for the profession in 2024. Brendan Brophy, Chair of the Young Professionals Committee The accountancy profession is poised for transformative developments in 2024 and young professionals will find themselves at the forefront of this dynamic landscape.  The coming year promises a paradigm shift in the role of accountants in business.  Beyond the traditional domains of financial reporting and compliance, there is a growing emphasis on strategic financial management. Young professionals are expected, not only to interpret financial data, but also leverage their insights to drive business decisions. Our ability to communicate financial information in a clear and compelling manner is becoming as crucial as the technical expertise itself. In Ireland, where the business ecosystem is marked by resilience and innovation, the role of accountants is expanding to encompass a broader spectrum of advisory services.  Accountants are increasingly being called upon to provide strategic insights that guide organisations through economic uncertainties and market fluctuations. The expectation is for accountants to be proactive contributors to organisational growth, acting as trusted advisors who understand the intricacies of both finance and business operations. Advancements in technology continue to reshape the profession and we can expect to see this trend accelerate in the year ahead.  Automation and artificial intelligence are streamlining routine tasks, allowing accountants to focus on higher-value activities such as analysis, interpretation and strategic planning. As a young professional, staying abreast of these technological developments and embracing them as tools for efficiency will be paramount. Morna Canty Ahern, Chair, Chartered Accountants Ireland Midwest Society An accountant will always have a seat at the table and, for some, the shift in the traditional role of accountant is the ghost of Christmas past. Currently, we find ourselves as a profession in high demand but facing a lack of supply.  The many routes to qualify as an accountant – along with the Government’s renewed focus on apprenticeships – means that our sector can now actively address the skill shortage we face and meet the demand for high-quality professionals through education.  Education is the ‘gateway to the future’ in building the Chartered brand, but it does not end with our qualification. Education is a cycle, a continuous process of learning and acquiring knowledge pre- and post-qualification. Chartered Accountants are always seeking opportunities to learn and our education must emphasise and support the reality of our role today, and not the traditional role of the ghost of Christmas past. Through technology, our role now is to provide leadership in business, rather than simply counting costs.  Despite this, fewer young people are choosing a career in accountancy and this is because the role of the modern accountant is not accurately portrayed to students at second and third level.  We welcome the commitment by the Department of Education to review the second-level accounting syllabus.  A focus on promoting the true working life of today’s accountant through educational campaigns by our members will help the next generation to visualise a future in our profession. Becoming an accountant is a commitment to lifelong learning and, as we approach 2024, we need to develop educational access programmes in partnership with third-level institutions so we can engage and encourage younger generations to become accountants.  Our members are natural mentors, often contributing at many levels to their local economy and offering support to their communities.  A renewed focus in 2024 on engagement with the Institute and our District Societies will help to deepen these relationships and strengthen the value attributed to the role of the Chartered Accountant in communities around the country.  As a profession, we are not just ‘about numbers’; our unique ability to strategically shape organisations through trusted advice and guidance contributes far beyond the balance sheet. James Fox, Chair, Chartered Accountants Ireland Cork Society It has been great to see the theme of #NextGen at the forefront of Chartered Accountants Ireland in 2023, building on previous discussions with national policymakers regarding the potential changes required to the Leaving Cert accounting syllabus. I see this process as being a key driver for promoting the profession, keeping up to date with advances in technology and encouraging younger generations to pursue a career in accountancy. The future of accountancy as a career is a hot topic and one I expect to see further discussion on in 2024.  Having spoken to many students and second-level teachers since I became Chair of our Cork Society, I can see that there is still work to be done to change perceptions of what a career in accountancy is really like. In 2024, I will continue to listen to our members, to key stakeholders in second- and third-level education and to the next generation themselves, to see how Chartered Accountants Ireland can remain not just relevant, but at the forefront of shaping the national dialogue and influencing policymakers. It is important that we clearly demonstrate how Chartered Accountants continue to play a crucial role in industry, practice and many other sectors, and in the midst of rapid developments in technology. A career as a Chartered Accountant is varied, interesting and dynamic, and the academic curriculum and internship programmes on offer to the younger generation must reflect this. I would also hope, in 2024, that further light is shone on the supports small-to-medium sized practices need as we move forward. They play a vital role at a local and national level and are at the coalface of our profession, supporting entrepreneurs and training new members. It is vital that these practices get sufficient support to grow and thrive in the future, particularly with regard to technology, and I hope that this is high on the agenda nationally in 2024. Des Gibney, Chair of Chartered Accountants Ireland Leinster Society Despite the economic impact of COVID-19 and the negative impacts of high inflation, soaring energy costs, rising interest rates and over €2 billion in warehoused Revenue debt, business insolvencies in Ireland remain at the same level as 2019, which itself marked a historic low. The sectors bearing the brunt of these economic pressures currently include construction, hospitality and retail. I predict that the commercial property sector in Ireland will also come under significant pressure over the next 12 to 18 months due to a combination of higher interest rates and the prevalence of hybrid working. Between 2012 and 2018, insolvencies averaged 1,000 per annum. Recent figures indicate that we can expect 600 corporate insolvencies this year, so we are not faring too badly, relatively speaking, despite the macro-economic situation worsening since 2018. I believe there is a combination of reasons for the low level of corporate insolvencies we are currently seeing, including uptake of formal restructuring procedures such as the Small Company Administrative Rescue Process (SCARP) and examinership. Generous Government supports made available over the COVID period have helped.   The Government has also played its part by providing struggling SMEs with the SCARP option, which can save a company where it is insolvent but has a viable business. It is a cheaper and faster process than examinership. However, since the legislation was enacted in 2021 there have been approximately 50 SCARP appointments. Thirty companies were approved, nine failed and the balance were restructured outside the process. This level of uptake is disappointing. However, SCARP is still in the early stages and we must remember that uptake of the examinership legislation brought in back in the nineties was also initially very low. Having advised companies on insolvency and restructuring matters for decades, my experience has been that owners and directors tend to put off taking formal action until they are left with no other option. In some regards, particularly in the case of family-owned businesses, I understand this reluctance. The most common source of corporate pressure comes from either a creditor or the prospect of the company imminently running out of cash and being unable to meet their wage bill. Once matters reach this stage, the options available to the company reduce significantly.  To avoid this, my advice to business advisors, directors and shareholders is to understand the statutory responsibilities of directors when the company is approaching insolvency and the implications this may have for their other business interests or employments.  The next step is to explore the options available to the company by seeking advice early from an experienced insolvency practitioner. Marion Prendergast, Chair of Chartered Accountants Ireland Northwest Society The prospects for the Northwest region in 2024 are undeniably positive, drawing on my first hand experience as a member of the Northwest Society and my role in the regional public sector. In the wake of the COVID-19 pandemic, there has been a notable influx of professionals choosing the Northwest for work across diverse industries, setting the stage for robust economic growth. As Chair of the Northwest Society, I’ve had the privilege of connecting with numerous members who have either returned from overseas or opted to move here from bustling urban areas.  The common thread in these decisions is the pursuit of better work-life balance, reduced commuting times and a focus on family support – benefits the Northwest region provides. In my role as Head of Finance at Sligo University Hospital, I’ve witnessed the successful recruitment of highly skilled expatriates choosing to return home. Unlike in the past, when we might have competed with larger city hospitals, the appeal of the Northwest is now a major draw for individuals relocating to the region and contributing to the local economy. Nevertheless, like any region, the Northwest faces challenges that demand attention. Our road and rail networks require substantial investment, with the N17 urgently needing upgrading as the main connection to Ireland West Airport. Additionally, improved road connections to Northern Ireland and faster rail links to the capital are essential for accommodating the needs of remote workers effectively. Addressing the housing shortage, particularly for families, requires increased investment. While these challenges are widely acknowledged and are high on the Government’s agenda, their resolution is crucial for the Northwest to retain its appeal to high-calibre talent. As members of Chartered Accountants Ireland, we are well-equipped to play a pivotal role in finding solutions. Our diverse membership spans various industries and functions, and our local District Societies serve as vital connectors, especially for those engaged in remote work.  The view from London The members of the London Society Committee were pleased to see an increased appetite for in-person events throughout 2023 and we expect this trend to continue, writes Michael Gilmartin, Chair of Chartered Accountants Ireland London Society. In 2024, however, we expect demand for in-person events to be driven not by pent-up demand post-COVID but by a softer labour market in which companies may start to mandate more compulsory days in-office. The UK economy is forecast to grow by a modest one percent in 2024 and there remains much uncertainty globally.  Given the financially challenging times, it is vitally important that we continue to be a force for good within the Irish community in and around London. Our biggest challenge is trying to engage with members who are based in the Greater London Area.  This isn’t unique to the London Society, but with a population in excess of 9.5 million people in Greater London, we will always face intense competition vying for our members’ attention. The interests of our members continue to evolve to reflect those of wider society and we will continue to offer novel, less traditional events in 2024.  Michael Gilmartin is Transformation Director, Dentsu International The view from Northern Ireland There’s a lot to be positive about in Northern Ireland, particularly when it comes to the creativity, innovation, drive and resilience in the business community, writes Paul Millar, Chair of Chartered Accountants Ireland Ulster Society. We have entrepreneurs who have a positive vision for Northern Ireland and who have the drive to realise this vision.  There are significant sectoral strengths in areas such as digital and ICT, life and health science, advanced manufacturing, fintech, agri-food and the creative industries – and we have great renewable energy potential. Twenty-five years on from the Good Friday/Belfast Agreement, there is also a great level of interest from US investors in supporting businesses in Northern Ireland. In recent months, we’ve seen the US Special Envoy to Northern Ireland, Joe Kennedy III, lead a trade mission of 50 US executives to Northern Ireland.  There is a clear message that Northern Ireland has something to offer – growth potential, a skilled workforce and unique dual market access to the UK and EU. We could be on the verge of something special. The US is Northern Ireland’s largest source of foreign direct investment, supplying 45 percent of projects in the last 20 years. One-third of all foreign direct investment and 51 percent of the jobs created have come from the US.  A growing interest in further investment could be a great sign. It could be a catalyst to boost everything else within our society, from health and education to housing and wellbeing. Of course, there are challenges. The cost-of-living crisis, and the cost of doing business, continue to be difficult for everyone. Just about every sector is facing a skills shortage and when we need leadership the most, we continue to face a democratic deficit at Stormont. Public services are in a difficult position. There are substantial pressures on public sector finances and significant budget overspends to deal with. We need a devolved administration back up and running at Stormont to deal with these issues. At the time of writing, there have been positive signs that perhaps the Executive and Assembly suspension could end soon. We urgently need this to be the case. Paul Millar is Chief Executive of Whiterock Finance

The Institute has issued revised Anti-Money Laundering (AML) Supervision Regulations, trust and company service providers (TCSPs) and bookkeepers, Ireland (AML Supervision Regulations) replacing and renaming the Money Laundering Supervision Regulations.  The revised AML Supervision Regulations are effective from 1 January 2024. To whom do the AML Supervision Regulations apply? The AML Supervision Regulations provide for the Institute’s AML supervision of entities which are within the Institute’s statutory remit as an AML supervisor in Ireland, but which are not subject to the Institute’s Public Practice Regulations.  In general terms, these entities are TCSPs and/or bookkeepers which count Institute members amongst the principals of the entity.  Whether a particular TCSP or bookkeeper is within the Institute’s AML supervisory remit or that of another competent authority is determined, in accordance with AML legislation and agreements between the competent authorities, with reference to the composition of the principals at the specific TCSP or bookkeeper entity.  The AML Supervision Regulations provide further information in this regard. What changes do the revised AML Supervision Regulations bring for Institute registered TCSPs and bookkeepers? Revisions to the AML Supervision Regulations include: A revised introduction and new guidance at Appendix 1 to enhance clarity as regards scope of the AML Supervision Regulations; New requirement for a registered TCSP and/or bookkeeper to ensure that every principal is either a member of the Institute or has been granted AML affiliate status by 1 January 2025.During 2024 the Institute will engage with the Money Laundering Compliance Principals at registered TCSPs and bookkeepers to facilitate compliance with this requirement; New requirement for a registered TCSP and/or bookkeeper to make a declaration, on behalf of the entity, acknowledging the entity’s obligations under Institute Bye-Laws and Regulations and AML legislation. A mechanism to ensure that the Institute can remove a persistently non-compliant entity from its supervisory remit.Where the Institute cannot continue to be responsible for AML supervision of a TCSP or bookkeeper by virtue of a decision of an Institute regulatory Committee or Disciplinary Body to de-register (or refuse registration to) the entity, it is not appropriate for a member of the Institute to remain as a principal at that entity.The revised AML Supervision Regulations provide that an Institute member ceases to be an Institute member where he/she continues to act as a principal at a registrable TCSP and/or bookkeeper within 90 days of that entity being refused registration or de-registered by a regulatory Committee or a Disciplinary Body of the Institute. Guidance: Revised AML Supervision Regulations Guidance is available on the Institute’s website. Previous editions: The revised AML Supervision Regulations replace the previous edition of the Money Laundering Supervision Regulations which remain available to read in the Institute’s online archive of Regulations.  

Revised Public Practice Regulations – effective 1 January 2024 The Institute has issued revised Public Practice Regulations with effect from 1 January 2024.    Institute members engaged in public practice comply with the Public Practice Regulations.  Key revisions are summarised below: Anti-money laundering (AML) supervision: The revised Public Practice Regulations include explicit reference to the Institute’s role as AML supervisor for practising firms.    While firms are familiar with AML supervision and already engage with the Institute in this regard, the revised Public Practice Regulations introduce some new regulatory obligations in this regard.  In particular, the revised Public Practice Regulations: Include a new chapter addressing AML supervision; Define an ‘AML supervised firm’; Require an AML supervised firm to ensure that each of the firm’s principals is either a member of the Institute or has been granted AML affiliate status by 1 January 2025. During 2024 the Institute will engage with the Money Laundering Compliance Principals at AML supervised firms to facilitate compliance with this requirement; Require all AML supervised firms to make a declaration, on behalf of the firm, acknowledging the firm’s obligations under Institute Bye-Laws and Regulations and AML legislation.This declaration will be sought as part of the firm annual return process going forward; Include explicit ongoing fit and proper requirements for beneficial owners, principals and relevant managers at AML supervised firms. Professional indemnity insurance (PII) requirements for authorised investment business firms, Ireland Regulation 7.18A of the Public Practice Regulations reflects a new Central Bank of Ireland requirement for firms authorised by the Institute for investment business (IB) to have specific minimum professional indemnity insurance (PII) which is ringfenced for IB claims.   The Institute has written directly to the IB compliance principals outlining the revised PII requirements.    This topic is covered in more detail in the August edition of the Professional Standards Regulatory Bulletin. Simplified regime for potential ‘dual- PC’ holders Chapter 5 of the revised Public Practice Regulations provides that an Institute member engaged in public practice is exempt from the requirement to hold an Institute practising certificate (PC) where that individual is a member of, and holds a PC from, another specified accountancy body.    While these dual-membership cases are infrequent, the revised approach streamlines regulatory processes between the accountancy bodies, simplifies compliance for individuals and minimises the risk of regulatory gaps or duplication.  Institute PC regime applies only to Ireland and the UK The definition of practising certificate has been revised to state that the Institute’s PC regime applies only to public practice in Ireland and the UK.  This is a clarification and not a change to the Institute’s PC regime.  Where members engage in public practice in jurisdictions other than Ireland or the UK the member complies with any local requirements regarding public practice in that jurisdiction.  Guidance: Revised Public Practice Regulations Guidance is available on the Institute’s website. Previous editions: The revised Public Practice Regulations replace the previous edition of the Public Practice Regulations which remain available to read in the Institute’s online archive of Regulations.  

Welcome to this edition of Technical Roundup. In recent developments, IAASA has issued a letter to the CEOs of Recognised Accounting Bodies (RABs) setting out their expectations for the initial approval of existing statutory auditors to be Sustainability Assurance Service Providers (SASPs). In other news, the European Council has adopted a regulation creating the European Single Access Point (ESAP) which will give companies more visibility towards investors, and open up more financing opportunities.  Read more on these and other developments that may be of interest to members below. Financial Reporting The International Accounting Standards Board (IASB) has launched a consultation on improved accounting requirements for financial instruments with characteristics of debt and equity. In the exposure draft, the IASB proposes; to clarify the underlying classification principles of IAS 32 to help companies distinguish between debt and equity; to require companies to disclose information to further explain the complexities of instruments that have both debt and equity features; and to issue new presentation requirements for amounts—including profit and total comprehensive income—attributable to ordinary shareholders separate to the amounts attributable to other holders of equity instruments. The IASB has also released a webcast which gives an overview of the forthcoming standard for Subsidiaries without Public Accountability. The IASB has issued its November 2023 update which highlights preliminary decisions made by the board during their meetings on 13th to 15th November. In their November podcast, members of the IASB Board provided some insights from the recent meetings, including discussions on the progress and direction of the following projects; Business Combinations under Common Control; Post-implementation Review of IFRS 9—Impairment; and Provisions The IFRS Foundation has published a video which explains how IFRIC, the IFRS Interpretations Committee helps maintain and support consistent application of IFRS Accounting Standards; what happens when the Committee receives an application question; and how it works with the International Accounting Standards Board. EFRAG, the European Financial Reporting Advisory Group has issued its updated Endorsement Status Report which now reflects the European Commission’s endorsement of the amendments to IFRS 16 (Lease Liability in a Sale and Leaseback). The UK Endorsement Board has published its 2022/23 Annual Report. The UK Endorsement Board has also adopted Supplier Finance Arrangements: Amendments to IAS 7 Statement of Cash Flows and IFRS 7 Financial Instruments: Disclosures, issued by the International Accounting Standards Board in May 2023. The International Accounting Standards Board’s (IASB) Research Forum hosted 85 participants at the IESEG Management School in Paris 2–4 November. Key highlights and findings from this event are now available to view online. In a recently uploaded video, IASB Member Ann Tarca explains proposals in the IFRS Accounting Taxonomy—Proposed Update 2 Common Practice for Financial Instruments, General Improvements and Technology Update currently out for consultation. The International Forum of Accounting Standard Setters met on 26th to 27th September to discuss matters of relevance to National Standard Setters across the globe. A report which discusses the key messages has been published. Olivier Boutellis-Taft, CEO of Accountancy Europe has announced that he will step down from his role at the end of 2024. Assurance and Auditing FRC The Financial Reporting Council has published its thematic review of audit sampling. The aim of the review is to identify common practice, concerns and good practice across 7 (Tier 1) firms. The publication shares findings to educate the wider market as audit sampling has been an area of repeated Audit Quality Review (AQR) findings for smaller firms. It will also be useful for Audit Committees in understanding the approach taken by audit teams.  Key observations include: Audit sampling is still prevalent. Most firms base their methodology on similar statistical models but with their own methodologies. This leads to substantial variation. Professional judgement is key. Sufficient training is vital. You can read the full report here. IAASA In the years 2020 to 2022 IAASA’s Audit Quality Unit completed 90 audit file inspections across firms. In November IAASA published a report outlining its key messages and recommendations for auditors relating to the area of audit evidence and procedures performed on the financial statement disclosures. The report highlights the key findings from the inspections, in particular: the number of PIE audit file inspections resulting in findings and recommendations in this area; the number of findings and recommendations relating to this area; and the common auditing standard requirements relating to the respective findings and recommendations raised in this area. IAASA’s YouTube channel includes a video that outlines the key messages and recommendations of the thematic review. Sustainability Climate Finance Week Ireland’s 6th annual Climate Finance Week took place from Monday 20th to Friday 24th November. This year’s theme was ‘Exploring a Sustainable and Just Economic Transition’ and the agenda featured the AIB Sustainability Conference; Biodiversity Finance Day; Innovation in Sustainable Funds and Asset Management and Skills & Expertise Day – Empowering Finance Climate Practitioners. IAASA has issued a letter to the CEOs of Recognised Accounting Bodies (RABs) setting out their expectations for the initial approval of existing statutory auditors to be Sustainability Assurance Service Providers ( SASPs). Accountancy Europe and EFRAG are jointly hosting a webinar on Supporting High Quality ESRS Implementation on Tuesday, 12 December. Accountancy Europe, in collaboration with Ecopreneur.eu and supported by the European Association of Co-Operative Banks has published “5 Reasons why Sustainability Matters for SMEs” which sets out some reasons why SMEs should not wait to start transitioning to more sustainable business models. The International Sustainability Standards Board has issued its November 2023 update and Podcast. The Financial Conduct Authority has confirmed that will introduce a package of measures designed to protect consumers by helping them to make more informed decisions when investing and to enhance the credibility of the sustainable investment market. Other News IAASA has launched a Stakeholder Perceptions Survey to gather insights into how its stakeholders perceive IAASA, it focuses on IAASA achievement of its mission of upholding quality corporate reporting and an accountable profession. The Charity Commission for Northern Ireland is writing to around 7,000 charities in preparation for the roll out of the new traffic light display on the register of charities. The new display, expected to go live later this year, will indicate if a charity has submitted their accounts and reports to the Commission on time or late, and by how many days they are overdue if not submitted at all. The European Council have adopted a regulation creating the European Single Access Point (ESAP) - a platform that will make information easier for investors to consult.  The European Single Access Point will give companies more visibility towards investors and open up more financing opportunities, especially for small companies in small capital markets. The Minister for Enterprise, Trade and Employment recently published the First Update Report on the White Paper on Enterprise Implementation Plan 2023-2024, which was published in May of this year. This report details the work undertaken to progress the 40 initiatives identified in the Implementation Plan and also provides an update on the 15 key target metrics identified in the White Paper. Please click here for the press release and here for the report. The Department of Enterprise, Trade and Employment is holding a free business event in Dublin which will focus on the opportunities and challenges presented by the green economy and digital transformation. The event is on Thursday 7 December. The Director of Financial Regulation, Policy and Risk at the Central Bank of Ireland spoke recently at a conference about the EU’s new Digital Operational Resilience Act or DORA. He delved into some of the detail including the challenges faced when trying to design and implement a framework to address digital operational resilience in the financial sector. He also referred to the work being done by the European Supervisory Authorities (the ESAs) on the implementation of the new framework. Please click here for full details. Private sector organisations with 50 employees or more will shortly be in scope of obligations under protected disclosures legislation to have internal reporting channels and procedures for the making of protected disclosures. Also, this week the Minister for Public Expenditure, NDP Delivery and Reform has issued new statutory guidance on the Protected Disclosures Act 2014. Read more in the Institute’s recent news item. Accountancy Europe discussed the attractiveness of the accounting profession, including how younger generations can be attracted into the profession in their recent article. A reminder again this week of the CRO deadlines for Christmas filing. The CRO writes that processing before the Christmas break of submissions received after the dates below cannot be guaranteed:      FE PHRAINN ONLINE SCHEME 12 DECEMBER 2023 A1 ORDINARY ONLINE SCHEME 7 DECEMBER 2023 CHANGE OF NAME 8 DECEMBER2023 REREGISTRATIONS 8 DECEMBER 2023 COMPANY NAME RESERVATIONS 15 DECEMBER 2023   For further technical information and updates please visit the Technical Hub on the Institute website.

Gender allyship can help to support workplace equity, but only when it is genuine and meaningful. Andrea Dermody offers her advice on how to embed a culture of true support and allyship Harvard Business Review defines gender allyship as the purposeful collaboration of dominant group members (men) with women to actively promote gender equality and equity in their personal lives and the workplace through supportive and collaborative relationships, acts of sponsorship, and public advocacy to drive systemic change. While allyship can be a powerful tool for creating inclusive and equitable environments, however, there are instances in which it might not be as effective as intended. Research has suggested a stark perception gap between what men think they are doing to support women versus what they are actually doing.  The recent Allyship-In-Action study of more than 1,400 men and women found 78 percent of men said they had personally given a woman credit for her contributions and ideas in a meeting in the previous year. Just 49 percent of the women in the study reported witnessing such behaviour during that period. Despite good intentions, the effectiveness of men’s allyship efforts may be limited by several factors, including: Superficial engagement: Some allyship efforts may lack genuine commitment and understanding of the issues at hand.  Tokenism and performative actions: Both can create an illusion of support without leading to meaningful change. Lack of accountability and measurement: Allyship efforts can lack direction and fail to produce tangible outcomes without clear accountability and measurable goals. Resistance to change and inclusivity: Resistance from certain individuals or groups within the organisation can hinder effective allyship efforts.  In short, allyship is more than just ‘talking the talk’. It’s about fundamentally changing attitudes and behaviours. Simply calling yourself an ally to any person of an underrepresented group misses the point of allyship altogether.  Steps to successful allyship The secret to successful, long-lasting allyship lies in the combination of interpersonal action (developing awareness and motivation) and public action to create accountability and transparency. Here are five steps you can take to help allyship succeed in your organisation.  Educate yourself: Don’t ask people from marginalised backgrounds to take on the emotional, psychological and physical burden of educating you. Take responsibility for yourself. This list of resources from the University of Kent is a great place to start. Listen: Actively listen and amplify the voices of the communities for which you are trying to be an ally. Without listening, you have the danger of venturing into ‘saviour’ territory, where you assume you know more about what marginalised groups need than those in that group. Your actions become self-serving, and you benefit more than the groups you are trying to help.  Reflect on your privileges: The word “privilege” can be polarising, but it is essential to recognise the privileges you have to be an ally for others. Use your voice to make the voices of marginalised people heard. Use your privilege and influence to advocate for change and promote inclusivity. Stand up against discriminatory practices, biases and systemic injustices.  Mentor others: As an ally, showing your support through mentoring programmes is a great idea. By getting to know your mentee as an individual, you can learn about their experiences and perspectives. The more you know and understand, the better equipped you will be to help. See something, say something: Speak out in support of marginalised groups and actively challenge discriminatory behaviours and policies within your sphere of influence. If you see someone being discriminated against, support them at that moment, not later. Intervene even if the targeted individual or community is not present. By demonstrating that you don’t find it appropriate, you can help change the culture and create a more inclusive and equitable society.  Remember, though, that allyship is an ongoing journey that requires continuous self-reflection, learning and active engagement – it’s playing the long game for success. Andrea Dermody is a diversity and inclusion consultant, speaker and coach at Dermody

From next year, individual taxpayers will see more in their pockets as a result of the planned reductions in national insurance contributions However, today’s Autumn Statement featured little in the way of immediate tax cuts and supports for small and medium sized businesses As a region, Northern Ireland continues to be left behind on key issues and supports   22 November 2023 – Today’s Autumn Statement was a missed opportunity to provide struggling businesses with tax incentives and supports which would allow them to grow and thrive, according to Chartered Accountants Ireland. The Institute, which represents almost 5,000 members in Northern Ireland, more than two thirds of whom work in business, made these remarks as Chancellor Jeremy Hunt delivered his Autumn Statement in Westminster earlier today. Commenting, Janette Burns, Chair of the Northern Ireland Tax Committee of Chartered Accountants Ireland said:  “Today’s Autumn Statement was clearly delivered with one eye on a general election next year. More cash in people’s pockets after the cuts in national insurance take effect from January and April next year are positive and will also help reduce the cost of employment. But today the Chancellor did not deliver the same level of tax supports that we know many small businesses urgently need and want as they continue to grapple with high inflation. Confirmation that companies will be able to fully expense the cost of capital investment in new plant and machinery against profits permanently, and beyond the original end date of 31 March 2026, is a bold move and will provide the certainty needed for major investment plans, which in turn will bolster the economy and productivity. But this is only of real benefit to larger companies".  What’s needed is targeted incentives and supports for small and medium businesses. For example, Northern Ireland’s hospitality sector could have benefited from a reduction in the 20% VAT rate. Just a few miles down the road in Ireland, the rate is 13.5% and many other European countries have much lower rates than the UK. When coupled with high food prices, this makes it very difficult for Northern Ireland hospitality businesses to compete.   Paul Millar, Chairman of Chartered Accountants Ulster Society added:  “The relief available to SME companies which incentivises R&D activity was reduced by almost 34% from April this year. We urge the Chancellor not to further reduce relief this for genuine innovation activity as part of the plans announced today to merge the two current schemes. This is just another example of where the Chancellor could have taken the opportunity to set out a detailed roadmap for this relief which would have provided certainty to those investing in R&D.  In recent years Northern Ireland businesses have shown how adaptive and resilient they are. This was highlighted at the recent investment conference which showcased the brightest and the best we have to offer. But more needs to be done. The Government needs to recognise and reward this by establishing a pipeline of tax supports and incentives to enable businesses to truly grasp the entrepreneurial mindset which we know would help Northern Ireland crystallise all the opportunities that are there for the taking. Let us not forget that Northern Ireland also has legislation potentially within its grasp to reduce its corporation tax rate to match that in the Republic. Innovation, creativity, and a more entrepreneurial approach will benefit all here by driving economic growth, and job creation.  The time is ripe to help Northern Ireland level up. But this cannot begin until we have our politicians back in Government. Once again, we urge them to look at the bigger picture. We echo the recent sentiment that political decisions should not affect operational decisions. But this equally applies to the business of doing what is needed to help grow our economy, and ultimately benefit all of our citizens.” Other information:- The main tax announcements by the Chancellor today were as follows:- National insurance contributions for the self-employed will reduce by 1% from 6 April 2024; Employee national insurance contributions will reduce by 2% to 10% from 6 January 2024; The 100% deduction available to companies for investments in new plant and machinery is being made permanent and will not end on 31 March 2026; and The UK’s SME and large company R&D tax relief regimes are being merged into one scheme which will commence from 1 April 2024.

Geopolitical uncertainty is reshaping boardroom priorities and acquiring the right expertise is crucial for strategic resilience, writes Dan Byrne Geopolitical risk: Is your board talking about it? If so, do they know how to handle it? The harsh reality is that many companies can’t do so properly. However, stakeholders are rarely patient when it comes to geopolitics. When something happens, they want a response from your corporate leadership.  The last thing your board needs to be is unaware of how to handle a situation, what to say, and how to adapt your strategy to changing global events. The challenge is processing that it’s all happening at once.  The news cycle is now dominated by the Israel-Hamas war. Before this started, the spotlight was on the Russian invasion of Ukraine and, before that, the chaotic US withdrawal from Afghanistan.  Meanwhile, we’ve got tensions between the West and China, the right-wing backlash against Brazilian and US elections, and unresolved Brexit issues – not to mention the protracted conflicts that are now so ingrained in the fabric of modern geopolitics. Every geopolitical crisis begins a new chapter of geopolitical pressure in corporate playbooks. The importance of geopolitical risk Assessing geopolitical risk is essential. It’s not going away and, depending on your company, it could be crucial to your strategy.  This doesn’t have to be direct – your company’s stance on a particular issue, for example. It can also be indirect – such as the businesses you work with within your supply chain. Many American companies have been shifting their manufacturing from China to other locations, such as Vietnam, out of fear that Chinese authorities could disrupt their business at the drop of a hat. Corporate leaders will be prodded by investors wanting to know if their company can survive through sanctions or consumers wanting to see their response to escalating conflict. The storm of questions will come; the challenge is how best to weather it. Expertise needed Experts in geopolitical risk will have the following skills: A deep understanding of corporate strategy and risk; Knowledge of global affairs, new or potential conflicts with global impacts, the intricacies of trade sanctions and the knock-on effects of government changes on international relations; and The ability to navigate through substantial geopolitical fallouts. The hard part is finding this expertise. Finding the right candidate to fill a board seat depends on multiple factors, like the availability of talent, training, networks, and an alignment of values. In some situations, this is a heavy ask.  It’s also worth noting that the market for geopolitical expertise is highly active right now as companies realise that they need to be prepared. Playing the long game Organisations should realise that the quest for geopolitical experience for your board may be a long game.  It can take time to find the talent that works well for your business – and it’s time that stakeholders may not always give you, pushing you for an answer and refusing to accept that you might need more time. That’s why it is essential to start now on geopolitical expertise if you haven’t already. If it feels like you’re playing catch-up, bear in mind that this won’t always be the case. Eventually, you will have the solid knowledge you need on your board to help you develop thorough answers to complex questions.  In reality, the world always moves faster than corporate governance is comfortable with, so it’s better to get ahead. Dan Byrne is a content writer at The Corporate Governance Institute

Welcome to this edition of Technical Roundup. In recent developments, Global Reporting Initiative has announced the upcoming launch of the Sustainability Innovation Lab which is being established to enable companies to meet their evolving sustainability disclosure requirements and the Financial Reporting Council invites stakeholders to attend a webinar on Thursday, 23 November on its consultation to strengthen auditor requirements to detect and report material misstatements from non-compliance with laws and regulations. Read more on these and other developments that may be of interest to members below. Financial Reporting EFRAG, the European Financial Reporting Advisory Group has published its draft comment letter in response to the International Accounting Standard Board’s  Exposure Draft- Annual Improvements Volume 11. The Exposure Draft proposes minor improvements and clarifications in relation to IFRS accounting standards. In its draft response, EFRAG agreed with the majority of the proposed changes, and disagreed with proposed amendments to IFRS 9 on derecognition of lease liabilities. EFRAG has released its October 2023 update which summarises public technical discussions and decisions taken in the month. EFRAG has updated its Endorsement Status Report, which now reflects the EC’s endorsement of IAS 12 International Tax Reforms – Pillar Two Model Rules. The Financial Reporting Council (FRC) has published its latest thematic review “IFRS 17 ‘Insurance Contracts’ Interim Disclosures in the First Year of Application”. IFRS 17 became effective on 1 January 2023 and represents a fundamental change in accounting for insurance contracts, introducing a comprehensive principles-based approach to replace the previous approach under IFRS 4. The report aims to provide examples of better practice for companies when considering the completeness of their upcoming and year-end disclosures. Whilst identifying some areas for improvement, the FRC noted that overall they were pleased with the quality of IFRS 17 disclosures. The IFRS Foundation has published Compilation of Agenda Decisions- Volume 9. This compilation includes three agenda decisions from the IFRS Interpretations Committee (IFRIC) covering; Premiums Receivable from an Intermediary (IFRS 17 Insurance Contracts and IFRS 9 Financial Instruments); Homes and Home Loans Provided to Employees (IAS 19); and Guarantee over a Derivative Contract (IFRS 9). The Financial Reporting Council (FRC) has published a consultation paper on proposed changes to the Actuarial Standard Technical Memorandum 1 (AS TM1) (and its Annex: Exposure Draft of version 5.0 of TM1) to reflect the changes in the market conditions and outlook. Following on from King Charles Speech to Parliament on 7 November the FRC has highlighted that the UK Government’s plan for primary legislation to modernise the regulation of audit, corporate reporting and governance has not been prioritised for the next Parliamentary session. Assurance and Auditing On August 2, the International Auditing and Assurance Standards Board (IAASB) launched a public consultation on its landmark proposed global sustainability assurance standard, International Standard on Sustainability Assurance (ISSA) 5000, General Requirements for Sustainability Assurance Engagements.  The results of this campaign have now been published. IAASA has published five factsheets providing an overview of its role and approach to the quality assurance review of the audits of public interest entities in Ireland.  The factsheets summarise the review process of the relevant firms and give a set of links to access other relevant information such as previous thematic reviews and IAAS’s annual reports. The FRC is holding a webinar on Thursday, 23 November on its consultation to strengthen auditor requirements to detect and report material misstatements from non-compliance with laws and regulations. Sustainability EFRAG and CDP have announced that they will cooperate to maximise alignment of CDP’s global environmental disclosure platform with the EU’s environmental reporting standards. This alignment is intended to drive market uptake of the European Sustainability Reporting Standards. In doing this, CDP, supported by EFRAG, will offer webinars and detailed technical guidance materials to support companies reporting on ESRS data points through CDP. Global Reporting Initiative (GRI) has announced the launch of a Sustainability Innovation Lab. This is being established to enable companies to meet their evolving sustainability disclosure requirements and to encourage innovative thinking. ESG Governance – Questions Boards should ask to lead the Sustainability Transition: This document, issued by Accountancy Europe, ecoDa and ECIIA, aims to help boards with embedding sustainability – and specifically environmental, social and governance (ESG) factors, into company strategy and business models, and to ensure that proper governance supports this. Anti-money laundering and Sanctions The latest edition of the UK National Crime Agency SARs Reporters Booklet for November 2023 whereby it shares perspectives on the SARs regime, is now available on their website. The European Commission has this month published a full list of PEPs for EU countries. The list for Ireland bear close resemblance to the list in the guidelines that were issued by the Irish Dept. Of Justice in January of this year. The European Parliament has recently issued a report on EU sanctions implementation and monitoring. It includes recommendations to reinforce the EU’s capacities to implement and monitor sanctions. The think tank writes that the EU should agree on a joint definition of what constitutes a competent national authority, ensure adequate guidance for the EU’s economic operators, enhance the involvement of implementation and enforcement expertise in the planning phase of sanctions regimes, and design a new horizontal sanctions regime to counter circumvention. You can access the think tank summary and the report here. Insolvency The first in a series to introduce members of the Consultative Committee of Accountancy Bodies – Ireland (CCAB-I) Insolvency Committee was recently published. The first edition, available here, features Cormac Mohan. Cormac is the managing partner at Fitzwilliam Corporate Insolvency, a Dublin based corporate restructuring practice. He is an experienced Insolvency Practitioner; Past President of CPA Ireland and is a member of the CCAB-I Insolvency Committee since 2016. Other News The European Securities & Markets Authority (ESMA) is inviting comments re Consultation on the review of Tier 1 CCP Fees regarding all matters in this paper and in particular on the specific questions summarised in Annex 1. ESMA will consider all comments received by 10 November 2023. ESMA has also published the latest edition of its Spotlight on Markets Newsletter for October 2023. The FRC has published the 2023 suite of FRC Taxonomies.  The 2024 suite incorporates changes to all of the FRC’s Taxonomies - UK IFRS, FRS 101, FRS 102, UKSEF, and Charities – available in English or Welsh. The FRC has published its Review of Corporate Governance Reporting. This report showcases examples of high-quality and insightful corporate governance reporting by companies. In its report, the FRC noted that they were encouraged by the fact that companies were more transparent in reporting departures from the Corporate Governance Code, but were also disappointed by the many examples boilerplate reporting which fails to meet stakeholder expectations. The Charities Regulator's latest newsletter has issued which includes important dates for your diary and the impact of volunteers are themes throughout this month’s edition.   The Financial Conduct Authority have issued Discussion Paper 23/4: Regulating cryptoassets Phase 1: Stablecoins.  The DP will help develop their regime for flat-backed stablecoins including when used as a means of payment. The European Commission have published a Draft Act on Supervision of crypto-assets – criteria, procedures and fees.  This draft act is open for feedback until 6 December. The Irish Competition and Consumer Protection Commission (CCPC) has recently published its Strategy Statement 2024-2026. The press release states that the statement sets out four strategic goals which span the CCPC’s broad remit and work. It will work to use its tools, including new powers, to increase enforcement and compliance outcomes, empower consumers to make informed choices, be the leading voice in promoting open and competitive markets and representing the interests of consumers and evolve and grow in size and capability. You can read the strategy statement here. The Governor of the Central Bank recently addressed the Irish League of Credit Unions conference. He spoke on a range of matters including the significant opportunity provided by the Credit Union Amendment Bill and of the significant opportunities which exist in relation to credit union lending. You can read further details here .Also this week the Central Bank has published Individual Accountability Framework Standards and Guidance .The press release on its website states that  Following a three month consultation process, the Central Bank has published a Feedback Statement and issued draft Regulations and Guidance to firms on the Individual Accountability Framework. The Corporate Enforcement Authority (CEA) has opened a subscription to its newsletter mailing list. It aims to send a CEA newsletter every quarter to provide subscribers with updates on CEA news and company law matters. You can sign up to the newsletter by going to the CEA home page. A reminder to readers that the CRO has published its Christmas filing deadlines and clarifies that processing before the Christmas break of submissions received after the dates below cannot be guaranteed:      FE PHRAINN ONLINE SCHEME 12 DECEMBER 2023 A1 ORDINARY ONLINE SCHEME 7 DECEMBER 2023 CHANGE OF NAME 8 DECEMBER2023 REREGISTRATIONS 8 DECEMBER 2023 COMPANY NAME RESERVATIONS 15 DECEMBER 2023   For further technical information and updates please visit the Technical Hub on the Institute website.

This week, 6-10 November 2023, is Charity Trustees’ Week, an opportunity to acknowledge the contribution of volunteer trustees and celebrate their valuable work in the governance and leadership of charities.   We wish to acknowledge the enormous contribution of Institute members, many of whom contribute to the charity sector as managers, employees, trustees, auditors, professional advisors, volunteers, regulators and, of course, as donors.  On 16 November, Chartered Accountants House hosted the awards ceremony for the annual Good Governance Awards for non-profit organisations. We are delighted to again partner with Carmichael for this important initiative that recognises and encourages good governance practice by charities and other non-profits in Ireland. All entrants receive feedback from a small army of volunteers, including 76 experienced and expert assessors and judges, and eight accountancy firms. Over 200 people registered to attend the awards ceremony.  Opening the event, Deputy President of Chartered Accountants Ireland, Barry Doyle said “The charity and non-profit sector is of huge benefit to our whole society. It provides services to the vulnerable, fills a social need, and progresses sports, arts and recreation initiatives across the country. Many within it couldn’t function without donations from the public. By championing accountability, good governance, and transparency, the sector can ensure that public funding as well as charitable donations remain forthcoming.” Commenting on the awards, Níall Fitzgerald, Head of Ethics and Governance, Chartered Accountants Ireland, and an awards judge, observed: “The quality of governance and reporting remains high, and there is evidence that entrants are implementing feedback received from the awards in earlier years. There are often narrow margins between winners and runner ups. In these situations, the winner often gains an edge through a combination of clear and concise storytelling that demonstrates the impact of the organisation and the challenges it faces, transparent disclosure of the organisation’s approach to risk management and how this is aligned with its vision, mission and values.” Consistent with last year, the higher-scoring entrants are reporting beyond minimum requirements on issues like diversity, equity and inclusion, and also acknowledging the social and environmental impact of their work on beneficiaries, and society as a whole, for example aligning activities with the UN Sustainable Development Goals, or providing some insight on the organisation’s carbon footprint.” Well done to the organisations that demonstrated their commitment to good governance by entering this year’s awards, and congratulations to this year’s winners: Category  Winner  Organisations with annual turnover < €100,000  NiteLine  Organisations with annual turnover €100,000 – €250,000  Kilkenny Volunteer Centre  Organisations with annual turnover €250,000 – €750,000  Spraoi agus Spórt  Organisations with annual turnover €750,000 – €2.5 million  Leave No Trace Ireland  Organisations with annual turnover €2.5 million – €10 million  Barretstown  Organisations with annual turnover €10 million – €50 million  Jigsaw, the National Centre for Youth Mental Health  Organisations with annual turnover > €50 million  Trócaire See more governance news on the Governance Resource Centre

The pervasive use of business jargon can hinder effective communication and alienate colleagues and clients. Jean Evans explores the impact and pitfalls of using it in business According to Duolingo, many words and phrases used in ‘business English’ have been subsumed into other languages, and 60 percent of people say they had to figure out the jargon used on their own when entering an organisation or business sector. The prolific use of business jargon can not only lead to potential miscommunication, it can also exclude others in the organisation from networking within their business sphere. Why do we use jargon? The use of jargon can achieve several things. It can: project authority; convey sophistication; showcase trendiness; and show business savvy. However, jargon can make others in your organisation or at a networking event feel uninformed and stressed, leading to less productivity, miscommunication and heightening another person’s sense of imposter syndrome. Acronyms Acronyms can be equally confusing and isolating for people who don’t understand them. In business, we hear a tremendous number of acronyms. Never assume your audience understands them. If acronyms crop up, make sure they are explained in full at the outset. For example, “key performance indicator (KPI)” can be formatted to inform an uninitiated reader of the acronym’s meaning before they continue reading the document. Jargon in marketing and promotion The amount of jargon used in brochures, websites, social media pitches and proposals can be staggering, particularly in hard-to-understand areas such as finance. If you want to sell your services to those outside the accountancy profession, eliminate all the technical terms you would typically use daily from client-facing content and have someone outside your industry review copy to see if it stands up on its own. If they understand what you are trying to sell, so will potential clients. Raise your awareness Become aware of the language you use. It can create a barrier, but when used correctly, it has the power to include everyone in the conversation. Jean Evans is a Networking Architect at NetworkMe

Budget 2024 was substantial. Brian Brennan and Norah Collender outline the measures that will be implemented in the new Finance Bill Finance (No.2) Bill 2023 was introduced by Minister McGrath following a budget package worth €14 billion announced on Budget Day. The Bill is large by normal standards, running to over 270 pages, due to substantial legislation required to introduce the new minimum effective rate of tax for companies/groups with revenues exceeding €750 million. The Bill sets out the legislation for measures announced on Budget Day along with the customary raft of changes of keen interest to us, the accountancy profession, as advisors and business leaders.   Corporation tax  The Bill proposes numerous measures impacting businesses, including changes to corporation tax loss relief rules and amendments to the taxation of leases.   The Bill also includes a revised form of the bank levy for 2024 based on a measure of deposits held by each liable institution. In addition, the Bill sets in motion the Budget’s enhancement of the R&D Tax Credit (RDTC) rate to 30 percent and doubles a company’s first-year refundable RDTC instalment. These enhancements apply to accounting periods commencing on or after 1 January 2024. The Bill also introduces a ‘pre-notification’ requirement for new RDTC claimants or companies that have not made an RDTC claim in the three previous accounting periods.   New measures are also provided for in the Bill on outbound payments of interest, royalties and distributions (including dividends) to jurisdictions on the EU list of non-cooperative jurisdictions, no-tax and zero-tax jurisdictions. These measures are designed to meet commitments contained in Ireland’s National Recovery and Resilience Plan. Income tax The Bill sets out the required provisions to enable Budget increases to income tax rate bands, tax credits and reductions to USC. It also provides that gains on the exercise, assignment or release of a right to acquire shares or other assets will be assessed under the PAYE regime for gains realised on or after 1 January 2024. As with other emoluments and benefits chargeable under PAYE, employers will be responsible for processing the calculation and collection of tax as part of their employer PAYE returns.  Capital gains tax (CGT) and Capital acquisitions tax (CAT) The Bill proposes changes to CGT Retirement Relief for business owners and farmers, which extends the age limit for the relief from 66 to 70 but limits disposals to a child made by a disponer aged 55 to 69 to €10 million. This measure will be an impediment to a well-organised lifetime intergenerational transfer of larger businesses.    The Bill introduces a new CAT reporting requirement on interest-free loans involving private companies, even where no gift tax is payable. Clawback provisions impacting CAT Business Relief and Agricultural relief are also amended in the Bill.   Pension measures Several measures relating to pensions are proposed in the Bill, including the removal of the upper age limit on taking benefits from Personal Retirement Savings Accounts (PRSAs), allowing for drawdowns by PRSA holders after they reach the age of 75 years. The Bill proposes that Revenue will not approve any applications for new retirement annuity contracts received after 1 January 2024. Anti-avoidance measures in the Bill aim to prevent assets from being used to provide loans and/or as security to private companies. Pension funds will also have to ensure that tenancies are registered with the Residential Tenancies Board (RTB) to avail of gross roll-up on rental income.   Property The Bill legislates for the Budget’s relief at the standard rate of income tax for residential rental income earned by landlords with properties in the rental market from 2023 to 2027. In addition, the Bill clarifies the taxation of rents paid to non-Irish resident landlords by amending legislation introduced in the Finance Act 2022. In summary, where a tenant of a non-resident landlord pays rent to a collection agent, the tenant will not be required to deduct and remit withholding tax to Revenue. Instead, the collection agent may either deduct and remit tax to Revenue or otherwise remain assessable and chargeable for tax in respect of the rental income of the non-resident landlord.  The Bill also extends the Help to Buy scheme until the end of 2025.   VAT The Bill confirms a number of measures announced in the Budget, such as the extension of the nine percent rate of VAT for the supply of gas and electricity, the application of the zero-rate of VAT to certain audiobooks or eBooks, and the increase in the VAT registration thresholds. The Bill is currently making its way through the Dáil and is expected to be signed into law just before Christmas.  Brian Brennan is Tax Parter at KPMG Norah Collender is Tax Director at KPMG