Welcome to this edition of Technical Roundup. In recent developments, a new traffic light display, which will indicate if a charity has submitted their accounts and reports to the Charity Commission for Northern Ireland on time, is being rolled out on the Register of Charities; the European Securities & Markets Authority has published an article on the evolution of the European share market structure from 2019 to 2022, following the implementation of the markets in financial instruments directive (MiFID II). Read more on these and other developments that may be of interest to members below. Financial Reporting The Institute has issued its response to the International Accounting Standards Board’s (IASB) request for information on the Post-Implementation Review of IFRS 15 Revenue from Contracts with Customers. Whilst supporting the strong framework provided by the five-step framework in IFRS 15, the Institute made some recommendations and comments in its submission, including a request for further guidance in certain areas where the application of the standard is more challenging. The Institute has also issued its response to the draft amendments to the LLP SORP. Some of the updates being proposed to the SORP include. Updates for Climate-related financial disclosures Guidance relating to amounts payable to former members Guidance on sharing of group profits Guidance on automatic division of profits to members who do not provide any substantive services to the LLP An effective date of periods commencing on or after 1 January 2024 is proposed for the changes EFRAG and the UK Endorsement Board have also issued their responses to the IASB’s request for views on the Post-Implementation Review of IFRS 15. The Financial Reporting Council (FRC) has published a report looking at how companies can improve their corporate reporting by taking a more focused, strategic approach to assessing materiality. The European Financial Reporting Advisory Group (EFRAG) are holding a online roundtables for different interest groups at various dates in November and December entitled “Statement of Cash Flows – Is there a need for change?” In a thought provoking article, Oliver Boutellis-Taft, CEO of Accountancy Europe, discusses the methods used to categorise entities for regulatory purposes across Europe. This is largely performed using quantitative metrics such as turnover. In the article, the potential benefits of the use of more metrics which are based on impacts and risks are discussed. Accountancy Europe has issued its October 2023 Newsletter. The IFRS Foundation has issued its National Standard-setters newsletter. This discusses the recent World Standard Setters Conference which was held in London on 25th and 26th September. The IASB has issued its October 2023 update. this summarises the recent activities and decisions made during their recent meetings. The IASB has also released its October 2023 podcast. The IFRS Foundation has also released its October 2023 monthly news summary. IFRIC, the IFRS Interpretations Committee has issued its September 2023 update. This summarises the decisions reached by the Committee in its recent meetings. Assurance and Auditing The Financial Reporting Council (FRC) has launched a consultation to strengthen auditor requirements to detect and report material misstatements from non-compliance with laws, ISA(UK)250A and ISA (UK)250 B, and regulations and to clarify when auditors should report such breaches, and other significant matters, to the relevant regulators. The aim is to enhance the useability and informativeness of the audit. They are consulting on strengthening both ISAs and the consultation closes on 12 January 2024. The FRC are planning a webinar and roundtables in  November for interested parties. Chartered Accountants Ireland has responded to the FRC’s consultation on proposed amendments to the Ethical Standard for Auditors. We welcome the moves to align with the IESBA standard and we are supportive of changes which add clarity and therefore make compliance easier, but we have concerns that the proposed effective date of 15 December 2024 might not allow firms sufficient time to make the necessary changes to their global systems. Sustainability Proposed ISSA 5000: the application of materiality by the entity and the assurance practitioner. As part of the IAASB's intensive outreach campaign across the globe, there were requests from a range of stakeholders to provide additional information on materiality matters to better help them navigate the recently proposed International Standard on Sustainability Assurance (ISSA) 5000, General Requirements for Sustainability Assurance Engagements. This comprehensive set of Frequently Asked Questions was developed to respond to these requests. The compilation addresses a variety of questions, including how the concept of materiality applies to sustainability reporting and assurance; the definition of double materiality; and how an assurance practitioner considers an organization’s “materiality process” during a sustainability assurance engagement, among other questions and answers. Following the passing of the scrutiny period for the European Sustainability Reporting Standards (ESRS), the 12 standards have now been adopted and integrated in the European legal framework. The European Financial Reporting Advisory Group (EFRAG) have welcomed this significant milestone and noted its dedication to providing support for the successful implementation of the suite of standards. This includes: Their launch of a Q&A platform to encourage stakeholder dialogue The development of further standards for SMEs The ESRS did not go unchallenged through the period of scrutiny and on 18th October, a resolution calling for a new delegated act to be submitted (containing significant reductions on the level of requirements placed on companies by the CSRD and ESRS) was defeated in the European Parliament by a margin of 359 against to 261 in favour. Whilst the challenge was defeated, it is notable that the margin in favour of a revision to the CSRD was significant. Accountancy Europe together with ECIAA and ecoDa has released a publication entitled “ESG Governance: questions boards should ask to lead the sustainability transition”. This publication aims to help boards in embedding sustainability factors into company strategy and business models and to ensure proper governance of this. The Brazilian Ministry of Finance and the Comissão de Valores Mobiliários (CVM) have announced that the International Sustainability Standards Board’s (ISSB) IFRS Sustainability Disclosure Standards will be incorporated into the Brazilian regulatory framework, setting out a roadmap to move from voluntary use starting in 2024 to mandatory use on 1 January 2026. The FRC and the British Accounting and Finance Association's (BAFA) hosted a joint event: Embedding Sustainability in Audit and Accounting Education—A forum for Professional Accountancy Bodies, Academics, and Training Providers on 1 November at Manchester University. The International Sustainability Standards Board has issued its ISSB Update, and the latest episode of the ISSB podcast. Insolvency For readers who did not secure a place on the Corporate Enforcement Authority’s (CEA) inaugural conference of 19 October 2023 ,the CEA has now made available the content of most of the papers delivered at the conference and readers can access the papers on the CEA’s website under the “Events “ button. A notable judgement has been handed down in a recent examinership case. In the case involving Mac Interiors Limited, Mr Justice Michael Quinn ruled that the court had no jurisdiction to confirm the scheme of arrangement proposed by the Examiner. Read the article on our website here. Economic crime/Anti-money laundering Readers should note that the Economic Crime and Corporate Transparency Act received royal assent on 26 October 2023. Please click here to access the legislation and here for a press release from UK government on the legislation. It includes new enhanced powers for UK Companies House and a new much debated failure to prevent crime offence for large organisations. More detailed analysis of the legislation and its applicability to our readers will follow in future news items. The Institute’s Professional Standards Dept. (PSD) has recently issued its AML supervision report 22/23. The report outlines PSD’s risk methodology identifying various risk factors to which accountancy firms may be exposed, including but not limited to higher risk services; higher risk clients; exposure to high-risk jurisdictions; complex firm structures and poor regulatory history. It also deals with risk profile of TCSPs (ROI - med/high risk of money laundering, med/low risk of terrorist financing and UK high risk of money laundering). Emerging risks include increase in insolvencies, risks associated with bounce back loans, the ongoing crisis in Ukraine and cryptoassets. Finally, the most common findings related to breach were no or inadequate documented policies & procedures, inadequate documentation of CDD, no or inadequate CDD procedures, no ongoing CDD monitoring, no or inadequate client risk assessment/record missing, no/inadequate periodic review of compliance with AML regs, no or inadequate training, no or inadequate firm-wide risk assessment. In the latest SARs in Action magazine, a wide range of money muling issues are discussed. The National Crime Agency 's National Economic Crime Centre looks at how money muling networks may form, there is a look at how money muling is addressed within the banking sector by NatWest Group, and a discussion on educating young people on the threat of money muling by UK Finance.  The latest Financial Action Task Force (FATF) 'High-Risk Jurisdictions subject to a Call for Action' (black list ) and 'Jurisdictions under Increased Monitoring' (grey list ) documents issued by the FATF on the 27 of October 2023 are now available on FATF’s website and you can access the information here. Other News The European Banking Authority (EBA) and the European Securities and Markets Authority (ESMA) have published a Consultation Paper on two draft Joint Guidelines covering suitability assessment of members of the management body, and suitability of shareholders and members with qualifying holdings of issuers of asset referenced tokens (ARTs) and of crypto-asset service provider (CASPs).  A new traffic light display, which will indicate if a charity has submitted their accounts and reports to the Charity Commission for Northern Ireland on time, is being rolled out on the register of charities. The Central Bank of Ireland are hosting a Financial System Conference 2023 – Achieving good outcomes in an uncertain world – which will take place on 8 November 2023 at the Aviva Stadium in Dublin.  This event will bring together diverse perspectives from industry leaders, consumer representatives and policymakers, from Ireland and across the EU, to discuss and debate key issues for the financial system.  UKFIU's magazine SARs in Action: Special edition on Money Mules The Financial Reporting Council (FRC) welcomes the appointment of Alan Vallance as the Institute of Chartered Accountants in England and Wales’ (ICAEW) Chief Executive Officer, replacing Michael Izza who is due to retire in spring 2024. ESMA has published an article on the evolution of the European share market structure from 2019 to 2022, following the implementation of the markets in financial instruments directive (MiFID II). Specific focus is given to the impact of the UK’s withdrawal from the EU, given its pivotal role in equity markets. In an interesting article issued by IFAC, Pascal Bornet discusses the opportunities that artificial intelligence and intelligent automation provide to accountants. The Screening of Third Country Transactions Bill 2022 was signed into law by the President on 31st October 2023. The finalised text of the legislation is not yet on the Irish statute book website and it is anticipated that it will not become operational until Q2 2024. The legislation when operational will require that certain investments in critical Irish industries that may present risks to Ireland’s security or public order must be reviewed by the Minister for Enterprise Trade and Employment. The legislation will apply to transactions (or an accumulation of transactions in a twelve month period) equal to or greater than €2,000,000. Third country is  any non-EU/EEA country other than Switzerland. Therefore the UK and the US fall within the definition of third country. The types of transaction to which the legislation will apply are set out in Article 4(1) (a)-(e) of the 2019 EU regulation establishing a framework for the screening of foreign direct investments into the Union such as critical infrastructure including energy transport, water and critical technologies including aerospace, defence, energy storage. The trigger for a transaction to fall within the scope of the legislation is a change in shares or voting rights from 25% or less to more than 25% or from 50% or less to more than 50%. The Minister can review transactions post completion in certain circumstances and can call in certain transactions even if non notifiable where there are reasonable grounds for believing that the transaction would be manifestly contrary to Irish security or public order. Following recent changes in UK legislation, cryptoassets promotions targeting UK customers now fall under the remit of the Financial Conduct Authority (FCA). In light of this, the FCA has introduced rules designed to give people a better understanding of what they are investing in. They have also issued guidance to support crypto firms in complying with the new marketing rules. The European Commission has adopted the proposal to increase the company size thresholds set out in the Accounting Directive. This follows a consultation period in recent months which proposed a 25% increase in the size limits for turnover and balance sheet total to reflect the levels of inflation since the limits were introduced. The Institute, under the auspices of CCAB-I issued a response to this in October and agreed with the proposed increase. The amendments will not come into force until they are published in the Official Journal. Once in force, the changes would allow member states, including Ireland, to increase their company size thresholds for turnover and balance sheet total locally. The FRC has released two reports on the actuarial profession in the UK. One report highlights gender imbalance in the profession, its second report looks at the use of AI and machine learning in UK actuarial work. 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.  

97% of parents surveyed by Chartered Accountants Ireland report that their career or working pattern has been impacted by childcare responsibilities. The findings show that 16% reduced their working hours, one quarter (27%) requested to work flexible hours, and one in five (19%) are currently considering adjusting their working hours. The survey, which gathered responses from chartered accountants in the Republic of Ireland has shed light on the significant challenges facing parents seeking childcare in Ireland. It highlights the crucial issues of cost barriers and their impact on career progression, while calling for increased childcare support. Chartered Accountants Ireland represents over 32,000 professional accountants, two thirds of whom work in business. When asked what they saw as the main barriers to securing appropriate childcare in Ireland, members highlighted both cost and capacity as being the biggest issues facing working parents. The financial burden is clear, with one third of members paying up to €1,000 a month per child on childcare, and one third paying between €1,000 and €2,000 per month. Commenting Cróna Clohisey, Tax & Public Policy Lead, Chartered Accountants Ireland said “The significant cost burden is one element of the problem, but even accessing places in childcare facilities in the first instance is a big barrier. As most of us know, this process begins long before a child is even born. Members are clear that both cost and the lack of available spaces need to be addressed by Government in order to better support working parents.”  This month’s Budget announcement provided for an increase in the national childcare subsidy (NCS) from €1.40 to €2.14 as well as extending the NCS to certain childminders, but the Institute argues that while this will help with the cost of childcare, it will not address capacity constraints within the market. Clohisey continued “A longer-term strategy for tackling ongoing capacity issues in the sector is critical – quite simply more places need to be made available but that can only happen with appropriate funding so that staff are adequately paid and therefore attracted and retained. We have an economy at full employment, and our members are overwhelmingly reporting childcare as a barrier to their full participation in the market. “While a government commitment was made to address supply issues through core funding, this funding must go beyond just keeping the sector from collapse. We are asking government to recognise that childcare provision is part of the critical infrastructure necessary for a functioning economy. The crisis needs to be addressed with a long-term strategy with children at the forefront, that adequately funds the sector, increases capacity, and supports working parents.”  

President Sinead Donovan was in the US this week, meeting with a variety of members and stakeholders. The insights gleaned on the trip will be put into action in the coming weeks and months, but among the key takeaways is that the US remains a destination of choice for Irish ACAs so our task is to drive greater awareness of the opportunities for members; our response to issues like the attractiveness of the profession, adapting to new sustainability reporting standards and cybersecurity will be shaped through collaboration with our US partners; and finally, our profession will continue to play a key role on both sides of the Atlantic driving and servicing inward FDI  in support of Ireland’s economy. Member engagement There is no doubt that the US remains a destination of choice for Irish ACAs and the President heard directly from these members during several office visits and two member events. The ACA proves to be a door opener for so many of our members when they arrive in the States, as indeed does the Mutual Recognition Agreement for members practicing, so our task now is to drive greater awareness of the opportunities and help new and existing members to access these.  Partner engagement As ever, the challenges for the profession are the same whether in Naas or New York. The attractiveness of the profession and sustainability reporting standards were two topics that, as expected, the President devoted a lot of time to in meetings with among others IAASB, AICPA, Chartered Accountants Worldwide Network USA, Deloitte EY, PwC, KPMG, and Harvard University.  How we as a profession adapt to the new reporting standards and educate our members on them will be shaped through such collaboration, and Chartered Accountants Ireland will be at the heart of that. The same goes for selling the attractiveness of the profession, with a focus on demonstrating the different routes into the profession and demonstrating through our actions our commitment to a healthy work-life balance. Perception is still an issue. In meetings with Boston College, the scale of the profession’s role when it comes to cybersecurity was reinforced. There are approximately 4million open roles in cyber security globally, and accountants are ideally placed to play a central role in tackling the challenge. The Institute held its inaugural seminar for members with Boston College in Dublin last April, and there is so much scope to expand this education to position members to have an impact.  Working for Ireland Inc It was great to meet the IDA and some of the companies (powered by ACAs) supporting inward FDI. Against the backdrop of a new global minimum corporation tax rate from 2024, and stiff competition for investment, our profession will continue to play a key role on both sides of the Atlantic driving and servicing that investment so well for Ireland’s economy. For our part, we will continue to ensure the Institute has a strong voice in demonstrating how the profession can continue to support FDI and be a strong resource for companies.

Successful digital transformation requires strong leadership. Dave Vincent outlines his tips for successfully embedding innovation in business Growing up in Belfast in the seventies and eighties, I was convinced that by 2020, we’d all be travelling around on flying cars or hoverboards and have a host of robot servants looking after us. Fast forward to the nineties, and I can vividly remember sitting in my university computer lab wrestling with the logic and code required to help teach a hungry virtual monkey how to get their hands on a hidden bunch of bananas. In 2023, while software applications and systems are significantly more developed than in the nineties, the reality doesn’t quite match the vision of the eighties (the hoverboard being the biggest disappointment). I couldn’t have dreamed of many of the developments that have instead taken place, however. Since the term ‘artificial intelligence’ (AI) was first coined almost 70 years ago, we’ve seen wave after wave of technology-enabled innovation, from the rise of personal computing to the internet, mobile devices, augmented and virtual reality, the cloud, the metaverse, self-driving vehicles and now, generative AI. Each shift has captured the imagination, created new opportunities and raised further questions and challenges for business leaders. We are surrounded by technology, and every day, we can see that technology evolves and changes as it impacts how we live and do business. How can technology help? Some of the most frequent questions I hear from clients considering digital transformation are: “Where do I start?” “How do I create the most impact?” “What does success look like?” Rather than starting by asking or thinking about what a particular tool or technology can do, I prefer to reverse engineer the questions and ask: “What are you trying to do in your business or what problem would you like to solve, and how can a digital mindset or technology help?” As these new technologies continue to influence all areas of our business operations, customers and employees, companies need a new type of (digital) leader who can understand, interpret and navigate this digital transformation era. The digital leader Implementing new technology is challenging. The organisation seeking to embed the latest technology — and its staff — must unlearn old concepts and embrace the new systems. For digital leaders, this means adopting alternative leadership styles. In the past, leadership was about giving orders and making decisions. Digital leaders know that successful digital transformation is not just about adopting technology; it’s about transforming business and operating models, driving growth, enhancing competitive advantage and increasing business agility. Today’s leaders must be able to evaluate progress, priorities and business models continually and be prepared to change direction quickly. Digital leaders need to understand not only how systems and technology work but also how that technology will be received and used by staff, as well as how it will impact how employees work and the type of work they do. Digital leaders need to be able to effectively manage employees through shifts and changes to ensure that digital technology is used to deliver the best business outcomes. To make informed and pragmatic decisions about technology, digital leaders must be able to evaluate the impact technology can deliver for their organisations, use data to inform policy and decision-making, and proactively assess and manage risks related to data security. To drive digital innovation, leaders must be agile and flexible, creating a culture where innovation, collaboration and continuous learning can flourish and empower their teams to make data-driven decisions. To ensure focus and alignment, leaders must share a well-defined and compelling strategic vision, calling out what success looks like and showing the roadmap that will get there. It is also important to remember that leadership in the digital age is not just the responsibility of the nominated digital leaders and senior leadership teams, however. Every employee can be a digital leader. The future is digitally enabled Organisations can drive digital innovation and growth from the ground up by empowering staff at all levels to take ownership of, and show leadership in, their work.  The future of work is undoubtedly digitally enabled, and business leaders who are prepared to embrace this change and lead their teams effectively will be the ones to succeed. The digital age allows leaders to create more meaningful and purpose-driven work for their employees and promote innovation and growth for their organisations. Organisations can position themselves for continued success by investing in digital leadership development.  And maybe somebody will finally work out how to create the hoverboard of my dreams. Dave Vincent is a Director of Digital Transformation at Grant Thornton Northern Ireland

New research from Edelman Group finds trust in Chartered Accountants rising faster than any other profession amid ongoing economic uncertainty  18 October 2023: The cost-of-living crisis has served to highlight the vital role Chartered Accountants play in helping businesses adapt to new challenges, according to a new study by Edelman Research Group.   78% of respondents said Chartered Accountants have been essential to navigating recent challenges, while 66% of respondents claim they have relied on accountants more than ever before since the cost-of-living crisis began.  Chartered Accountants saw a 7% increase in trust since 2021, rising faster than all other professions included as part of the study, including doctors, nurses, engineers, teachers and lawyers. Nurses, accountants and auditors were the only other professions to see a rise in trust since 2021, with trust in nurses and accountants increasing by 3%. Trust in other financial professions, including bankers and insurance brokers, has declined.  The research findings showed the continuation of a trend over several years of Chartered Accountants playing a central role in supporting the strategic direction of businesses, particularly in times of crisis, with cost-of-living pressures only the latest example of this.  Commenting, Barry Dempsey, Chief Executive of Chartered Accountants Ireland, said:  “This research shows that in times of economic uncertainty, Chartered Accountants continue to step up and help businesses navigate crises. Guidance from Chartered Accountants around the Brexit transition and the COVID-19 pandemic were viewed as essential by respondents, at a rate of 75% and 72% respectively.   “It is promising to see the dedication and integrity of Chartered Accountants reflected in this data, which confirms support across the business sector for the valuable work that our members do. Through economic uncertainties, Chartered Accountants have played a more pivotal role than ever.”  In 2022, Chartered Accountants Ireland successfully advocated for an extension of the Debt Warehousing Scheme for taxpayers for an additional 12 months, allowing greater flexibility for businesses navigating the uncertain circumstances following the pandemic.   Regarding the developing state of Artificial Intelligence, the study says that 8 in 10 respondents feel that the value provided by Chartered Accountants cannot be replicated by AI. As other professions face uncertainty in the face of rapidly developing technology, the role of the Chartered Accountant remains necessary amidst constantly shifting economic conditions.  8 in 10 also say they intend for Chartered Accountants to lead digital transformation within their organisation. This is something Chartered Accountants are already engaged in at major firms.   Barry Dempsey said: “It is also encouraging to see the continued security of accountancy as a profession in the ever-changing landscape of Artificial Intelligence. It is clear from this research that the thoughtful, strategic work of the Chartered Accountant cannot be replicated by a technology. Consensus among the business community on this is warmly welcomed.   “The field of chartered accounting continues to develop into an exciting, creative field open to the next generation, for which technological development is an opportunity, not a threat.”  Notes for Editors:  Edelman Data & Intelligence is a global, multidisciplinary research, analytics and data consultancy company comprised of over 350 research specialists, business scientists, data engineers, behavioural and machine-learning experts, and data strategy consultants based in 15 markets around the world.   

Looking beyond headline corporation tax receipts to the health of the corporate sector is key Budget 2024 is a first step towards meaningful support for entrepreneurs Use of tax policy as a lever to encourage landlords to remain in rental market will work for society and the economy   High time for childcare to be recognised as part of critical infrastructure     10 October 2023 – Reacting to today’s Budget speeches, Chartered Accountants Ireland has highlighted the importance of supporting enterprise across the country. The Institute represents over 32,700 members, two-thirds of whom work in business.   Supporting enterprise   Director of Public Affairs, Dr Brian Keegan commented  “A healthy corporate sector is critical to Ireland’s economic growth. Without it, the state simply doesn’t have the tax receipts to effect change across so many areas of the economy and society.    “It’s positive to see the focus switching away from the headline corporation tax receipts and the enterprise sector being singled out and supported. These businesses create significant local employment and deserve the support announced today of a €250 million fund to help meet the increased cost of doing business in 2024.   “We hope that the scheme is introduced in a timely manner as businesses are already grappling with additional costs of statutory sick pay, impending pension auto-enrolment and a significant uplift in the minimum wage to €12.70.”  Supporting entrepreneurism   The Institute has also noted the uplift in the R&D credit from 25% to 30% as well as an enhanced capital gains tax relief for angel investors. It states that these measures send the signal that Ireland is open for business and wants to support entrepreneurism.  Dr Keegan continued  “The R&D tax credit has been hugely successful in encouraging research and innovation and creating employment. New capital gains tax reliefs for angel investors should result in early funding being made available to businesses when they need it most – at inception. There have been few new initiatives for the corporate sector in the past decade, and it was positive today to see recognition of the sector to Ireland’s economy.”   Tackling housing  The lack of adequate, affordable, reasonably located housing for staff is one of the biggest barriers to expansion reported by Chartered Accountants Ireland members. The Institute said that today’s tax break of €600, rising to €1,000 over three years, announced for small, private landlords if they remain in the rental market will help to boost Ireland’s housing supply. Cróna Clohisey, Tax and Public Policy Lead said  “Small landlords are an essential feature of a fully functioning residential property market, and properties owned by these landlords are more likely to be in regional, less densely populated parts of the country, providing much needed rental stock in areas that are not as attractive to institutional investors.  “Today’s announcement for landlords will help stabilise the rental market and give more certainty to tenants but also importantly make it more attractive for a small private landlord to enter the rental market. Combined with an increased rental tax credit, the measures will go some ways to helping people access housing, and it will work for society and the economy.”  Childcare as a critical infrastructure issue   Today’s announcement of an increase in the national childcare subsidy (NCS) from €1.40 to €2.14 as well as extending the NCS to certain childminders will help with the cost of childcare but will not address significant capacity constraints within the market.   Clohisey continued  “The cost of childcare is unaffordable for many working parents and today’s announcement to increase the NCS from September 2024 is welcome. However, a survey of our membership last month shows that in addition to cost, the biggest challenge working parents face is a lack of available childcare places.      “While a commitment was made today to address supply issues through core funding, we are asking government to recognise that childcare provision is part of the critical infrastructure necessary for a functioning economy. The crisis needs to be addressed with a long-term strategy with children at the forefront, that adequately funds the sector, increases capacity, and supports working parents.”    ENDS      

Three Chartered Accountants share their perspectives on the changing role of the Chief Financial Officer in today’s fast-paced business, regulatory and societal environment Johnny Harte Founder True Fund Solutions  The Chief Financial Officer (CFO) in a company has long been considered the chief bean-counter whose job has been to say ‘no’ more than ‘yes’.  And in the past, this has been true. CFOs today still have responsibility for the core finance function in an organisation, but they are now increasingly regarded by management and key stakeholders as value-creation partners in a business, and their expanding role reflects this. As a starting point, to realise more efficiencies, CFOs are now investing more in technologies to assist the finance team. Transactional activities are being replaced by artificial intelligence and machine learning technologies, and the way in which financial information is being presented, shared and consumed has changed in line with the expectations of end-users. The CFO may have responsibilities outside the core finance function, too, like human resources and IT, so collaborating with many other departments in the business is more important than ever.  New initiatives to address issues such as environmental, social and governance (ESG) concerns fall under the remit of the CFO as well.  As an example, the financial implications and reporting obligations of ESG are felt company-wide, but they ultimately feed into the finance function. Companies find themselves in times of rapid change that offer potential opportunities, like product innovation, access to new markets, and even the development of new business models. Change can also result in potential risks such as cyber security, geopolitical and environmental concerns, however.  CFOs, by necessity, find themselves at the heart of all of this and play a vital role in navigating the landscape and advising on strategic decisions that can shape the future of the business. CFOs are in a unique position in a company in so far as everything that is important eventually gets reflected in numbers. The old line of “you can’t manage what you can’t measure” still holds true. Karen Sugrue Hennessy  Sustainability Consultant and CEO Real Leaf Farm As our nation, along with the rest of the world, faces mounting pressure to fulfil its climate change commitments, Chief Financial Officers (CFOs) are stepping into a critical leadership role.  According to the Environmental Protection Agency (EPA), Ireland is currently on track to achieve just 29 percent of its committed 51 percent net zero target by 2030. Finance stands as a pivotal enabler in the acceleration of climate action, as emphasised by the Intergovernmental Panel on Climate Change report (AR6).  CFOs, accountants, bankers and directors are primed to lead the charge by shifting their focus away from financing environmentally detrimental projects and redirecting their efforts toward funding initiatives that bolster the transition to a sustainable economic model. By 2029, all businesses, including SMEs, will be mandated to enhance transparency and accountability concerning corporate sustainability, operating under the Corporate Sustainability Reporting Directive.  Significant challenges lie ahead, however. Recent research conducted by LinkedIn revealed that close to 95 percent of financial professionals in 48 countries, including major European nations, lack essential green skills.  Shockingly, Ireland ranks at the lowest end of the spectrum in Europe, with just 0.16 percent of finance job postings related to green skills, according to LinkedIn data. So, where should CFOs begin their journey to upskill in this pivotal area, which is undeniably becoming a sought-after area of expertise?  An excellent starting point is joining Chapter Zero Ireland – a collaborative initiative between Chartered Accountants Ireland, IBEC and the Institute of Directors.  Chapter Zero’s primary purpose is to ensure that companies are well prepared for the future and that global net-zero aspirations translate into robust plans and measurable actions.  The evolving role of CFOs in Ireland is not merely a response to regulatory demands; it represents a unique opportunity for financial leaders to champion a more sustainable and responsible future for both their businesses and the nation.  Embracing this transformation is not only a strategic imperative but a moral obligation that can reshape Ireland’s path toward a greener, more prosperous future. Mark Mulqueen CFO KPMG Ireland Like other C-suite roles, the Chief Financial Officer (CFO) role has evolved significantly, reflecting the evolving landscape of business, technology, regulation, global markets and shifting expectations from internal and external stakeholders.  In addition to the traditional CFO responsibilities as financial ‘gatekeeper’, the role has broadened beyond core topics to become more like that of a strategic partner. At the centre of this evolution is a business appetite for greater insights, data-driven commercial partnering, and a more significant focus on profitability and an organisation’s need to transform operating models and core supporting technology.  Consequently, CFOs must keep up to date with the changing landscape of data, technology, taxation and compliance while also managing the organisation’s financial health. As business models continue to transform, looking to the future, this presents opportunities and challenges for CFOs. The value of data – going beyond traditional finance data to provide valuable insights to enhance forward-focused decision-making. Embrace the challenges of data – overcoming disparate systems with multiple data sources to ensure reliability and accuracy is critical to the role. Automation – managing the changing role of technology and staff in traditional finance processes. Talent retention and acquisition – with a broader set of new challenges, it is essential to have the right skills in the team to leverage the opportunity presented by data and technology. Risk – managing risks posed by fraud and cybercrime. Expectation gap – managing the strategic role of the CFO versus the volume of traditional finance work. Leveraging technology, adding new skills to finance teams, and managing this change will allow CFOs to help companies become more agile and responsive to market changes.  The result will provide more value through greater insights on a broader range of topics and the ability to support faster data-driven decisions through automation and technology while simultaneously supporting business change and managing new risks posed by regulation toward sustainable, profitable growth.  The one constant that will remain for CFOs is change.

The FRC have issued a project update relating to the ongoing periodic review of FRS 102 and FRS 105. In its update, the FRC noted that they received 54 response letters to FRED 82 and they are now preparing final amendments for issue which will take into account the responses received. Earlier this year, the Institute’s Financial Reporting Technical Committee issued a response to FRED 82. The FRC have indicated that they expect to issue the final amendments to FRS 102 and FRS 105 in the first half of 2024, with an expected effective date of periods commencing on or after 1 January 2026 for the changes. This is 1 year later than the date proposed in FRED 82. The FRC are working on amendments to the standards and provided updates on the revenue recognition and lease accounting sections which respondents provided feedback on during the consultation process. They will continue to work towards a “five-step model” for all FRS 102 and 105 preparers, while seeking simplifications to ensure proportionality for micro-entities. In addition to this, they have indicated that they will consider how to ensure that the “on-balance sheet” model of lease accounting under FRS 102 will be proportionate and understandable for FRS 102 preparers of all sizes.

There may not be many miles between Cork and Leeds, but there was certainly a big jump from the family dairy farm to FinOps for Donal Bourke. We caught up with Donal recently to hear more about his career journey.     1. Where did you grow up and where do you live now?  I grew up on a dairy farm in Co. Cork about 30 minutes from Cork City. The majority of my family and extended family worked (and still work) in agriculture, but I have bad hayfever, and a sense of adventure took me to UCC to study commerce. 2. What made you choose to become a Chartered Accountant?  When I finished commerce, I still didn’t know what I wanted to do. The majority of my class were doing interviews with the big-4 accounting firms, and it seemed like the path of least resistance. So, I went along and managed to secure a job with KPMG in the transaction services department. You could imagine my surprise to learn that there was a qualification and exam expectations involved in the path I had chosen! However the firm provided great support and time off to ensure I completed my exams and became an ACA. 3. Can you tell us a little about how you got to where you are today – both the geographical relocation and career path. And, what advice would you give your 20-year-old self? Once I completed my qualification I went to Sydney, Australia (as the majority of my intake did at the time which was 2011). From there I’ve moved to Leeds, back to Cork and finally to Leeds again using my qualification to work in a wide array of industries. I've gone from spuds to drugs, when I moved from being Financial Controller for a potato plantation in South Australia to being a Revenue Reporting Analyst responsible for generating rebate invoices from harnessing millions of lines of generic drug sales data. I now find myself back in Leeds (my wife is from here, so "happy wife = happy life!"), where I have undergone another career pivot working in the field of FinOps for NetApp. This involves analysing customers' public cloud environment (outsourced opex IT spend). The third party providers have different commitment options available for purchasing their services and I am responsible to use the best instruments to deliver the highest savings. The advice I would give my 20-year-old self would be to never stop learning and looking for opportunities to evolve in your career. It was only after being made redundant from a previous role in 2019 that I took ownership of my career and what I wanted to do and I wish I’d done it sooner. 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 value the transferability of the membership most. Whenever I have travelled, it automatically sets the bar for the type of roles I will be approached for. An ACA or FCA qualification means recruiters and employers know who they are getting. I think society can benefit from members having a more rounded experience and world view – personally and professionally. It is the unique experiences and mental connections we make which allow us to tackle problems in our own ways. With the pressing challenges of climate change and the uncertain nature of AI (artificial intelligence), our own rounded perspective is more important than ever. 5. As a member living away from Ireland, can you talk to us about how your membership has been of value to you within the UK, and what do you value about it now that you’re living there (and what would you like to see more of)?  I would love to see a more active district society and chartered community with networking opportunities outside of London. 6. What were the most significant/noticeable differences you encountered doing business and networking away from home and back in Ireland? Doing business, I’ve found no real differences between Ireland and the UK. My previous roles in Ireland were fully remote and I continue to work from home. One of the few good things to come out of Covid in my opinion.  In terms of networking, the biggest difference I’ve found is that I now have four small children, so the opportunities to network are limited but I look forward to building on that aspect once the kids become less of a handful. Pictured with Donal are his daughters, (L-R) Ornaith and Evelyn. Donal Bourke is a Cloud Optimisation Consultant with NetApp.

Welcome to this edition of Technical Roundup. In recent developments, Chartered Accountants Ireland are hosting a webinar Corporate Enforcement Authority – Insolvency on 5 October at 10am. This conversation is with Cathy Shivnan Director of Insolvency Supervision at the Corporate Enforcement Authority (CEA) and gives insights into the CEA’s insolvency agenda; the EU Commission has issued a guidance note for EU operators on implementing enhanced due diligence to shield against Russian sanctions circumvention. Read more on these and other developments that may be of interest to members below. Financial Reporting The UK Endorsement Board (UKEB) has issued a draft comment letter for public consultation in response to the IASB’s Request for Information on its Post-implementation Review (PIR) of IFRS15 Revenue from Contracts with Customers. The International Accounting Standards Board has published Exposure Draft Annual Improvements to IFRS Accounting Standards—Volume 11.  The document is available to download from the Open for comment section and from the individual project pages on the work plan. The European Single Markets Authority (ESMA) has published the annual update of its Reporting Manual on the European Single Electronic Format (ESEF). This includes technical improvements and additional clarifications. The European Financial Reporting Advisory Group (EFRAG) have issued their August update which summarises public technical discussions held and decisions taken during the month. In order for EFRAG to provide input to the initial phases of the IASB’s research project on the Statement of Cash Flows and Related Matters, EFRAG have issued an open call for tenders to assist in identifying uses and issues with the statement of cash flows. The IFRS Foundation has issued its August 2023 monthly news summary. This includes details of recent amendments to IAS 21, details of current consultations and requests for information and other matters of interest. Insolvency Chartered Accountants Ireland are hosting a webinar Corporate Enforcement Authority – Insolvency on 5 October at 10am. This conversation is with Cathy Shivnan, Director of Insolvency Supervision, at the Corporate Enforcement Authority (CEA) and gives insights into the CEA’s insolvency agenda. The session will include some background on Cathy’s career and her journey from Revenue to CEA along with the evolution of the CEA from the ODCE. This webinar is a free event and open to all. Earlier this week, the UK government published its response to the consultation on ‘The Future of Insolvency Regulation’, which ran between 21 December 2021 and 25 March 2022. The consultation sought views on a comprehensive package of reforms to the insolvency practitioner regulatory framework. This response includes a significant package of reforms which addresses the current weaknesses, closes a loophole in the framework, and provides opportunities for further reform. It will strengthen insolvency regulation and increase public confidence in the framework. Sustainability Accountancy Europe, in collaboration with the European Sustainable Business Federation, have issued a paper ‘5-step starting guide to a sustainable transition for SMEs’.  The paper presents 5 first steps an SME can take to begin their sustainable journey. It is vital to initiate the process, even with small steps, and gradually start preparing the business for what lies ahead. EFRAG and the Global Reporting Initiative (GRI) have issued a joint statement confirming that they have achieved a high level of interoperability between their respective standards in relation to impact reporting. EFRAG has published its final comment letters on the ISSB consultation on Agenda Priorities and SASB methodology. Sanctions The UK Financial Conduct Authority recently issued a publication on firms’ response to increased sanctions due to Russia’s invasion of Ukraine. In the publication the FCA set out key findings from its assessments of sanctions systems and controls and includes examples of good practice and areas for improvement. While the publication is in respect of financial services firms, the findings in relation to good practices and areas that need improvement may be of interest in any efforts to making improvements to the approach to identifying and assessing the sanctions risks that firms are exposed to. In September 2023 the EU Commission issued a guidance note for EU operators on implementing enhanced due diligence to shield against Russian sanctions circumvention. It is to help European operators to identify, assess, and understand the possible risks of Russian sanctions circumvention. It includes circumvention red flags related to business partners and customers and .The EU Guidance note is in the same vein as the summary AML Alert  Russia sanctions – Trade sanctions circumvention  which was  produced by the Accountancy AML Supervisors’ Group (AASG) from an extract from the UK Department of Business and Trade notice NTE 2023/08: Russia sanctions – Trade sanctions circumvention published 22 May 2023. Details of this notice were brought to members attention in a news item from Professional Standards Dept. of the Institute of August 23, 2023 where they alluded to awareness of the risk and obligations in relation to sanctioned goods as an important first step for those working in the accountancy profession so that they do not become party to the trade sanctions circumvention. Other News In September 2023 the UK Financial Conduct Authority (FCA ) announced a review of the treatment of domestic Politically Exposed Persons (PEPs) by financial services firms. The review will look at firms’ arrangements for dealing with PEPs based in the UK and will report by the end of June 2024. In the previous month of August 2023 it invited UK PEPs to share their experiences, including any problems they or their family members have encountered with the PEPs regime. The FCA has previously (in 2017 ) published guidance for how financial services firms should treat customers who are politically exposed persons when meeting their anti-money laundering obligations. The Financial Reporting Council (FRC) has welcomed the appointment of Peter Wyman CBE as the Institute of Chartered Accountants in England and Wales (ICAEW) first externally appointed Chair of the Board to modernise and strengthen the ICAEW’s governance and leadership. The Charity Commission for Northern Ireland is writing to over 250 charitable organisations, in preparation for work to begin on phasing out what is known as the “combined list”.  A list of all organisations the Commission is aware of, which may be charities but have not been registered yet, the combined list has been an integral part of the regulator’s work to manage registration of all charities in Northern Ireland. The European Securities and Markets Authority (ESMA), the EU’s financial markets regulator and supervisor, has published the annual update of its Reporting Manual on the European Single Electronic Format (ESEF). The Pensions Authority has published its 2022 Annual Report and accompanying statement from the Pensions Regulator. The Charities Regulator is holding a free webinar on Wednesday 27 September 2023 at 1pm to assist registered charities in preparing their annual reports. If you want to attend this you may register here. For further technical information and updates please visit the Technical Hub on the Institute website.

  In September 2023 the UK Financial Conduct Authority (FCA ) announced a review of the treatment of domestic Politically Exposed Persons (PEPs) by financial services firms. The review will look at firms’ arrangements for dealing with PEPs based in the UK and will report by the end of June 2024. In the previous month of August 2023 it invited UK PEPs to share their experiences, including any problems they or their family members have encountered with the PEPs regime. The FCA has previously (in 2017 ) published guidance for how financial services firms should treat customers who are politically exposed persons when meeting their anti-money laundering obligations.

On 1 September 2023, the Institute responded to the Financial Reporting Council (FRC) invitation for comments on their proposed changes to the “UK Corporate Governance Code” (‘Code’)*.  The proposed changes arise from a UK government request of the FRC to strengthen the UK Corporate Governance Code in specific areas following the recommendations arising from UK White Paper on “Restoring Trust in Audit and Corporate Governance” (‘White Paper’) published in 2022. Some of the key changes proposed to the Principles and Provisions applying to boards include: Setting out a revised framework of prudent and effective risk management and internal controls to provide a stronger basis for reporting on, and evidencing their effectiveness. Improving the quality of comply-or-explain reporting, taking account of recently published FRC research and reports, e.g. reducing boilerplate wording and requiring reports to demonstrate the outcomes of governance activities. Revising the responsibilities of the board and audit committee for sustainability and ESG reporting, and associated assurance in accordance with a company's audit and assurance policy. Aligning governance and reporting practices with changes to legal and regulatory requirements as set out in the Government's response to the White Paper, including strengthening reporting on malus and clawback arrangements. The Institute response welcomes FRC proposals that: discourage boilerplate reporting and encourage clear and concise disclosure on the reasons for any departure from the Code’s provisions, and how the Board has otherwise adhered to the overall principles of the Code. encourage consideration of and reporting (in accordance with established sustainability reporting standards) all material sustainability and ESG matters, including climate ambitions and transition planning, in defining business purpose, strategy, and values. increase the emphasis on workforce and broader stakeholder engagement, strengthening diversity and inclusion, and improves the effectiveness of remuneration policies and transparency. respond to some of the Chartered Governance Institute recommendations on board performance reviews and emphasis on improving board effectiveness. engage with emerging risks and opportunities such as artificial intelligence, for which the Institute have provided, in our response, some detailed considerations for inclusion in FRC guidance. Some of the key points highlighted in the Institute’s response focused on: The missed opportunity from limiting the update of the Code to reacting to legislative proposals rather than addressing learnings from corporate governance in recent years, including the principles and values (including ethics and healthy culture) that were lacking in respect of high-profile corporate failures. Highlighting the increasing role and responsibilities of Audit Committees, and the risks arising by mandating them as default for additional requirements versus ensuring the ability of the Board, who are ultimately responsible, to delegate roles and responsibilities as it sees fit in accordance with fiduciary duties. The lack of guidance and definitions for key terms used in the principles and provisions which, if provided, would provide for better understanding, and promote greater consistency, in many areas of the Code, including directors declarations on risk management and internal controls, audit and assurance policies, and narrative reporting. The importance of maintaining the principle-based approach to corporate governance that the Code has championed for over thirty years and to avoid deferring to requirements which are prescriptive, a matter of law and are not suited to a comply or explain model. The risk that established and effective practices for stakeholder engagement, reporting on future prospects and delegating oversight of sustainability matters may be lost based on the way some of the proposals are set out. The Chartered Accountants Ireland response to the FRC addressed all 26 questions and is available here. The FRC proposals are available on their website here. Níall Fitzgerald, Head of Ethics and Governance, Chartered Accountants Ireland   * The Code applies to premium listed companies on the London Stock Exchange and companies with a primary listing on the Irish Stock Exchange (and the Irish Corporate Governance Annex). Other organisations can voluntarily adopt the Code, for example, Chartered Accountants Ireland applies principles of the Code where they are relevant and commensurate to the Institute as a membership body.  

In September 2023 the EU Commission issued a guidance note for EU operators on implementing enhanced due diligence to shield against Russia sanctions circumvention. It is to help European operators to identify, assess, and understand the possible risks of Russian sanctions circumvention. It includes circumvention red flags related to business partners and customers that EU operators should watch for when they enter into a commercial relationship with a new trading partner . The EU Guidance note is in the same vein as the summary AML Alert  Russia sanctions – Trade sanctions circumvention  which was  produced by the Accountancy AML Supervisors’ Group (AASG) from an extract from the UK Department of Business and Trade notice NTE 2023/08: Russia sanctions – Trade sanctions circumvention published 22 May 2023  . Details of this notice were brought to members attention in a news item from Professional Standards Dept. of the Institute of August 23, 2023 where they alluded to awareness of the risk and obligations in relation to sanctioned goods as an important first step for those working in the accountancy profession so that they do not become party to the trade sanctions circumvention.

Wednesday 6 September 2023 – Earning potential for Chartered Accountants working in Leinster remains strong, with an average salary package this year of €118,578. The results of a new survey published today shows a notable increase in the average salary package of newly qualified Chartered Accountants, rising 6.6% to €62,866 compared to last year. The survey of approximately 1,000 Chartered Accountants, launched today by Chartered Accountants Ireland Leinster Society in partnership with Barden, Ireland’s leading accounting and tax talent advisory and recruitment firm, provides the most up-to-date guide to Chartered Accountant salaries and employment prospects in the Leinster region.   Strong remuneration packages The research, conducted by Coyne, shows earning potential across the profession remains strong, with €118,578 the average salary package for Chartered Accountants working across all sectors. This figure includes base salary, car or car allowance, and bonus. The remuneration package of members who qualified in the past two years increased by 6.6% from €58,967 in 2022 to €62,866 in 2023. Almost 9 in 10 (89%) of respondents overall say their total remuneration has increased in the past three years, compared to 86% in 2022. Two in five (39%) said their salary had increased by more than 25% this year. And four in five claim their total remuneration is expected to increase within the next 12 months. As part of the remuneration package, over 60% expect to receive a bonus in 2023.   The vast majority (87%) of members have a pension, with employers contributing an average 9% of their salary. After basic salary, this pension contribution is the most valued part of their package for 50% of respondents.      High job satisfaction and flexibility  Job satisfaction was high across all the metrics amongst those surveyed, with 76% of members satisfied with their work environment (73% in 2022); 68% happy with the salary they receive (62% in 2022); and 64% happy with work/life balance (unchanged on 2022). Half of respondents have been promoted in the last three years, with promotion highest amongst those working in practice at 77%.  Flexibility has become embedded as a feature of working life, with 75% of respondents employing a hybrid working model, up 2% on 2022. Only 1 in 10 respondents express concern that time spent working remotely will impact on their career progression. 7 in 10 value location flexibility, and over half of all members value flexibility in the shape of their working day (compressed hours, core hours, flexitime).  Automation and productivity The survey also shows the accounting profession is benefiting from technological advances, with 70% believing automation will have a positive impact on their career and almost half believing AI and big data will free up capacity to focus on higher-value parts of the job.  Des Gibney, Chairperson of Chartered Accountants Ireland Leinster Society, said:   “This year’s survey points to continued strong earning prospects for Chartered Accountants in Leinster. I’m particularly pleased to note the increase at the newly qualified level. This increase will play a crucial part in ensuring our profession remains attractive to the next generation – and will help us retain our top young talent in a very competitive market.   “I am also really pleased to see automation being so strongly embraced by respondents. Almost half agree that it will allow us to move further up the value chain in terms of the work that we do. This is already happening, with the work of Chartered Accountants transformed in recent years. It is really important that we communicate the breadth of opportunity in our profession to the next generation.”   Elaine Brady, Managing Partner at Barden, said: “Despite the backdrop of almost constant uncertainty over the past 12 months, the demand for accounting talent seen in 2022 continued almost unabated. Standing out from the crowd and attracting this much sought after talent is a key challenge for companies throughout Ireland. Accurate data on reward can create competitive advantage for those who choose to use it, especially in times such as these. These insights can also help businesses and hiring managers to craft competitive reward structures to aid talent retention and to understand what is required when looking to attract talent externally.  “It is also extremely interesting to see that 10% of members are working fully remotely, while 75% of members have hybrid working arrangements. Companies that mandate five days in the office have been, and will continue to be, at a significant competitive disadvantage when trying to attract accounting talent. To mandate five days in the office is to effectively reduce the talent pool available to you by 85%.” ENDS    Note to editors  The survey was conducted by Coyne Research on behalf of Chartered Accountants Ireland Leinster Society, in partnership with Barden, between 19 July and 14 August 2023.   About Chartered Accountants Ireland Leinster Society   Chartered Accountants Ireland Leinster Society is a district society of Chartered Accountants Ireland, representing over 16,000 Chartered Accountants throughout Leinster.     Chartered Accountants Ireland is Ireland’s leading professional accountancy body, representing over 32,000 members around the world and educating 7,000 students. The Institute aims to create opportunities for members and students, and ethical, sustainable prosperity for society. An all-island body, Chartered Accountants Ireland was established by Royal Charter in 1888 and now has members in more than 90 countries.     It is a founding member of Chartered Accountants Worldwide, the international network of over one million chartered accountants. It also plays key roles in the Global Accounting Alliance, Accountancy Europe and the International Federation of Accountants.     Chartered Accountants Ireland members provide leadership in business, the public sector and professional practice, bringing experience, expertise and strict standards to their work for, and with, businesses in every sector. Chartered Accountants Ireland engages with governments, policy makers and regulators on key issues affecting the profession and the wider economy.   About Barden Barden is a partner led talent advisory and recruitment firm consumed with supporting companies that really know the value of their people. Barden’s expertise covers Accounting, & Tax, Business Support, Financial Services, Legal, Life Sciences, Supply Chain and Technology talent advisory and recruitment. Chartered Accountants specifically choose to join Barden in order to use their qualification in a different way.   Barden has proudly partnered with the Chartered Accountants Ireland Leinster Society, for the last seven years, to bring you the annual salary survey. Barden also works closely with Chartered Accountants Student Society of Ireland (CASSI) and Young Professionals to make sure their members get access to the right information, at the right time in order to make more informed decisions about their professional future.  

Strong employer demand and higher earning potential for accountants    Accounting bodies congratulate Leaving Cert class of 2023; welcome 27% increase in those taking accounting in last five years    Friday 25 August – The body representing professionally qualified accountants in Ireland has said it is vital that accountants remain on the government’s Critical Skills Occupations List. Its call comes as it responds to the Department of Enterprise, Trade and Employment’s public consultation to review the eligibility of occupations on this list. The list is subject to regular review to ensure it reflects shortages of critical skills required for the proper functioning of the Irish economy. The Consultative Committee of Accountancy Bodies - Ireland (CCAB-I) is the representative committee for Chartered Accountants Ireland, the Association of Chartered Certified Accountants (ACCA), the Institute of Certified Public Accountants in Ireland (CPA Ireland) and the Chartered Institute of Management Accountants (CIMA). Its 43,500 members work across industry, professional practice, and the public sector. Commenting, Crona Clohisey, Tax & Public Policy Lead, Chartered Accountants Ireland said, “The accountancy profession plays a pivotal role in delivering professional services and advice to all sectors of the Irish economy, but presently most firms in which CCAB-I members operate have active vacancies that they are unable to fill. There is a critical shortage of accountants with audit experience; and a deficiency of accountants with practice experience of all types, including tax, data analytics, consultancy, and sustainability.  “The accountancy profession plays a pivotal role in delivering professional services and advice to all sectors of the Irish economy, but presently most firms in which CCAB-I members operate have active vacancies that they are unable to fill. There is a critical shortage of accountants with audit experience; and a deficiency of accountants with practice experience of all types, including tax, data analytics, consultancy, and sustainability.  “In the larger firms in particular, over half of new recruits filling vacant positions for experienced hires are currently being sourced from non-EEA countries due to a significant shortage of suitably qualified EEA-based candidates. Therefore, the inclusion of accountants on the Critical Skills Occupations List helps to meet ongoing capacity shortages.”  CCAB-I notes that the problem will be compounded by global trends and challenges. The Corporate Sustainable Reporting Directive (CSRD) will bring all quoted and large companies (as defined) within scope of a new set of sustainability reporting and assurance requirements from 1 January 2024. In addition, Ireland is bidding to host the new European AMLA (Anti-Money Laundering Authority), and if successful, there will be a considerable demand for accountants with AML and Combatting Terrorist Financing (CTF) skills. Building the talent pipeline CCAB-I is engaged with the National Apprenticeships Office (NAO) on the potential creation of a new national professional accountancy apprenticeship to facilitate the entry of school leavers into the profession on an “earn and learn” basis. It is also liaising with the Department of Education on the reform of the outdated Leaving Certificate accounting syllabus as part of wider efforts to attract candidates into the profession.  There are 16,500 students studying to become accountants in businesses and firms around Ireland, and in addition to strong demand from employers, there is continued strong earning potential, with newly qualified Chartered Accountants receiving an average salary package of €58,967 in 2022. Commenting Brian Feighan, Chair of the CCAB-I Working Group on Leaving Certificate Syllabus Reform said;  “Looking at the results for Leaving Certificate Accounting, it is really encouraging to see a 27% increase in those taking the subject since 2018, and an increase in those taking higher level. But this increase in popularity at second level is not feeding through to sufficient take-up of places on accounting courses in third level and further education.  “We have long highlighted that students are being dissuaded from pursuing accounting as a career choice because of the outdated Leaving Certificate accounting syllabus. We are engaged with the Department of Education to prioritise the introduction of a new specification for Leaving Certificate Accounting which will better reflect the role of the accountant in today’s workplace.  “A huge amount of work is being done by the CCAB-I at second level to attract students into the profession. I would say to students receiving their exam results (and their parents), that employer demand for accountants is extremely strong. Salary levels for qualified accountants reflect this demand and the vitally important roles that accountants perform in all organisations. There have never been more ways to enter the profession, be it directly from school, or after third level. This demand continues to grow and so too does the range of opportunities.” Read the CCAB-I submission in full here.

The Financial Reporting Council (FRC) has launched a consultation on revisions to the Ethical Standard. The proposed revisions enhance prohibitions where an audit firm's independence could be threatened. There are also changes proposed to reflect findings from audit inspections and enforcement cases, as well as changes to reflect developments in the International Ethics Standards Board for Accountants (IESBA) since the FRC last revised the standard in 2019. The consultation remains open until 31 October 2023.

The International Auditing and Assurance Standards Board (IAASB) has issued its proposed International Standard on Sustainability Assurance (ISSA) 5000, General Requirements for Sustainability Assurance Engagements. This proposed standard will now undergo a consultation period running until 1 December 2023 and stakeholders are encouraged to respond and share their feedback to the proposed standard. ISSA 5000 is a principles-based, overarching standard suitable for both limited and reasonable assurance engagements on sustainability information reported across any sustainability topic. It is intended to work with various sustainability reporting frameworks (including the European Sustainability Reporting Standards and the IFRS Sustainability Disclosure Standards). The standard is drafted as a profession agnostic standard and should be suitable for use by accountant and non-accountant assurance practitioners. With the sustainability reporting requirements for certain entities set to increase over the coming years, a standalone sustainability standard is seen as a key piece of the framework to help ensure that users of sustainability information can place greater trust in the information they are consuming on an entities Environmental, Social and Governance impacts. In launching the consultation, IAASB Chair Tom Seidenstein commented “Our proposed ISSA 5000 is a crucial step in enhancing confidence and trust in sustainability reporting. This proposal directly responds to the International Organization of Securities Commissions recommendations and complements the work of other standard setters, including the International Ethics Standards Board for Accountants,”. The comment period remains open until 1 December and the IAASB are seeking a broad range of views on the standard to gather the views and insights needed to finalise it.

Julia Rowan answers your management, leadership and team development questions I am an experienced manager who is comfortable with delegating work and trusting my team to get on with it. This allows me to keep a strategic focus. I moved to a new organisation recently and find that my manager and other senior leaders expect me to have detailed knowledge of the work of my direct reports. I do not want to get sucked into operational detail. How do I stay high level while keeping my seniors happy? I always put options on a continuum of ‘do nothing’ (i.e. comply) to ‘the nuclear option’ (i.e. leave), and then identify the options in between.  Before you begin, reflect carefully on what is important for you so that you can shape a clear and positive message. Watch the language – are you ‘getting sucked into the operational detail’ or ‘on top of the data’? My guess is that this is a cultural issue, and if you want to effect change, you need to remain credible. Reflect on what the seniors need: do they need you to have information at your fingertips to save them time? To make important decisions? Are there trust issues around work done by more junior people? Is there something else?  Working this out will help you to meet seniors where they are (not where they ‘should’ be). Ask your manager for their support in meeting expectations while contributing at a higher level (focus on both/and rather than either/or). Bring the same question to your team and get their input and solutions. Reflect on your own expectations – you may need to give a little.  Identify the colleague who navigates this most effectively – ask them how they do it. Build the profile of your team: bring them to meetings. Find a reason to host an event at which your team members share their insights, demonstrate their capabilities and build relationships with your seniors. There may be practical solutions. Could you contact seniors before meetings to check if there are issues they want to discuss? Maybe you could create a shared folder where updated information is posted (either so that you can access it quickly – or colleagues can access it). There are a few options in between. There are many more. Just be open to looking for them. Two colleagues who don’t get on keep trying to drag me into their issues. I feel caught in the middle. In such cases, tapping into our sincerity often gives us the clarity and courage to address tough issues. My guess is that you want to support both without siding with either. Imagine one of your colleagues is sitting in front of you. What would you most like to say? It might be “I am uncomfortable as I feel stuck in the middle” or “That sounds difficult. How can I help you to address this with him?” or “It can be hard to work with someone whose style is so different”.  Try it and see what comes out. Then whittle that down to a sincere and helpful response. Julia Rowan is Principal Consultant at Performance Matters Ltd, a leadership and  team development consultancy. To send a question to Julia, email julia@performancematters.ie.

Audit committees face increasingly complex risks in modern business, according to the latest KPMG survey. Arlene Harris speaks to Niall Savage about the four main risks and how committees can mitigate them KMPG recently published the results of its Global Audit Committee (AC) Institute survey, which collates the views of 768 AC members and chairs, of which 31 were operating in Ireland.  Niall Savage, Partner and Head of Audit Markets at KPMG, says the survey results indicate that, while it may seem at odds with its traditional role, the AC and its members continue to have a “bellwether role for the business as they scan the risk horizon”.  Consequently, ongoing geopolitical issues, cyber threats, the rise of artificial intelligence (AI) and considerations around environmental, social, and governance (ESG) will remain top of the AC agenda in the coming months. “The traditional and essential role of an AC is overseeing the numbers, controls and, as its title suggests, the audit process – both internal and external,” he says. “So its priority is more in the monitoring than the advising. This work is critical for ensuring financial transparency, confidence and compliance but does not encompass the broader aspects of business. “However, given the typical composition of the AC, the external non-executives with wide-ranging experience, the effective AC Chairperson draws upon the insights of their members to identify and advise on risk areas and strategies to address them.  “The findings suggest that the things driving the agenda of the AC are big-picture risks that underpin their organisations’ strategies. And four key themes – geopolitical, cyber, AI and ESG – were identified as foremost in the minds of AC members.” Indeed, these four themes don’t come without challenges, but there are ways in which ACs can navigate them in their role, supporting the board and management. The effects of risk on the market “Volatility by its nature creates uncertainty in the market, making it difficult for businesses and their stakeholders to make strategic operational and investment decisions,” says Savage. “For example, consumer sentiment in uncertain times can fall rapidly, with non-essential purchases frequently deferred, impacting large parts of the consumer market and leisure industries. “Geopolitical volatility can also undermine investor confidence, cutting off access to finance and creating barriers for businesses through restricted access to markets, currency fluctuations and shifts in trade policies. There is also a heightened risk of supply chain disruption.” In the last 12 months, ACs have been faced with:  post-lockdown uncertainty, which is driving cashflow forecasts (and risks) of how to meet consumer demands; geopolitical conflicts, such as the Russian invasion of Ukraine, necessitating a rapid response to secure the safety of people and assess the impact on the business in addition to instability in Latin America and the Middle East; rapid and often unexpected inflation across energy, wheat and other commodities, which created unforeseen risks of business failure if these could not be passed on easily; increased interest rate rises and global financial market fluctuations in response to inflation, which changed base case forecasts for investment decisions, funding, and potentially going concerns; ongoing global trade tensions, including those between the US and China, with increasing tariffs, which had ripple effects on global supply chains; and the fallout from COVID and Brexit, which continued to affect the global economy. Geopolitical risks “It is difficult to predict what the next 12 months have in store, but some key actions for AC members to manage these risks include engaging with management and stakeholders to understand their assessment of geopolitical risks and existing strategies to mitigate those risks, and asking management to provide timely updates on geopolitical developments and the organisation’s risk mitigation efforts,” said Savage.   “Also, understanding the geopolitical risks that can impact the organisation and monitoring global political developments, regional tensions, trade disputes, regulatory changes and other geopolitical factors that may have implications for the organisation. “And, staying informed about current events and diplomatic developments that can impact the organisation’s operations – along with knowing if the organisation is especially exposed to certain regions or risks, should the AC consider recruitment or training to ensure that they have the expertise to address any challenges they face, is also important.” Savage also suggests assessing an organisation’s exposure to geopolitical risks, understanding management’s approach to contingency planning, and understanding the full list of regulatory compliance requirements and whether the organisation has processes in place to identify, monitor and adhere to applicable regulations.  ACs must also consider with management the need for scenario planning to model impact and respond to geopolitical events. Cyber risks Advances in modern technology have also brought about a growing number of cyber threats, and in the past 12 months, many Irish businesses and organisations have reported data leaks and thefts as cybercriminals become more sophisticated and professional in their approach to both getting access to systems through ransomware and social engineering but also monetising this access.  As firms try to protect themselves from this, the list of targets and potential weaknesses continues to grow with the proliferation of the internet of things (IoT), which may not have the same level of security and is, therefore, easier to compromise. “For those engaged in public work, there is an additional political dimension and risk to cybercrime with nation state targeting for political gain, which has seen recent coverage of European Commission staff removing certain apps from their phone restrictions on Telco suppliers due to concerns over security,” says Savage. “But there are some essential actions that ACs can take, which include understanding the cyber risk landscape, the type of threats it faces, potential vulnerabilities and the impact of a cyber incident.  “They can also evaluate the organisation’s cybersecurity governance and strategy while focusing on risk assessment, incident response, training and vendor competence. It is important to be informed – stay on top of cybersecurity initiatives and maintain open lines of communication to address any concerns or gaps identified.” He would also encourage organisations to consider engaging external cybersecurity experts or conducting independent audits/penetration testing to assess the effectiveness of these controls, to ensure the AC is informed of cybersecurity incidents and evaluate the organisation’s response and promote cybersecurity awareness through training and incident reporting and ensure that appropriate cybersecurity risk reporting mechanisms are in place. AI risks The advent of AI has brought a new set of risks to business. “Although long discussed and the subject of many films (Terminator 2 springs to mind), the potential impact of AI really hit home late last year with the launch of ChatGPT, which was quickly followed with spectacular claims of cost savings, entire professions wiped out and of course the danger of ‘the rise of the machines’,” says Savage. “Clearly, there are significant risks and opportunities for businesses and ACs to deal with, many of which are ‘unknown unknowns’ to combat this and assess risk.” In the face of this new business landscape, “ACs should understand the concerns and opportunities for people, customers, suppliers and regulators. They should try to understand how best to get the right level of knowledge, evaluate the existing risk management framework to assess whether additional controls are needed, consider policies around the implementation and use of AI and review critical AI implementation projects.” ESG risks The final issue Savage addresses is ESG, which he says has been an “alphabet soup of regulation” for the past few years – and KPMG research indicates compliance with standards is only one of the ESG risks occupying the minds of AC members.  “There is a broader menu of risks to consider, which impact reputation, performance and financial success,” he says. “Failure to address these can lead to reputational damage and financial implications. So, AC members should consider the potential reputational risks associated with the company’s ESG performance and how they are managed. Climate change risks can impact the value of assets, and non-compliance can result in fines or penalties.”  To address these risks, it is important for ACs to understand and work closely with all stakeholders including management and internal auditors. Areas of focus should: ensure the AC has the necessary expertise to effectively assess ESG risks – this may involve recruiting or training existing committee members; engage with investors, regulatory bodies and industry associations to understand their expectations and perspectives on ESG; develop a list and understanding of ESG risks relevant to the company across climate change, labour, data and inclusion and diversity; review how data is currently captured and analysed and how reporting is verified; look at the existing risk management practices and policies and assess the key controls and how the risks are currently monitored and reported; benchmark these to peer groups and industry standards to ascertain whether they align with recognised frameworks; and seek regular updates on ESG initiatives and consider external assurance on related reporting.  “There are more insights to the survey, and it is interesting to benchmark different priorities across the regions, priorities around finance team talent, the need for in-person time with management and a focusing agenda to maximise effectiveness,” says Savage. “However, by elaborating on and identifying some common-sense actions on the four critical themes – geopolitical, cyber, AI and ESG – we have supported AC members for the next, hopefully, less volatile, 12 months.”  

The NATO summit was not only about Ukraine. It was about the role of the past and how it affects NATO and the EU, writes Judy Dempsey By the time you read this, we’ll have all moved on from the NATO summit that took place in the Lithuanian capital of Vilnius in July towards other persistent topics.  There’s Ireland’s housing crisis; the worry that Donald Trump might beat President Joe Biden in the 2024 election for the White House; and Russia’s continuing war against Ukraine, to name a few. The list is long. But a common threat runs through these issues: the enduring role of the past and how societies in the 21st century have to deal with it. The past is a compass. It offers the way to the future if there is a political willingness to deal with history. The past can also be distorted.  That sense of the past was clear when attending the NATO summit.  The summit’s conclusions fell short – for some, way too short – by failing to offer Ukraine membership of the US-led military alliance once the war was over.  Lithuania and the other two Baltic States, Estonia and Latvia, but also Poland and the Czech Republic, were disappointed. They believed that Biden and German Chancellor Olaf Scholz, who led the opposition against a membership date, did not have the political courage or historical compass to offer Ukraine at least a timetable.  The bottom line is that, for different reasons, this decision was about Russia.  Biden, who is facing re-election and simmering unpopularity with American support for Ukraine, does not want to drag NATO into a direct confrontation with Russia. Germany thinks the same but is not committed to admitting Ukraine to NATO. Yet, this war has given Germany a big chance to lead Europe and create a strong NATO caucus inside the alliance. Germany demurred.  This brings us to Lithuania.  It has been a staunch ally of the Belarussian opposition and an unremitting supporter of Ukraine. For Lithuania, it is about Kyiv defeating Russia. But it is more than that. Lithuania and the other Baltic States see the war in Ukraine through the prism of Russia but in a special way, distinct from Western Europe.  For Lithuania, this is about Russia trying to regain control over the countries of Eastern Europe, which include not only Ukraine but also Belarus, Moldova, Georgia and Armenia.  Lithuania also sees Russia aiming to create a new cordon sanitaire between the EU/NATO countries and Eastern Europe – a kind of updated version of the Cold War divisions of Europe.  In the view of the Central Europeans, Russia’s imperial ambitions must be stopped. Eastern Europe must not be turned into a grey Russian-controlled zone. The prospects for instability would be too high and dangerous. Germany and the United States, for their part, see the war in Ukraine through the prism of Russia as a nuclear power and threat – as if Russia is not already threatening the security of Europe. They do not see it in terms of the past but in terms of realpolitik. For Central Europe, the past is the legacy of the violent Soviet occupation of the region that must not be repeated in Ukraine.  The past for Western Europe is how, with huge American support, today’s EU was built. It was a peace project constructed upon the ruins of World War Two. This peace project is now being challenged by Russia. The war in Ukraine is about two different European narratives. It is time to reconcile them.  Judy Dempsey is a Non-Resident Senior Fellow at Carnegie Europe and Editor-in-Chief of Strategic Europe