FRC signs contracts with 3 international standard-setters

The Financial Reporting Council (FRC) has recently signed contracts with three international organisations that set and develop accounting and auditing standards. 

The three organisations are the International Financial Reporting Standards Foundation (IFRS Foundation), International Foundation of Accountants (IFAC) and International Valuation Standards Council (IVSC). 

A press release issued by the FRC – the government regulatory body for professional accountants and accountancy profession – yesterday said this.

These standard-setting bodies follow a thorough, transparent and participatory process when issuing any standard, practice note or an interpretation that helps companies better implement the standards.  

Now 166 countries are in the process of adopting IFRS, 170 members from 130 countries are using the IFAC published auditing standards.

And the IVSC has more than 130 member organisations from around the world.  

The IFRS Foundation develops and sets standards, interpretations for accounting and financial reporting – known as IFRS, International Standards on Auditing (ISAs), IFRIC interpretations. 

The IFAC develops and sets standards, code of ethics, practice notes for auditing, assurance, review, and other related services – most widely used and known as ISAs – for professional accountants working in the profession and businesses.

The IVSC develops and sets International Valuation Standards (IVS) for businesses and assets valuation services.  

IFRS, ISAs, code of ethics have been in practice in Bangladesh's accounting and auditing profession through the Institute of Chartered Accountants of Bangladesh for more than a decade. 

With the enactment of Financial Reporting Act (FRA) 2015 and signing of the contracts with the international standard-setting organisations, these standards are now being included in the national law. 

IVS for the valuation of businesses and assets will be a new set of standards for valuation practices in Bangladesh. 

Enactment of FRA and setting up of FRC in Bangladesh mark a turning point from self- regulation to government regulation and oversight.

This is also the first of its kind among the South Asian Association for Regional Cooperation (Saarc) countries. 

The purpose is to bring financial reporting and audit reporting of corporate and business organisations, and companies – also known as public-interest entities (PIEs) – under a well-regulated structure to ensure high-quality financial reporting and auditing with integrity, transparency and trustworthiness. 

This is a step forward in protecting the public interest and addressing concerns of the capital market stakeholders.