A new OECD report urges international governments to create standards for boards ...

BY JOURNAL



Independent Boards Worldwide

An advisory group of the Organisation for Economic Co-operation and Development has published a report that urges international governments to create and issue standards for boards of directors. Corporate Governance: Improving Competitiveness and Access to Capital in Global Markets calls on the governments and regulators of the OECDs 29 member countries to support efficient, credible and adaptable governance practices.

According to the report, the focal point of corporate governance is the board of directors, which is charged with monitoring management on behalf of its shareholders. The advisory group argues that, for such boards to be effective, they must be independent.

The advisory group recommends that the OECD encourage its member countries to create corporate governance regulations and standards to promote fairness, transparency, accountability and responsibility. It also suggests the OECD issue best practices guidelines on independence.

Copies of the report are available in English, French and German by calling the OECD communications division in Paris at 33-1-45-24-80-88/80-89 or by e-mail at news.contact@oecd.org .

New ED on Government Reporting

In an attempt to fill a void in international standards for public-sector entities, IFACs public sector committee (PSC) issued for exposure Guideline for Governmental Financial Reporting . The draft describes the most common forms of government accounting and gives best practices examples of each.

The PSC guideline is not an accounting standard. Rather, it is intended to provide governments worldwide with a platform for a common understanding of the key principles of government accounting methods. According to the ED, which does not prescribe any one method, the four most common bases of accounting used by governments are cash, modified cash, accrual and modified accrual. The guideline endorses their use as a means to ensure more reliable, comparable information about the financial performance and position of governments.

Governments are competing with private-sector entities for capital, said John Gruner, IFAC director general. By making their financial positions more transparent, governments will be better able to get the capital they need.

Comments on the ED are due by July 31, 1998.


Standardizing the future
The PSC also is drafting a set of standards on accounting and financial reporting by governments that will be based on international accounting standards (IASs). IFAC develops IASs generally for private-sector entities using the accrual basis of accounting. The PSC is determining which IASs can be applied under all four methods of accounting for governments.


A very busy IFAC
The IFAC also issued four other publications for its member organizations: an exposure draft, Implications for Management and Auditors of the Year 2000 Issue ; a paper, An Advisory on Examination Administration ; an international management accounting study, Environmental Management in Organizations: The Role of the Management Accountant ; and a revised international management accounting practice statement. The documents are available by phone at 212-286-9344 or online at
www.ifac.org .

Comments on the governmental financial reporting exposure draft may be e-mailed to EDComments@ifac.org .



SPONSORED REPORT

Year-end tax planning and what’s new for 2016

Practitioners need to consider several tax planning opportunities to review with their clients before the end of the year. This report offers strategies for individuals and businesses, as well as recent federal tax law changes affecting this year’s tax returns.

QUIZ

News quiz: IRS warning on cyberattacks and a change in pension rules

Once again, the IRS sounds the alarm about a threat from cyberthieves. See how much you know about this and other recent news with this short quiz.

CHECKLIST

Bolster your data defenses

As you weather the dog days of summer, it’s a good time to make sure your cybersecurity structure can stand up to the heat of external and internal threats. Here are six steps to help shore up your systems.