Accounting Harmonization in ASEAN

https://gupea.ub.gu.se/hande/2077/2499
E.D. Radianto, Wirawan
Yuta Chairas, Ira
2002
Accounting harmonization is becoming a big issue in the ASEAN region, since the ASEAN
countries are now acing the g!oba!ization era, where the interest o internationa! business
and in"estment becomes greater or this region. #he ob$ecti"e o this stud% is to ind out
how the &rocess o accounting harmonization is ta'ing &!ace and to in"estigate to what
degree there is accounting harmonization in ASEAN region. (urthermore, this research aims
to stud% which eorts are made b% ASEAN (ederation o Accountants )A(A* to achie"e
accounting harmonization and to &ro&ose to A(A how to aci!itate the eort to achie"e
harmonization at a regiona! !e"e!. #hrough an ana!%sis o data and em&irica! indings we
ound that a!though se"era! obstac!es e+ist, regiona! harmonization is beneicia! or ASEAN.
Regiona! harmonization in ASEAN de&ends on the eort o each ASEAN countries. In the
case o nationa! !e"e!, we ound that most nationa! accounting standards com&!% or are
mo"ing to com&!% with IAS with se"era! modiications. (rom em&irica! stud%, we ound that
in man% res&ects most com&anies use the same "a!uation methods. ,oreo"er, we suggest
A(A im&ro"es its unction with de"e!o&ing the organization structure and increasing good
re!ationshi& with regiona! ca&ita! mar'et and go"ernment rom each member countr%.
International Finance >
Journal of International Financial Management & Accounting >
Vol 8 Issue 1 >
Abstract
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Accounting Regulation in A!"AN) A %*oice bet+een t*e $lobal an, Regional (ara,igms
of 'armoni-ation
http://onnebrary.wey.com/do/10.1111/1467-646X.00015/abstract
'( S$a$ro)$ M( Sauda*aran
'
and
+( Joselito G
,( '--.
/( 0$is paper analy1es accountin* re*ulation in AS%AN countries in t$e conte2t of t$e *lobal and re*ional
paradi*ms of accountin* $armoni1ation( !t uses a comparative framewor) to $i*$li*$t t$e similarities and differences
in t$e re*ulatory environment of five AS%AN countries( 0$e re*ional paradi*m is discussed in t$e conte2t of t$e
AS%AN 3ederation of Accountants4 efforts towards re*ional $armoni1ation w$ile t$e *lobal paradi*m loo)s at
members countries4 adoption of !ASC standards( 0$e paper e2amines forces drivin* *lobal $armoni1ation in AS%AN
and discusses t$e economic and political conditions for re*ional $armoni1ation w$ic$5 unli)e in t$e %65 do not yet
e2ist in AS%AN( !t concludes t$at t$is $as led to t$e dominance of t$e *lobal paradi*m of $armoni1ation in AS%AN
countries(
International
Accounting and
Auditing Practice
http://aap.actveboard.com/t54273272/answers-about-accountng-harmonzaton-
n-asean-benets-mod/
+7',
P#S0S &Y SARA
8'( 9$at are t$e possible benefits of accountin* $armoni1ation in AS%AN:
A'( '; !t can save costs for MNCs( +; !t en$anced compre$ensiveness and
comparability( ,; !t is t$e best accountin* practices( /; Low cost accountin* standards(

8+( 9$at are t$e disadvanta*es in accountin* $armoni1ation: !f t$ere are any(
A'( '; Accountin* $armoni1ation means every members in AS%AN will ad<ust t$eir
accountin* standards5 so t$ey will estimate t$e difference between t$eir members5 and
it will lead to every countries learn and compare t$eir accountin* standards to ot$ers( !t
must be spend a lot of manpower and material resources( So t$e cost will be $i*$( +;
Accountin* $armoni1ation also means t$e local accountin* standards will be c$an*ed5
so many lar*e companies5 especially international companies5 t$ey will *ive up t$e local
accountin* standards5 accept international accountin* standards( 0$ese conversion
costs will be undertoo) by t$ose companies(

8,( ow will t$e different cultures and lan*ua*e be not a barrier to t$e implementation
of AS%AN $armoni1ation:
A,( =ifferent cultures and lan*ua*e are t$e very important barrier to t$ose AS%AN
members( !n terms of lan*ua*e5 once implement accountin* $armoni1ation5 %n*lis$
would be official lan*ua*e5 t$at means all members in AS%AN use %n*lis$5 even t$ey
$ave t$eir local lan*ua*e( !n terms of different cultures5 as we all )now5 we cannot
c$an*e cultures5 but we can *et used to it5 t$is means every members in AS%AN s$ould
try to fit it(

8/( ow can t$is $armoni1ation beneficial to underdeveloped country:
A/( 3or t$eir lar*e companies5 t$ey can try to use international accountin* standards5
t$ey can learn from ot$er countries( So t$ese actions will benefits to t$emselves and
t$ose local small companies( 0$is will reduce t$e *ap between t$emselves and t$ose
better countries5 t$ey can learn a lot from it(

8>( 9$at is t$e role of t$e AS%AN 3ederation of Accountants ?A3A; wit$ re*ards to
accountin* $armoni1ation in AS%AN:
A>( 0$e purpose of A3A is to develop accountin* $armoni1ation and promote
accountin* profession( elpin* t$ose members in AS%AN in accountin* $armoni1ation
and ot$er areas are also belon* to t$eir <ob( ! t$in) $avin* A3A will improve all members
development5 not only on accountin* $armoni1ation5 but also in many ot$er aspects(
A!"AN "conomic %ommunit. / 0112) "conomic %om3etiti4eness for
!ustaine, $ro+t* an, t*e Im3lication for ",ucation Mar5et
http://papers.ssrn.com/so3/papers.cfm?abstract_d=2225814
(aul I6 Louangrat*
&an*)o) 6niversity @ 0$e !nternational Colle*e
3ebruary +.5 +7',
Abstract)
Ths paper s organzed nto ve sectons. Sectons 1-3 expan economc compettveness
and sustaned growth n the context of the ASEAN Economc Communty (AEC-2015). Secton
4 dscusses the nternatona standardzaton of educatona currcuum among the ASEAN
countres, and concudes that standardzaton w come through market mechansm. Secton
5 concudes wth the mpcaton for Tha unverstes n the New Economy. No state pocy
can brng about harmonzaton of educaton n the ASEAN. The ten member countres are too
dverse to be harmonzed. Educaton, unke trade and taxaton cannot be easy harmonzed.
The educaton system n each country embodes the hstory, cuture and the potca w of
the peope. The natona sentment and natona prerogatve w take precedent over the
drve for a regona commonaty. Smar attempt n harmonzaton of educaton n a common
market by the European Unon (EU) after 50 years of ncessant ehort has faed. It s not
key that the AEC w repeat that faure anew. A more practcabe approach s an
nternatona standard that s acceptabe to ten countres and s an nternatona standard
that s ndependenty and gobay recognzed: standardzaton through professona
certcaton or desgnaton by chartered professona assocatons, such as the ACCA for the
accountng professon, CFA for the nance professon, and ICPM for the management
professon. Ths mode for nternatona standard s not harmonzaton, but unformty n
standard. Harmonzaton means each country must foow one form of currcuar prescrpton.
Such an attempt fas even before t s conceved. Standardzaton by means of
nternatonazaton under the certcaton process through unform examnatons woud
satsfy a member countres. More mportanty, professona certcaton process s acheved
through neutra market mechansm that functons as a check-and-baance n quaty contro
process of unversty educaton. The contrbutons of ths paper are two fods. Frst, the
anayss of compettveness and sustaned growth for the regon ntroduces no econometrc
modes deveoped through Bayesan nferenta approach. Second, the concept of
nternatonazed educaton mode as a means to acheve a common nternatona standard
through market mechansm s a practca approach to synchronze educatona nsttutons
and market demands. Ths paper bunty re|ects the dea of harmonzaton of educaton n
the AEC as mpractcabe. In dscussng the educaton market, Thaand s used as a case
study. The ratonae for seectng Thaand as a case study s supported by the fact that
educaton market n Thaand s mature. It has gone through ts fe cyce; n order to reman
compettve these prvate unverstes must be nternatonazed.
Accounting
Harmonization by 2014
https://www.scrbd.com/doc/88086611/Accountng-Harmonzaton-by-2014
by Vkram Nan
Accounting Harmonization by 2014?The Harmonization in the Accounting world, specifically the transition to thenternational
!inancial "eporting #tandards $!"#% has been a ma&or contro'ersialtopic tal(ed about in the accounting world for the last few
years) *ore recently ithas been stressed on whether it can or will be occurring by the 2014 deadline) 11+countries around
the world ha'e already adopted !"#) These countries eitherre,uire !"# or are beginning use and allow !"# in their
company)$-ac(grounder% The .nited #tates is not yet in this group of countries) Although,there are actions being ta(en to
ha'e the .nited #tates using !"# by the year2014)
International Financial Reporting Standards is not going to be aneasy task to accomplish by
2014. The American Institute o !ertiied"ublic Accountants #AI!"A$ has began to reali%e
the amount o money and time that is actually going to ha&e to go into changing thestandards o
ho' the entire (nited States companies are completingtheir inancial statements. They belie&e that
they can help make thetransition smoother and easier on the (nited States companies. Theyclaim
they are going to urther educate AI!"A members) as 'ell) ashelp accounting educators) te*tbook
authors) related ma+ors) collegesand uni&ersities on all aspects o IFRS. They also say they are
goingto make sure that the &oice o (nited States !ertiied "ublicAccountants #!"A$ are heard
internationally and are not going to beo&erlooked. They also are going to start to include ,uestions
on the(niorm !"A -*am about IFRS. The AI!"A are deinitely goingout o their 'ay to try and
help this transition go a lot more smoothand suicient but at the same time reali%ing the cost.
#.ackgrounder$This is +ust ho' one organi%ation is going to help but there are manymore costs
coming out o this adoption rom /enerally AcceptedAccounting "rincipals #/AA"$ to IFRS. The
hardest part is it isgoing to be the actual 'ork o s'itching o&er the inancialinormation to
a completely dierent orm. This is 'here a lot o thetime and money rom companies are going to
go. The man0hoursthat it is going to take is a lot +ust in it sel. This goes rom smallcompanies to
large companies. That leads to the training andschooling to teach the 'orkers) managers and
anyone else that takesplace in completing inancial statements. These companies are goingto ha&e
to learn ho' to adapt to these ne' standards. This takes a loto time) both in training and then in
applying that training. Thatmeans that there is going to ha&e to be e*tra auditors and
analystsaround to check and make sure e&erything is being done correctly.

#Adopting$
This Adoption of !"# or Harmonization of Accounting #tandards does ha'e itscosts but what it will do to help the .nited
#tates companies and in'estors ma(esthis transition worth the wor() /ith the completion of the adoption of !"#, theglobal
mar(et, with the .nited #tates included, will ha'e one standard for allcompanies around the world) This uni'ersal standard
will help in'estors andcompanies compare the other companies0 financial statements and understand themso they can in'est or
gain other (nowledge for their own purpose) This alsoprotects the in'estor so they (now what they are loo(ing into and can
ma(e more'aluable decisions when doing business) This now goes to show how the mar(etaround the world is going
global) /hich this will help world resources be bettermanaged by e'eryone because they will able to follow the same rules
andregulations) $Harmonization% n'estors from the .nited #tates will now ha'einternational in'estment opportunities and can
benefit from comparing non1united#tates companies from .nited #tates companies with !"#) /hen this globalAccounting
#tandard de'elops and is in operation it will change the business1financial world, as we (now it) $#23%2014 is coming ,uic(ly
and seems that the .nited #tates has a lot to wor( on if !"# and the harmonization of the Accounting world is going to be in
affect bythen) f they follow the #23 road map to !"# personally thin( that we ha'e adecent shot at adopting the !"#
standards into .nited #tates business mar(et)This is going to ta(e a lot of organization and time from the
go'ernment,organizations and companies if they want this goal to succeed) Also, the educationon this topic is going to ha'e to
be introduced 'ery soon to e'eryone it effects andthe one0s it will effect in the future) There is too much tal(ing and
speculatingabout this big transition to !"# but not enough is actually being done to ma(e surethat it is going to wor()!"#
sounds li(e it is going to help the .nites #tates in many great ways for thefuture of business but it0s the Americans that am not
sure if they are willing orready to ta(e on such a tas( but hopefully the A#-, !A#- and the #23 willcontinue to wor( towards
coming up with a solution in eliminating the differences between .)#) 4AA5 and !"# and the Harmonization of the
Accounting world)
As the trend or g!oba!ization in business becomes increasing!% im&ortant or
economic success,man% issues arise through internationa! business &ractices or
cor&orations, go"ernments, andin"estors. Due to the man% con!icting codes and
&ractices that e+ist between "arious nationa!inancia! accounting standards
throughout the wor!d, internationa! business becomes harder to ana!%zeas
inormation is not easi!% com&arab!e between com&etiti"e industries. )Diaconu
-../* 0ecausethere is no standard internationa! code or inancia! re&orting around
the wor!d, man% mu!ti1nationa!cor&orations are orced to reconci!e their inancia!
inormation to conorm to mu!ti&!e inancia!re&orting standards. #his &rocess o
reconci!ing inancia! inormation or conormit% with dierentaccounting s%stems
can be e+&ensi"e, and a!so ma'e inormation mis!eading. As a resu!t o themassi"e
increase in internationa! business and the diicu!t% o re&orting accurate uni"ersa!
inancia!inormation, initiati"e has been ta'en to create a harmonization o
accounting standards betweennations. Harmonization o accounting standards
between nations is a "er% im&ortant current issuewhich has man% &ossib!e beneits
or conse2uences, as we!! as man% obstac!es to o"ercome orsuccess. #his &a&er wi!!
e+amine &otentia! ad"antages and disad"antages o a harmonizedinternationa!
accounting standard3 discuss "arious obstac!es associated with the creation
andim&!ementation o these standards, and &ro"ide &ossib!e so!utions to o"ercome
these obstac!es.#here are man% &otentia! ad"antages associated with
harmonization o accountingstandards. #he wor!d econom% cou!d beneit through
increasing!% educated in"estment decisionswhich wou!d !ead to o"era!! g!oba!
economic growth. Accounting inormation can be inter&reted b%e+&erts to reduce
the ris' o in"estment. 4ne o the main too!s used in inancia! ana!%sis is
thecom&arabi!it% o inancia! inormation or simi!ar businesses in
com&etition. Internationa!!% ado&tedaccounting standards wou!d increase this abi!it%
to com&are simi!ar industries and ma'e in"estmentdecisions !ess ris'% through
greater inte!!igence. A standardization o internationa! accountinginormation wou!d
aci!itate easier inter&retation or inancia! e+&erts a!! around the wor!d see'ing
toin"est internationa!!%. #his increased abi!it% to inter&ret inormation cou!d
&otentia!!% resu!t in ano"era!! increase in educated g!oba! in"estment. Another
&otentia! beneit rom the harmonization o internationa! accounting standards
wou!d be the reduced costs associated with mu!ti1nationa!cor&orations who must
reconci!e their accounting inormation or mu!ti&!e accounting standards.)Diaconu
-../* Countries with scarce resources cou!d a!so ta'e ad"antage o internationa!
accountingstandards, because the% wou!d not ha"e to in"est resources creating and
regu!ating nationa!accounting standard1setting agencies. In order to be !isted on
credib!e stoc' e+changes, businessesmust abide b% the inancia! re&orting
re2uirements o the stoc' e+change it wishes to se!! securitiesthrough. Stoc'
e+changes around the wor!d cou!d &roit rom a harmonization o
accountingstandards, as more com&anies begin to ado&t the internationa! standard,
the% wi!! become e!igib!e or!isting. As the amount o !istings grows on the stoc'
e+changes so wi!! the "o!ume o securitiestransactions. ),arion and Cengage -..5*.
Fili3ino accountants gear to+ar, Asean integration
http://www.manatmes.net/pno-accountants-gear-toward-asean-
ntegraton/106484/
June 24, 2014 9:40 pm
by Ritchie A. Horario
3!L!P!N# certified public accountants ?CPAs; are *earin* toward t$e impendin* inte*ration of t$e
P$ilippines into t$e Asean %conomic Community ?A%C; t$at is li)ely to ta)e place two years from
now(
=onnies Alas5 president of t$e Accreditation of Certified Public Accountants in Public Practice
?ACPAPP; on 0uesday said 3ilipino accountants s$ould prepare for t$e Asean inte*ration by
under*oin* Auality review in order to meet international standards(
B9it$ t$e impendin* Asean inte*ration5 t$e preparation of our 3ilipino certified public accountants is
muc$@needed at t$is point in time5C $e told 0$e Manila 0imes durin* t$e ACPAPP4s Dt$ *eneral
members$ip assembly in Ma)ati City(
e cited a past study by t$e Asian =evelopment &an) ?A=&;5 w$ic$ s$owed t$at t$e Auality of
practice amon* 3ilipino CPAs is Bbelow par(C
&ecause of t$is5 Alas said t$e A=& also commissioned a study on $ow to raise t$e standards of
practice of 3ilipino CPAs(
!n +77>5 *overnment re*ulator Securities and %2c$an*e Commission ?S%C; adopted t$e
!nternational 3inancial Reportin* Standards ?!3RSs;5 w$ic$ is bein* strictly implemented by E>
countries(
B0$e adoption of !3RSs s$ows t$at t$e Auality of our wor) and our presentation of financial reportin*
will be in accordance wit$ international standards5C Alas said(
e noted t$at 3ilipino CPAs s$ould stay stron* and competitive amid t$e many c$allen*es5 includin*
t$e imposition of various policies by *overnment re*ulators suc$ as t$e S%C and t$e &ureau of
!nternal Revenue(
B&ecause of t$ese c$an*es5 many are facin* problems5C $e said(
0o address t$is5 t$e ACPAPP $as been conductin* re*ular seminars and trainin* to $elp t$eir
members up*rade t$eir s)ills to meet international standards(
#ne of t$e )ey elements in t$e Asean inte*ration blueprint is t$e freer flow of s)illed labor t$rou*$
mutual reco*nition a*reements5 initially on seven professions5 namely medical5 dental5 nursin*5
accountancy5 en*ineerin* and arc$itectural services and surveyin*(
Alas e2pressed confidence t$at 3ilipino CPAs would benefit from t$e impendin* Asean inte*ration(
B9it$ t$e inte*ration5 CPAs can practice in ot$er Asean@member countries5 but t$ey s$ould meet
international standards( 0$at is w$y we are up*radin* our practice5C $e said(
3ilipino CPAs5 $e added5 $ave t$e benefit of *ood trainin* and communication s)ills(
B9e $ave a bi* advanta*e because we spea) %n*lis$5 we are a *ood communicator and t$e trainin*
is *ood ?as well;( After trainin*5 some of our CPAs wor) abroad5C $e said(
e also dismissed fears t$at wit$ t$e Asean inte*ration5 more CPAs will be encoura*ed to wor) in
ot$er countries5 resultin* in a brain drain for t$e P$ilippines(
B9e are producin* E5777 CPAs a year5 and t$ey need an employment $ere( So5 we will not be
e2periencin* possible s$orta*e of CPAs5C $e said(
A!"AN accounting institutes +or5
to+ar,s mutual recognition
http677www)charteredaccountants)com)au78ews1*edia7#tate1news79'erseas7A#2A81
accounting1institutes1wor(1towards1mutual1recognition)asp:
8o' 20 2012
7e. (oints
The Institute hosted a meeting of accounting bodies from across South-East Asia in
early November as they worked towards developing a mutual recognition agreement
across the accounting bodies
The Institute is an associate member of the ASEAN Federation of Accountants
Andrew Stringer the Institute!s "irector Asia will be a keynote speaker at an event
for the Australian #hapter of the Institute of #hartered Accountants in India$
0$e !nstitute5 as an associate member of t$e ASEAN Federation of Accountants5 $osted a meetin* of
accountin* bodies from across Sout$@%ast Asia in early November as t$ey wor)ed towards developin* a mutual
reco*nition a*reement across t$e accountin* bodies(
0$e AS%AN countries F made up of !ndonesia5 Malaysia5 P$ilippines5 Sin*apore5 0$ailand5 &runei5 Gietnam5 Laos5
Myanmar and Cambodia F are wor)in* towards re*ional economic inte*ration by +7'>5 and professions suc$ as t$e
accountin* profession are assistin* to ac$ieve t$is end by addressin* mutual reco*nition for professional accountants
across t$e ten countries(
9$ile Australia is not an AS%AN member country5 t$e !nstitute is one of four associate members of t$e AS%AN
3ederation of Accountants(
HA lot of wor) is *oin* between t$e AS%AN nations to ac$ieve a common mar)et( 0$e accountin* bodies across t$ese
nations are wor)in* $ard to assist in t$is endeavour by focusin* on professional accountants across t$e member
countries( 9e can see t$e si*nificant benefits of $avin* a stron* and deep accountin* profession across t$e re*ion
and are lendin* a $and to $elp reac$ t$at *oal54 says t$e !nstitute4s =irector Asia5 Andrew Strin*er(
Mr Strin*er is wor)in* wit$ accountin* bodies across Asia to build ties and relations$ips for t$e accountin* profession
across t$e re*ion5 en*a*in* in education and trainin*5 capacity buildin* and leaders$ip(
e will also be a )eynote spea)er at an event for t$e Australian C$apter of t$e !nstitute of C$artered Accountants in
!ndia5 bein* $eld in Sydney in November(
%ne economic region one accounting framework
http122'''.sg&.ph2one0economic0region0one0accounting0rame'ork0by0
+osephine0adrienne0a0abarca0ebruary010020142
&y 'osephine Adrienne A$ Abarca
Business World (02/10/2014 p.S1/6)
BUSINESS s at the forefront of gobazaton wth markets becomng more nterconnected, nvestors
ganng a more sophstcated wordvew, and foregn nvestments becomng more expansve. The
nature of competton s aso changng, wth companes ncreasngy dong cross-border oherngs.
Domestc companes now nd themseves competng wth both oca counterparts and nternatona
companes - underscorng the need for reabe and comparabe nanca nformaton. Ths necessty
becomes even more pressng wth the Assocaton of Southeast Asan Natons (ASEAN) Economc
Communty (AEC) on the horzon.
Adoptng a hgh-quaty and consstent set of accountng standards s vta for companes n the ASEAN
member states f they wsh to reman compettve. A ook at the accountng standards adopted by the
varous member states shows a snge theme: that these standards are based (for the most part) on
the Internatona Fnanca Reportng Standards (IFRS) as ssued by the Internatona Accountng
Standards Board (IASB). Some were based on the od Internatona Accountng Standards (IAS), the
forerunner of the current IFRS.
The IASB s actvey pushng for the goba adopton of the IFRS. Based on surveys conducted by the
IASB, more than 100 countres have ether aready adopted or commtted to adopt IFRS as the snge
set of goba accountng standards.
Wth the push towards goba IFRS adopton and the need to have a snge set of accountng standards
n the ASEAN, how are the ASEAN member states farng n terms of the adopton of and compance
wth the IFRS?
ASEAN A"%(TI%N %F IF)S
Brune announced that t woud fuy adopt IFRS as ssued by the IASB by |an. 1, 2014. Intay, fu IFRS
adopton w ony be requred for enttes wth pubc accountabty such as banks, nanca
nsttutons, nsurance companes and takafu companes (those that are smar to mutua nsurance
companes).
Cambodas accountng standards, the Cambodan Fnanca Reportng Standards (CIFRS), are agned
wth IFRS wth no modcatons. CIFRS s requred for sted enttes; however, mandatory adopton for
banks, nsurance companes and mcronance nsttutons has been deferred to |an. 1, 2016.
Indonesas Indonesan Fnanca Accountng Standards (IFAS) are based on the IFRS that were ehectve
|an. 1, 2009, wth some modcatons. Indonesas approach s to graduay converge the IFAS wth the
IFRS.
Laos pans to fuy adopt IFRS ths year. Ths w cover sted companes or companes that are n the
process of beng sted.
Maaysa has aready fuy converged ts Maaysan Fnanca Reportng Standards wth the IFRS. Wth
the excepton of Transtonng Enttes (TEs), a non-prvate enttes were mandated to adopt these
standards for annua perods begnnng on or after |an. 1, 2012. TEs are the enttes that are sub|ect to
the appcaton of MFRS 141, Agrcuture, and/or the Maaysan Interpretaton 15, Agreements for
Constructon of Rea Estate.
Myanmar uses the Myanmar Fnanca Reportng Standards (MFRS) and Myanmar Accountng Standards
(MAS), whch are dentca to the IFRS ssued as of end-2010. Myanmar pans to update these
standards to capture subsequent ssuances of the IASB.
Sngapore uses the Sngapore Fnanca Reportng Standards (SFRS). To date, Sngapore has adopted
most of the IFRS (as SFRS). Sngapore has yet to adopt the amendments to IFRS 10, Consodated
Fnanca Statements, and IFRS 12, Dscosure of Interests n Other Enttes, on nvestment enttes and
IFRS 9, Fnanca Instruments.
Thaands Tha Accountng Standards (TAS) are based on the 2009 verson of IFRS. TAS excudes
ndustry-specc IFRS such as IFRS 4, Insurance Contracts, and IAS 41, Agrcuture, and the standards
on nanca nstruments - IAS 32, Fnanca Instruments: Presentaton; IAS 39, Fnanca Instruments:
Recognton;IFRS 7, Fnanca Instruments: Dscosures; and IFRS 9. Thaand pans to compete
adopton of IFRS by 2016.
Vetnamese sted companes are requred to use the Vetnamese Accountng Standards, whch are
based on the IAS ssued up to 2003. However, IFRS s requred for state-owned banks and permtted for
commerca banks.
In the Phppnes, the convergence wth IFRS has been progressng we snce 1997, when the country
began to move towards IFRS. By 2005, we had fuy adopted IFRS, whch were renamed Phppne
Fnanca Reportng Standards (PFRS). New and amended IFRS ssued by the IASB thereafter were aso
adopted. The ony excepton to ths s the deferra of IFRIC 15, Agreement for Constructon of Rea
Estate. Except for sma- and medum-szed enttes and mcro-enttes (as dened by the Phppne
Securtes and Exchange Commsson), a companes are requred to compy wth PFRS.
A)E *E )EA"+ F%) T,E AE# -./01
Based on the above, t woud seem that some ASEAN member states are ready or amost ready for fu
IFRS adopton n tme for, or shorty after, the 2015 ASEAN ntegraton. On the other hand, t cannot be
dened that other member states st have a ong way to go n ths aspect. However, t s very
encouragng to see how we and our cose neghbors are workng to standardze accountng standards
across the regon.
Utmatey, mpementng IFRS fuy across the regon w ncrease transparency and credbty for
rms n the ASEAN. It w aso ncrease goba compettveness as nanca resuts become more
acceptabe and comparabe, resutng n more consstent nformaton made avaabe to capta
markets and decson makers.
We shoud aso consder how mportant adoptng IFRS w be to Phppne accountng professonas. By
ganng mastery of IFRS, practtoners can eevate themseves to regona-eve (and even goba-eve)
competence and can expand ther servces to other countres. We have aways beeved that the
Fpno accountant s of word-cass caber. Wth the upcomng ASEAN economc ntegraton, we w
soon have even more opportuntes to prove ths cam.
Sen. Grace Poe's Speech
https677www)senate)go')ph7press;release7201470<14;poe2)asp
At the PICPA Accountnc! Wee"
#ul! 14$ 2014
Before anythng ese, et me rst acknowedge the foowng guests and omcers of PICPA:
It s truy a great honor to be gven ths opportunty to speak before you today. I have aways
been n awe of accountants and, n a honesty, I admre the |ob you do. To me, accountng s
a |ob that seems very tedous, qute compcated and rather borng. Ths s probaby because
mahna ako sa math (|oke).
SPEECH PROPER
I woud ke to begn my speech by takng a tte about one of my foremost advocaces at
the moment. And that s the Freedom of Informaton (FOI) b.
Much of my rst year n the Senate was spent workng for the passage of a (strong) Freedom
of Informaton b. As you may we know, pumasa na po ang FOI b sa Senado noong
Marso. Sa ngayon, ang FOI b ay dndng sa Kamara de Representante, sa am ng kumte
n Congressman |orge Amonte (ng Msams Occcenta).
Maramng nagsasab, "Grace, huwag mo nang pagaban yang FOI, hnd naman yan ma-
apprecate ng masa." But what s reay the sgncance of the FOI? Ths act w empower
the peope to gather nformaton from the government. Thus, ths w compe state
nsttutons to grant the pubc access to nformaton about what ther government s dong
and not dong for them. Once the FOI s passed nto aw, any ctzen can request and
scrutnze pubc documents that were before not accessbe to hm. Of course there w be
exemptons, those documents that are protected for natona securty. Wth ths ncreased
eve of pubc scrutny and transparency, FOI w reduce corrupton and brng about better
government n the Phppnes. If we had the FOI, I don't thnk we woud have reached ths
pont of controversy n our PDAF because at the very start, every senator's omce shoud be
abe to upoad n ther webste and made avaabe for scrutny a the pro|ects that they
have. So even the meda w be abe to approach the omce or check the webste and see for
themseves f those pro|ects are egtmate or not.
I thought of mentonng the FOI here because you accountants (especay those among you
workng n government) w pay an nvauabe roe n the success of FOI. Ths s because, as
accountants, you are (usuay) the custodans of the nanca records of your respectve
organzatons. You know how much was spent for what pro|ect and for whom. You hep
prepare the nanca statements, qudaton reports and the panta of your organzaton.
These are the types of nformaton that our peope woud be nterested to know once we
have FOI. Therefore, as accountants and nanca omcers, you must make sure that a
(nanca) nformaton that you post onne or reease to the pubc must be true and
accurate. Fnanca statements, budgetary dsbursements, corporate dscosures and other
smar documents (that you usuay prepare) must reect the truth and must never msead
the pubc. Ths s your professona as we as mora obgaton as censed certed pubc
accountants (CPAs), as contaned n your Generay Accepted Accountng Prncpes (GAAP).
You must never aow yourseves to be used as toos by corrupt government omcas to cover
up a mafeasance or to deceve the pubc, hnd nagssnungang ang numero. As
accountants, you must aways ght for what s true.
Ths s why I am very happy and excted to hear that your group s organzng an "Operaton
Eecton Count" to hep ensure cean and honest eectons ths comng 2016 and beyond. I
thnk ths s an exceent dea- sno pa ba ang mas gagang mag-tay ng boto kung hnd
kayong mga accountants? Pease know that you have my fu support on ths ntatve, and I
w encourage COMELEC and urge a of you to throw your fu support to ths worthwhe
endeavor, so that n 2016 our country w have eecton resuts that s truy reectve of the
true choce and voce of the peope.
One of the bs that I woud ke to concentrate my ehorts on to pass s the Standard Lunch
Program for pubc eementary and hgh schoos. I woud ke to ptch ths now because rst
of a, 34% of our popuaton are chdren beow 17 years od. Nakta nnyo kung gaano
kababata ang sa workforce natn ngayon, kayo sa opsna nnyo dba napakaram rng mga
bata na mga nag-aaapy? It s the young ones, our rch resource n our youth--beng abe to
suppy the needs of our empoyment requrements that s our prme advanatge. But then to
be abe to preserve ths advantage, we have to make sure that our kds n the pubc schoos
are we-fed. Lades and gentemen, hnd naman tatano yang mga yan kung gutom sa. So
that's what I'm sayng, dapat may Standard Lunch Program sapagkat ano ba naman ang
pagkagastusan ng gobyerno ang pagkang mapupunta dretso sa tyan ng atng mga anak.
Kung P63 bon ang condtona cash transfer program a year, ang free unch program para
sa mga bata ay P11 bon, hnd pa mabubusa ang pera. Kaya nga kaangang pag-araang
mabut para yung ogstcs ay magawa. So I'm ghtng for a verson of ths. I hope t w pass
but of course we w need the hep of accountants to make sure that the bddng process
and everythng ese, how t w be managed, s reay vabe. Lades and gentemen, Chna s
a very powerfu country today. But n a Tme magazne ssue, t sad that n the year 2050,
one n three peope n Chna w be over the age of 60 years od, even ther popuaton s
growng od. The same s true for |apan. But the Phppnes, by 2050, we w be at the peak
of our workforce, wth a ot of young members of socety gettng nto the workforce. So we
have to be abe to nvest n ths partcuar advantage of ours. At the very begnnng, as a
mother, I thnk a of you w apprecate ths. A chd that s propery fed, propery cothed,
propery cared for w be a chd that w have better chances of succeedng.
Let me now go to the topc at hand.
Ths year's conventon theme s "LEAP and BEAT the Odds" as PICPA gears toward meetng
the chaenges and opportuntes presented by ASEAN Economc Integraton n 2015.
I thnk the queston n everyone's mnds rght now s: ano ba tong ASEAN Economc
Integraton? And how w t ahect me as a professona accountant once t takes ehect next
year?
We, aow me to share what I take ASEAN Integraton w mean for you n the smpest
terms.
Noon, kung bagong CPA passer ka, ang karanwang "career path" mo ay maghanap ng
trabaho sa Makat (e.g. appy ka sa SGV) and then, after ganng some experence and
contacts, set up ka ng sar mong accountancy rm or maghanap ka ng trabaho sa U.S.,
Canada o sa Mdde East.
Wth ASEAN Economc Integraton, our Fpno professonas w have greater empoyment
opportuntes and broader career optons. Once the Phppnes s fuy ntegrated nto the
ASEAN economy, a newy-censed CPA w now have broader opportuntes for empoyment.
Kung noon, pagkakuha mo ng sensya mo sa Makat ka ang naghahanap ng trabaho, sa
ASEAN Integraton puwede ka na tumngn kung may openng sa Maaysa, Sngapore o
Indonesa. Or kung hambawa hnd ka na happy sa present work mo (e.g. dah mabaga
ang promoton o mted ang career advancement prospects mo), you can expore and
transfer to another company n another ASEAN country wthout suherng any dmnuton n
your rank or pay.
Pero bago po to mangyar, may mga hakbang tayong kaangang gawn para
masakatuparan to. Before ths coud happen, both the Phppne government and the
professons need to put n pace pocy reforms. Frst and foremost, we need to formuate
cear gudenes and procedures for the "recprocty of professons" wthn the ASEAN regon.
DOLE and PRC, I beeve, are currenty n the process of nazng pocy measures for the
mpementaton of the "Mutua Recognton Agreements" (MRA) wth our ASEAN neghbors.
The accountancy professon s perhaps more fortunate (than other professons) because the
MRA process for your sector started qute eary (commencng as eary as February 2009),
wth PICPA and PRC takng the ead n negotatng recprocty agreements wth ther ASEAN
counterparts. So chances are, Fpno accountants w be among the rst Fpno
professonas to en|oy ths "recprocty of professons" under the new ASEAN Economc Order.
But |ust on the ssue of changng the schoo caendar and ad|ustng the currcuum to meet
the ASEAN's standards, these two were very contentous. Dba maramng probema about
the K-12, but as we have seen, f the proposed change s expaned propery and sumcenty
to our peope, ther nta re|ecton w gve way to cooperaton, because the goa of the K-12
s that when you graduate from the K-12 system, you w be abe to work n certan eds or
n certan professons wthout havng to contnue to coege or obtan a coege degree. Not
because we are dscouragng those to seek coege degrees but they shoud be abe to have
ve sks as soon as they graduate from K-12, that's why as charperson of Pubc Order n
Dangerous Drugs Commttee, one of my bs s to be abe to make sure that those that w
graduate from the K-12 w be egbe for admsson n the Phppne Natona Poce.
But more mportant than pocy reforms, there must be a change n your mndsets. Even
now, I can sense that some of you are adamant or scared of ASEAN ntegraton. Huwag po
kayong matakot. Instead, you must wecome and embrace change. Kas, ka nga n |ose Mar
Chan, "fe s a constant change." Actuay, dapat mas matakot sa sa nyo, because the
Fpno accountant s reputed to be one of the word's best. Ths s because, asde from the
fact that we are the best Engsh-speakers n the ASEAN regon, our professonas are known
to be the most hard-workng, dedcated, easy-to-get-aong-wth, creatve and competent
professonas n Asa. I magne that there s an accountant n Sngapore (Maaysa, Thaand
or Brune) who fees threatened, frghtened that he/she w be "boxed out" by an accountant
from the Phppnes.
To be sure, fu economc ntegraton w not happen overnght. It w take many years,
decades even, and there w be setbacks for sure. I expect that the process of economc
ntegraton w be a tough and ong process, fraught wth much controversy and strong
resstance. For exampe, to acheve fu economc ntegraton, the Phppnes must
synchronze ts educatona system, ega framework and other nsttutona mechansms
wth the rest of ASEAN. But |ust on the ssue of changng the schoo caendar and ad|ustng
the currcuum to meet ASEAN standards - these were two very contentous ssues and most
of our schoos were aganst t ntay. But as we have seen, f the proposed "change" s
expaned propery/sumcenty to our peope, ther nta re|ecton w gve way to
cooperaton. Ths s why professona organzatons, such as PICPA, must step up on ts
ehorts to expan the mpcatons of ASEAN 2015 to a ts members, and make the transton
process as ess "panfu" as possbe.
For my part, I woud be more than wng to sponsor a b n the Senate to amend the
Accountancy Charter to make t more attuned to modern tmes. The Accountancy Law
(Repubc Act 9298) was ast amended 10 years ago, and t may requre further renements,
n ght of current deveopments ke the mpendng ASEAN Integraton n 2015. The door of
my omce s aways open to PICPA shoud you have any concerns or measures you want
passed to make the accountancy professon more compettve vs--vs our neghbors n the
ASEAN.
In cosng, I woud ke to say that we have no choce but to ntegrate wth the rest of ASEAN.
Huwag po tayong matakot. Instead, et us prepare ourseves to meet the chaenges ahead
and grab the opportuntes presented by the new ASEAN Economc Order.
Maramng saamat at magandng umaga po sa nyong ahat.
008 $ro+t* in Accounting (rofession in One #eca,e
http://www.acpa.org/Press/Pages/Growth-n-Accountng-Professon.aspx
Published February 20, 2012
By AICPA
Recent A!CPA researc$ s$owed t$at more college stu,ents gra,uate, +it* accounting ,egrees in t*e 0119:
0111 sc*ool .ear t*an an. 3re4ious .ear on recor,( And accordin* to t$e &ureau of Labor Statistics5 estimates
s$ow t$at t$e accountin* profession will *row by 008 bet+een 0118 an, 0118(
Recor,:!etting #eman, (ro;ecte, for Accounting
$ra,uates) AI%(A Re3ort
Accountin* Graduates and %nrollments at istoric Levels5 Continuin* 6pward 0rend
Published June 18, 2013
James !c*ia4one
Ne+ <or5 =June 19> 011?@ F !f you4re *raduatin* colle*e and want a <ob5 accountin* is t$e ma<or to $ave5 accordin*
to t$e +7', 0rends in t$e Supply of Accountin* Graduates and t$e =emand for Public Accountin* Recruits report
released today by t$e American !nstitute of CPAs( As t$e unemployment rate in t$e 6nited States is slow to rebound
to post@recession levels5 accountin* *raduates are en<oyin* an unprecedented level of demand from public
accountin* firms5 wit$ a record /75,>7 accountin* *raduates $ired in +7'+ and E- percent of t$ose firms forecastin*
t$e same or increased $irin* of *raduates t$is year(
And for t$e companies and firms w$o need newly minted accountants5 t$e report found record numbers of accountin*
*raduates5 as well as t$e $i*$est number of enrollments in under*raduate and *raduate accountin* pro*rams on
record5 indicatin* a t$rivin* pipeline of accountin* talent(
BA stron* supply of accountin* *raduates is essential to serve t$e comple2 demands of a rapidly c$an*in* business
environment and meet t$e needs of CPA firms of all si1es for top Auality talent( !t4s well )nown t$at t$e 6(S( capital
mar)ets also rely on t$e wor) of CPAs to ensure t$at investors $ave access to reliable and transparent financial
statements5C said Jeannie Patton5 A!CPA vice president5 academics5 professional pat$ways and inclusion( B0$e
$istoric *rowt$ in enrollments and de*rees is a testament to t$e attractiveness of t$e accountin* profession and t$e
career opportunities it provides for students(C
#verall5 t$e 0rends report s$owed a '-(. percent increase in accountin* *raduates over t$e previous survey5 wit$
E+5'.. accountin* de*rees awarded in t$e +7''@+7'+ sc$ool year( &ot$ under*raduate and *raduate de*rees are at
t$eir $i*$est level in t$e /7 years t$e A!CPA $as been conductin* t$e survey( !n addition5 t$e +/75,E7 accountin*
enrollments for t$e +7''@+7'+ sc$ool year in bot$ &ac$elor4s and Master4s de*ree pro*rams represent an all@time
$i*$ and demonstrate a continued stron* interest in t$e accountin* profession as a career c$oice(
0$e results of t$e 0rends report are consistent wit$ t$e findin*s of t$e &ureau of Labor Statistics +7'+@+7',
#ccupational #utloo) andboo) 5 w$ic$ found t$at employment of accountants and auditors is e2pected to *row 'D
percent from +7'7 to +7+75 representin* an additional '-75.77 <obs( 0$e &LS andboo) notes t$at candidates wit$
professional reco*nition5 suc$ as a CPA5 as well as t$ose wit$ MasterIs de*ree in accountin* $ave an advanta*e in
t$e <ob mar)et( 0$e 0rends report found t$at t$e number of accountin* students *raduatin* wit$ Master4s de*rees
$as more t$an doubled in t$e last ten years5 and t$at /' percent of accountin* *raduates $ired by public accountin*
firms in +7'+ $ad *raduate de*rees5 ec$oin* t$e &LS findin*s(
B%mployers are increasin*ly loo)in* to $ire CPAs wit$ advanced de*rees5 as t$ey $ave t$e education and s)ills
necessary to wor) in an increasin*ly comple25 *lobal business environment5C said Patton( B0$e best way to ensure
t$at t$e profession $as t$e necessary talent to fill t$ese positions is to recruit t$e best and bri*$test youn* minds from
t$e entire talent base available and ma)e certain we wor) to retain t$em(C
0$e percenta*e of enrollments by et$nicity in t$e +7''@+7'+ academic year saw increases across t$e board
compared to +77-@+7'75 t$e last time A!CPA conducted t$e survey( Minority enrollment reac$ed ,, percent at t$e &A
level5 up from +,(/ percent( Minorities comprised ,E percent of enrollments in Master4s pro*rams5 an increase from
+'(D5 and minority enrollment in P$(=( pro*rams totaled ,/(/ percent5 *reater t$an t$e +.(E percent in t$e previous
report( !n addition5 t$e +7', 0rends report found t$at minorities comprised +> percent of employees at public
accountin* firms5 up from +' percent durin* t$e previous survey( Minority representation at t$e partner level
increased to '7 percent5 up from t$e D percent reported in t$e last survey(
B9$ile *ains in t$e percenta*e of minority enrollments5 *raduates5 employees and partners since t$e last survey are
encoura*in*5 t$e National Commission on =iversity and !nclusion will continue to wor) to find solutions to t$e
declinin* tra<ectory of minorities in t$e accountin* profession by focusin* on retention and advancement5C said Jim
=rum*o5 director of diversity and inclusion at t$e A!CPA(
0$e A!CPA $as two pro*rams5 Start ere5 Go Places( and 0$is 9ay to CPA 5 to educate students on t$e possibilities
of a career in accountin* and provide t$em wit$ resources and *uidance as t$ey enter t$e profession( !n addition5 t$e
A!CPA offers many sc$olars$ip opportunities for accountin* students t$rou*$out t$eir academic careers(
1982 to 1986 - Door to the World
http677www)ey)com75H7en7About1us79ur1people1and1culture79ur1history7#4=1113o1history
Arthur Andersen & Co., S.C.
!n '-E+5 Ri1alino S( Navarro too) over as C$airman and Mana*in* Partner of SGG( =urin* $is '7@year
term5 $e oversaw and *uided t$e 3irm t$rou*$ many c$an*es5 t$e most important of w$ic$ was *ainin* a
*lobal partner(
In 1985, after four decades of regional expansion, the SGV Group member frms in Indonesia,
Philippines, Taiwan, and Thailand became members of the Arthur Andersen & Co., Socit
Cooprative, also known as the Andersen Worldwide Organization (AW). AW was already the worlds
largest professional service organization at that time, with operations in roughly 50 countries and a
workforce of about 30,000.
K0$e association wit$ A9 was a bi* strate*ic step5K Navarro said( K9e c$ose A9 because it was t$e best
in !0 and we )new t$at !0 would be a critical competitive factor in our profession(K
The relationship between the two organizations was mutually benefcial. The SGV Group served as
AWs link to East Asia while AW aforded SGV access to its highly advanced computer technology
and training programs and to its international network.
In 1986, the Manila Advanced System Center and the Microcomputer Resource Facility were made
operational through rapid technology transfer from AASC. Aided by computerization, SGV provided
services to over 8,000 clients.
All levels of the organization benefted from intensive training. Formal training and international on-
the-job experiences dramatically increased skills and enabled the Firm to deliver outstanding quality
service in the feld of technology.
1987 to 1991 - The Age of Globalization
A global frm
Heading into the '90s, SGV continued to expand its reach and services. The Firms scope of practice
grew to include the whole range of audit, tax and consulting services using advanced technologies,
methodologies and approaches for all industry groups within a worldwide network of ofces, experts
and resources while serving clients on a global scale from a solid Asian base. With technology from
AASC, the Manila Advanced Systems Center has been developing software for the major frms in the
US and Japan through satellite communications since 1988. SGV has also contributed to the AASC
structu re by providing in-depth understanding of the frms.
SGV Consulting embarked on a major engagement in Ghana > one of thousands of International
Development Projects SGV has undertaken since the early 70s throughout Asia and in other regions
of the world. SGV also ofered its services for investment in Vietnam once again.
Because of SGVs indomitable leadership, its track record has remained unmatched in the region. It
has accumulated various resources in its four-and-a-half decade of operations >competent staf,
state-of-the-art facilities and an international network. The vision of SGV is not only to give value
service to its clients but, more importantly, to become a partner in development of the country where
it operates. The Arthur Andersen Worldwide Organization shares this vision.
/ro'th in -ast Asia
3hat 3e !an and 3hat 3e !annot Iner
http://www.mf.org/externa/pubs/ft/ssues1/
*ichael #arel
?1@@< nternational *onetary !und
#eptember 1@@A
"reace
The 2conomic ssues series was inaugurated in #eptember 1@@A) ts aim is to ma(e
accessible to a broad readership of nonspecialists some of the economic research
being produced in the nternational *onetary !und on topical issues) The raw material
of the series is drawn mainly from *! /or(ing 5apers, technical papers produced by
!und staff members and 'isiting scholars, as well as from policy1related research
papers) This material is refined for the general readership by editing and partial
redrafting)
The following paper draws on material originally contained in *! /or(ing 5aper
@B7@C, D4rowth in 2ast Asia6 /hat /e 3an and /hat /e 3annot nfer !rom t,D by
*ichael #arel, an 2conomist in the !und0s #outheast Asia and 5acific Eepartment) t
has been prepared by Ea'id E) Eriscoll of the !und0s 2:ternal "elations Eepartment)
"eaders interested in the original /or(ing 5aper may purchase a copy from *!
5ublication #er'ices)
/ro'th in -ast Asia
3hat 3e !an and 3hat 3e !annot Iner
The spectacular growth of many economies in 2ast Asia o'er the past +0 years has
amazed the economics profession and has e'o(ed a torrent of boo(s and articles
attempting to e:plain the phenomenon) Articles on why the most successful
economies of the region Hong Fong, Forea, #ingapore, and Taiwan 5ro'ince of
3hina ha'e grown, to say the least, robustly in'ariably refer to the phenomenon as
Dmiraculous)D /hen practitioners of the Eismal #cience ha'e recourse to a Higher
5ower, the reader (nows that he is in trouble) 3onfusion is compounded when he
disco'ers that ideological debate has multiplied e'en further the analyses of this
phenomenon) "ather than swelling the torrent of interpretations, this paper sets for
itself the modest agenda of re'iewing the weightiest arguments in the literature that
attempt to identify the reasons for the e:traordinary economic growth in 2ast Asia and
trying to decide which arguments ma(e sense) The e:ercise has 'alue because finding
the right e:planation might suggest how to replicate this success elsewhere and, as a
bonus, might also satisfy the reader0s urge to sol'e an engaging intellectual puzzle) t
is best if we start with the facts)
#ince 1@A0 Asia, the largest and most populous of the continents, has become richer
faster than any other region of the world) 9f course, this growth has not occurred at
the same pace all o'er the continent) The western part of Asia grew during this period
at about the same rate as the rest of the world, but, as a whole, the eastern half $ten
countries6 3hina, Hong Fong, ndonesia, Gapan, Forea, *alaysia, the 5hilippines,
#ingapore, Taiwan 5ro'ince of 3hina, and Thailand% turned in a superior performance,
although 'ariations in achie'ement can be obser'ed here too) The worst performer
was the 5hilippines, which grew at about 2 percent a year $in per capita terms%, about
e,ual to the a'erage of non1Asian countries) 3hina, ndonesia, Gapan, *alaysia, and
Thailand did better, achie'ing growth rates of +1B percent) This impressi'e
achie'ement is, howe'er, still modest compared with the phenomenal growth of Hong
Fong, Forea, #ingapore, and Taiwan 5ro'ince of 3hina, (nown as the D!our TigersD
because of their powerful and intimidating economic performance) The Tigers ha'e
had annual growth rates of output per person well in e:cess of A percent) These
growth rates, sustained o'er a +01year period, are simply amazing) /hile the a'erage
resident of a non1Asian country in 1@@0 was <2 percent richer than his parents were in
1@A0, the corresponding figure for the a'erage Forean is no less than A+C percent)
This paper begins by loo(ing at the long1running debate o'er the nature of growth) s
growth the result for the most part of an accumulation of manpower and machinery, or
is it the result of employing the latest technology? The paper then loo(s at the growth
record of the four countries from three other angles6 the influence of go'ernment
inter'ention, the e:tent to which in'estments and e:ports can be considered the main
engines of growth, and the significance for sustained growth of the economic
conditions pre'ailing at the 'ery beginning of the countries0 period of e:tended
growth) The paper concludes with a few minimalist obser'ations on possible areas for
future study)
The 4ature o /ro'th1
Factor Accumulation or Technological "rogress
2'eryone agrees that the economies of 2ast Asia, and particularly the !our Tigers,
ha'e grown spectacularly o'er the past generation, but nobody seems to agree on why)
The debate o'er why they ha'e grown so well in the past raises difficult ,uestions
about regional growth in the future and about the aspiration of countries elsewhere to
replicate the 2ast Asian success) The arguments at the center of the debate are based
on theoretical notions of growth accounting)
This accounting method deals with three elements that contribute to the production of
goods and ser'ices6 labor, capital, and technology) Habor and capital, (nown
collecti'ely as the Dfactors of production,D refer in this conte:t to the wor(force and to
the capital goods $buildings, machines, 'ehicles% that the wor(force uses in
manufacturing some product or pro'iding some ser'ice) Technology refers to all the
methods employed by labor and capital to produce a good and depends on the
de'elopment or ac,uisition of practical s(ills to get the &ob done more ,uic(ly and
more efficiently) 8o one denies that all three elements must be present to some degree
if an economy is to grow) /hat is sub&ect to debate is the contribution of the factors of
production relati'e to that of technology) #ome belie'e that increased use of labor and
capital e:plain all growthI others are persuaded that the answer to growth lies in the
use of more efficient technology)
/ithin the growth accounting framewor( it is possible to describe mathematically,
using a simple e,uation, the contributions of these three elements to the o'erall
production of an economy) -y di'iding the e,uation by the number of people in the
wor(force, one can deri'e a dynamic e,uation that shows how output per person
increases o'er time) #uch an e,uation mathematically describes the contribution to
higher output of the growth rate of labor participation, of capital employed per person,
and of technology $the latter also (nown as the growth of Dtotal factor producti'ityD%)
f applied empirically to specific economies this e,uation can gi'e a good idea of
what proportion of increased output is a result of higher labor participation and better
use of capital and what proportion is the result of technological progress)
The traditional formulation of this e,uation suggests that a significant and sustained
rate of technological progress is the only possible way, o'er the long run, for an
economy to achie'e a sustained rate of growth in output per person) /hy? The labor
participation rate can be increased for a while and will increase production, but
ob'iously it cannot increase indefinitely $e'erybody will ultimately be employed%)
And more growth in capital than in labor ultimately leads to diminishing returns to
capital, resulting in a fall in the growth of output e'en if capital continues to grow at a
constant rate) Therefore, in order to achie'e permanent growth, an economy must
continuously impro'e its technology) This (ind of growth is called Dintensi'e growth)D
n contrast to intensi'e growth, increasing output by increasing inputs of labor and
capital $e:tensi'e growth% can wor( only for a limited period, but it cannot last too
long)
n a famous study, #olow $1@BA% conducted a growth accounting e:ercise such as the
one described abo'e) He found that accumulation of capital and an increase in the
labor participation rate had a relati'ely minor effect, while technological progress
accounted for most of the growth in output per person) !urther studies ha'e
reconfirmed the 'alidity of these conclusions) Accordingly, the standard 'iew about
the success of the 2ast Asian countries emphasizes the role of technology in their high
growth rates and focuses on the fast technological catch1up in these economies) n this
'iew, these economies ha'e succeeded because they learned to use technology faster
and more efficiently than their competitors did)
A !ontrarian 5ie'
The collapse of the #o'iet .nion in about 1@@0, after years of apparent economic
success, caught most people by surprise) This collapse seemed to lend credence to the
De:tensi'e growth hypothesis,D which argues that the #o'iet .nion, after many
decades of e:tensi'e growth, ran into the ine'itable diminishing returns effect, &ust as
predicted in the growth accounting framewor(, because it had relied for its economic
growth on a massi'e accumulation of capital and labor and had been slow to accept
inno'ati'e technology) These de'elopments in the economy of the #o'iet .nion
ser'ed to raise concerns about other economies, including some 2ast Asian countries,
that ha'e in'ested primarily in labor and capital rather than in technology o'er the
past few decades) Frugman $1@@4% ma(es the comparison specific6
The newly industrializing countries of Asia, li(e the #o'iet .nion of the 1@B0s, ha'e achie'ed rapid growth in large
part through an astonishing mobilization of resources) 9nce one accounts for the role of rapidly growing inputs in
these countries0 growth, one finds little left to e:plain) Asian growth, li(e that of the #o'iet .nion in its high1growth
era, seems to be dri'en by e:traordinary growth in inputs li(e labor and capital rather than by gains in efficiency)
Hi(ewise, in e:plaining the e:traordinary postwar growth of the !our Tigers, Joung
$1@@4b% concludes that
one arri'es at total factor producti'ity growth rates, both for the nonagricultural economy and for manufacturing in
particular, which are well within the bounds of those e:perienced by the 923E and Hatin American economies o'er
e,ually long periods of time) /hile the growth of output and manufacturing e:ports in the newly industrializing
countries of 2ast Asia is 'irtually unprecedented, the growth of total factor producti'ity in these countries is not)
n the same 'ein, Fim and Hau $1@@4%, comparing the sources of economic growth in
these countries with those of 4ermany, !rance, Gapan, the .nited Fingdom, and the
.nited #tates, found that
by far the most important source of economic growth in these countries Kthe !our TigersL is capital accumulation,
accounting for between 4C and <2 percent of their economic growth, in contrast to the case of the 4roup of !i'e
industrialized countries, in which technical progress has played the most important role, accounting for between 4A
and <1 percent of their economic growth)
The results of these studies are not only stri(ingly different from the 'iew presented
earlier of the primacy of technological progress, but they also con'ey a 'ery
pessimistic message) !irst, economic growth in the !our Tigers is hardly miraculous6
it is &ust the e:pected outcome of a massi'e accumulation of labor and capital)
#econd, the progress of these economies along this growth path for the past +0 years
cannot continue) #ooner or later they will e:perience a dramatic decrease in growth)
Third, the societies in these countries made enormous sacrifices of consumption and
leisure to achie'e these growth rates) Therefore, e'en if their so1called success can be
replicated in other countries, it is probably not wise to do so)
-ut how conclusi'e are these results? n fact, conclusions based on these studies are
not 'ery robust in that they are sensiti'e to the specific assumptions of each study)
The main reason for this sensiti'ity is the difficulty of estimating the rate of growth of
capital stoc( in the 2ast Asian countries during the period under study) 2specially in
the case of the !our Tigers, for which there are no good data before 1@A0, it is
e:tremely difficult to estimate the capital stoc( at that time) To estimate how much
capital was a'ailable in 1@A0, dubious assumptions ha'e to be made about the
depreciation rate of capital stoc( and about how much in'estment flowed in during
the years of e:plosi'e growth beginning in 1@A0) /hat, for e:ample, are the
depreciation rates of different types of capital $buildings, industrial machinery,
computers%? Are they e,ual for all countries and for all industries, or are they higher
in faster1growing economies? /hat method is being used to estimate in'estment
flows in the past?
Additional interpretational problems come from trying to estimate the share of
national income attributable to capital and the share attributable to labor) Eoes the
same amount of capital produce e,ual income in all countries and in all industries?
3an statistics about the labor participation rate be trusted? s the amount of effecti'e
wor( proportional to the hours that people wor(, or does wor(ing e:tra hours lead to
diminishing returns? #hould different types of labor $factory, office% be summed
together? How should human capital be treated?
-ecause of these unanswered and perhaps unanswerable ,uestions, the results of
studies that emphasize the contribution to growth of capital and labor and depreciate
that of technology should not be regarded as definiti'e) They should be 'iewed as
interesting, but only suggesti'e)
Some !ounter0!ontrarian -&idence
.sing con'entional parameters and a con'entional method of e:trapolation, we ha'e
conducted a growth accounting e:ercise for the !our Tigers during 1@A01@0 along the
lines suggested by Joung $1@@4a%) The capital stoc( in these economies is assumed to
be 0 in 1@00 and subse,uently to increase by in'estment flows less depreciation) The
intention of this e:ercise is to demonstrate the general fragility of conclusions about
the nature of the growth process in 2ast Asia)
!igures 114 describe the results of this growth accounting e:ercise) !igure 1 compares
the growth rates of output per person of the !our Tigers with those of the rest of the
world during 1@A01<B and 1@<B1@0) The first four bars in this figure describe the
growth rates of the indi'idual Tigers) The fifth bar describes the simple a'erage
growth rate of 100 countries, representing the rest of the world $row%) The si:th bar
represents the mean of the growth rate of the rest of the world plus a 1)@A standard
de'iation $row M 1)@Asd%) 4rowth rates can be regarded as DhighD if they are abo'e the
row but below row M 1)@Asd, D'ery highD if they are around row M 1)@Asd, and
DoutstandingD if they e:ceed this 'alue) !igure 1 shows that in this comparison the
growth rates of output per person of Hong Fong, Forea, and Taiwan 5ro'ince of
3hina were 'ery high in the 1@A01<B period and outstanding in 1@<B1@0, while the
growth rate of #ingapore was outstanding during the first period and 'ery high during
the second)
Top Eight 234 #hallenges Faced by
Accountants in (ublic (ratice
http://phcpa.org/2014/01/top-eght-8-chaenges-faced-by-accountants-n-pubc-
pratce/
9 months ago by Orando Caundan 0
When you have the experence, knowedge and the rght eve of condence to dea wth cents, pubc
practce s undoubtedy rght for you. In the ever demandng word of busness, accountants pay vta
roes and ths opens an opportunty to make busness.
We are aware of the fact that our professon s reguated and, therefore, we need to meet certan
quacatons before we can do pubc practce but that snt the bggest chaenge we face. Yes, we are
ke chosen from poo of professonas from the tme we graduated to eventuay passng the CPA exam,
ganng some meanngfu experences (as our code descrbes) and eventuay havng the guts to
practce. Makng t to pubc practce s way farther, but great chaenges are aways there to bug us.
3th 5 6rowing your clientele
Ths s for those startng up. Dependng on few cents wth hgh fees coudnt ast. What f you ost
them? You have to compete wth the current payers and you need to show how exceent you are n
provdng cent servce. It snt that easy.
7th 5 Increasing fees
You have a cent for ve (5) years now but your fee never ncreased snce day one. Reguators are
very demandng and requre new types of reports to be ssued asde from the norma assurance report
but your cent aows you to b wth an ncrease ony equa to the naton rate.
8th 5 )ecruiting competent sta9s
Accordng to statstcs, mons of Fpno are |obess. They dont have the experence yet, they
demand a managera-eve saary you barey can ahord. Are these nexperenced guys competent
enough to demand? Ouaty s one of the most sought-after aspect of our work and we need to baance
the cost and quaty of the stahs we are recrutng. Even f they cam they have the experence we
need, we st have to tran them to t our standards.
0th 5 #omple: Accounting and reporting re;uirements
Reguators have been very strct nowadays. They have been very actve n ndng ways to coect
more taxes and to protect pubc nterests. SEC have been ssung dramatcay hgh number of etter
of comments to nanca statements as BIR ssues tax assessments eft and rght. The before used to
be nanca statements and ncome tax returns for ng shoud now be accompaned by
suppementary schedues and reports.
Even Accountng standards have been contnuousy updatng to the pont that, what youve known
before are no onger appcabe. Standards are amended eft and rght and some are even revsed that
tend to dsorent us.
<th 5 "i=cult-to-deal-with client o=cers and personnel
Cents, sometmes, assume that they know more than you do. They thnk that the "Accountng 101
sub|ect ncuded n ther busness course gve them thorough understandng of a
the Accountng matters and decdes even before you recommend. They speak of "theres no busness
sense on that" wthout thnkng "what aboutAccountng sense?". As they assume to know everythng,
they woud make t dmcut for you to negotate hgher fee.
There are aso cent who ooks at audtors as poce, ready to make a panfu arrest when anythng
frauduent s dscovered. Theyre defensve, but not necessary guty. And as a return, theyd make t
hard for you to compete your work, deay everythng you need, unt you w be the one pendng.
>rd 5 Tight made tighter deadlines
Deadnes are agreed, great! Yes, you can do t f a panned actvtes w be done as schedues. Then
they fa to provde you the schedues on tme. What about that, reguatory deadnes cant be ad|usted
(except for fortutous event). Now you shoud be the one to ad|ust. Work overtme and even over nght
but t s |ust not enough. Cohee?
-nd 5 ?eeping self updated with changes
I know everythng today! What about tomorrow? I reay dont understand why reguators keep
changng the bascs and makng us pay for noncompance. There s no year wheren SEC, BIR,
and Accountng and audt promugatng bodes ddnt make amendments, revsons, mprovements and
the kes on aws, rues and reguatons and standards. They keep changng and you shoud aways be
updated! It s our persona and professona responsbty to be updated.
Even CPA canddates are bothered because what they know when they graduated may not be the
same thng they shoud know f they fa to pass the rst try.
/st 5 @aintaining independence and integrity
Your propose ths, n accordance wth the standards, but your cent want that snce that has more
busness sense. Your cent wants to pay ess taxes. Your cent wants to report more prot to
stakehoders. Your cent beeves so much n you and asked you to bookkeep the company you are
audtng. You en|oy the gft gven by your cent - a new car!
Keep n mnd that you are bound by the code of ethcs for professona accountants and you shoud be
dong away wth anythng that w dscredt the professon. Wegh thngs. We are here to
provde professona servcesand we shoud aways consder pubc nterest. Voaton may cause the
revocaton of our cense, our worst, can even put us behnd bars.
These chaenges are aways present and w test us, on how strong our stands are when t comes to
dong the rght thng. These w test us how can we prove ourseves and show our cents how we can
provde them exceptona cent servce wthout compromsng our ntegrty and the quaty of our work.
If we address these chaenges appropratey, we w be the professona accountants our cents can
never ahord to ose.
The accounting services industry here
in the Philippines
http://www.ukessays.com/essays/soca-work/mpact-schoo-excuson-soca-work-
essays.php
Introduction
!f communication uses a lan*ua*e to be able to be understood5 business $as
its own lan*ua*e too and it is )nown as accountin*( Accountin* is essential to
a business( !t is needed to evaluate t$e situation of t$e business( 0$e
information *enerated by accountin* s$ould be clear to w$om it is intended for
and s$ould be prepared for t$e purpose of $ow t$e information s$ould be
used( 0$ere are different types of accountin* based on t$e lecture notes
?+7'7; for t$is wee)L financial accountin*5 mana*ement accountin*5 and
financial mana*ement(
! $ave to a*ree t$at t$e accountin* profession indeed $as lost its way and is
no lon*er $elpin* t$e reAuirements of various users of accountin* information
in a way w$ic$ is suitable and important for t$e worldwide commerce settin*
of today( 0$e bi**est *ap ! $ave noticed t$ese days t$at accountin* still $as
not accurate measurement for is web traffic( ! own and mana*e a local forum@
based website and our web traffic accordin* to some is already wort$ a lot of
money( #pinions and t$e correspondin* valuation of our web traffic vary
dependin* on t$e perspective of t$e specialists w$o evaluates it( &astaldo
?+77-; $as confirmed suc$ observation by statin* t$at most overloo) to
associate monetary wort$ to t$e varyin* types of web traffic and it is $ardly
ever stated into t$e wor)s$eets( &ut a*ain t$is opinion about $ow t$e
accountin* profession and its pat$ of $ow it serves t$e various users of t$e
information it needs is on case to case bases w$ic$ depends on t$e type of
or*ani1ation t$at needs t$e information( &ut if ! were to base it on our
&usiness Process #utsourcin* ?&P#; business5 ! would $ave to say t$at !
disa*ree because everyt$in* t$at we want to )now is clearly s$own in blac) in
w$ite on paper based on t$e e2ternal and internal auditor4s assessment( As
w$at my previous module4s instructor said Bit dependsC ?9illiams5 +7'7;(
0$ere are various *roups w$o use t$e accountin* information( 0$ese are t$e
followin* most important *roups t$at $ave been identified by t$e Mana*in*
Resources boo) ?+7'7;L customers5 competitors5 employees5 *overnment5
community representatives5 investment analysts5 suppliers5 lenders5
mana*ers5 owners( 0$e *reater part of t$ese cluster accordin* to t$e
Mana*in* Resources boo) ?+7'7; e2teriorly related to t$e business but t$ey
$ave a sta)e in t$e business( 0$e information t$at is needed by t$e said user
*roups is prepared for t$e purpose on $ow t$ey will use t$e information5 t$e
information s$ould be of importance to t$e needs of t$e user4s and t$ey would
distin*uis$ w$at it is t$ey would li)e to )now basin* on t$e details presented
to t$em(
Accordin* to an in@dept$ study by 0ullao5 et( al ?+77';5 since t$e '--74s t$e
accountin* services industry $ere in t$e P$ilippines $as faced c$allen*es and
pressures $ave caused re@evaluation of t$e function of t$e trade in t$e
economy5 t$e c$aracter of services and procedures used to provide clients
and t$e potential conseAuences of Bliberali1ation on accountin* services(C
Navarro ?+77>; stated t$at t$e accountin* profession $ere in our country $as
c$an*ed and is now at t$e forefront of leadin* t$e drive towards *ood
*overnance( 0$e dar) days of accountin* w$ic$ $as also affected t$e
accountin* profession $ere in t$e P$ilippines5 only $i*$li*$ted t$e mista)es
t$at t$e accountin* profession can brin* out and t$e lessons t$at $ave been
learned because of it( 0$e accountin* profession $ere also $ad celebrated
cases suc$ as t$e financial reversal at CAP5 Gictorias Millin*5 Piltel5 Ramcar5
of w$ic$ t$e effects and conseAuences of t$e said scandals are still a
stumblin* bloc) accordin* to Navarro ?+77>;( 0$e dar) days of +77' and +77+
s$owcased t$e e2posure and collapse of %nron5 as well as ot$er ma<or
corporations in t$e 6S owin* to t$e s$orta*e of t$orou*$ness in financial
reportin* or utter disobedience of accountin* standards wit$ t$e simultaneous
conspiracy of ban)ers5 financial advisors5 bro)ers and e2ternal auditors( 0$e
profession can only move forward and loo) at w$at $appened as a learnin*
e2perience to serve as a *uide for t$e future( Accordin* to Navarro ?+77>;5 t$e
P$ilippine accountin* and re*ulatory framewor) is molded after t$e 6S
structure and $as followed t$e c$an*es in t$e 6S t$rou*$ t$e years( !t was
not a surprise w$en parallel loop$oles in our accountin* and auditin* system
were found w$en t$e scandals s$oc)ed t$e accountin* profession in t$e dar)
days( !nternationally5 reforms were initiated worldwide accordin* to &adawi
?+77>;5 in order to re@establis$ t$e investor4s fait$ in t$e accountin*
profession5 financial reportin*5 and t$e *lobal financial mar)ets( 0$e
Sarbanes@#2ley Act of +77+ was passed and President Geor*e &us$ si*ned
t$e said Act into law ?Public law '7.@+7/;( 0$e said act produced a bi*
transformation towards compliance observance of lar*e 6S and non@6S
companies w$ic$ mandated t$e important user *roups ?e2ecutives5 auditors5
board of directors; to underta)e measures to implement responsibility5 *reater
accountability and t$at financial reportin* s$ould be transparent( 0$e Public
Company Accountin* #versi*$t &oard was also created to set@up a new
s$ield in financial reportin*( 0$e scandals became a turnin* point for t$e
accountin* profession $ere in t$e P$ilippines( A serious review of t$e et$ics
and t$e policy and a re@evaluation of t$e practice of t$e profession were done(
Companies now are reAuired by t$e Securities and %2c$an*e Commission to
follow a new set of reAuirements and rules5 rules t$at are concentrated on
promotin* a stron* obedience to t$e improved standards on accountability5
transparency and fairness5 t$is code is w$at is )nown as t$e Code of
Corporate Governance of +77+ w$ic$ $ad a revision on +77-( Correspondin*
s$ifts from t$e private sector and professional assemblies $ave also been
introduced( #t$er or*ani1ations and support *roups $ave also been launc$ed(
Accordin* to 3ortuna@!be ?+77E;5 t$e reaction of t$e P$ilippines to t$e
worldwide dilemma of corporate *overnance is passable5 but it is yet to be
coordinated in t$e 3ilipino corporation4s daily tas)(