LESOTHO INSTITUTE OF ACCOUNTANTS POLICY DOCUMENT ON CONTINUING PROFESSIONAL DEVELOPMENT

Transcription

1 LESOTHO INSTITUTE OF ACCOUNTANTS POLICY DOCUMENT ON CONTINUING PROFESSIONAL DEVELOPMENT EFFECTIVE FROM 1 ST JANUARY 2005 Approved by council of the Institute on 30 th November,2004 1

2 TABLE OF CONTENTS Page 1. Introduction 3 2. Continuing Professional Development (CPD) 3 3. LIA CPD Programme 4 4. Monitoring and Enforcement 8 5. CPD Sanctions 8 Approved by council of the Institute on 30 th November,2004 2

3 1. INTRODUCTION As from 1 January 2005, the Lesotho Institute of Accountants will be introducing a mandatory Continuing Professional Development (CPD) programme for all its members. The scheme will help ensure that members to develop and maintain their professional competences so as to provide high quality services to clients, employers and other stakeholders. This mandatory CPD comes as a result of the International Education Standard 7 (IES7) published by IFAC in May 2004 and revised in July 2012, requiring all IFAC member bodies to have a mandatory CPD programme for its members. The standard came into effect from the 1 st January CONTINUING PROFESSIONAL DEVELOPMENT (CPD) Continuing Professional Development (CPD) or Continuing Professional Education (CPE) can be described as the continuous maintenance, development and enhancement of the professional and personal skills, which Professional Accountants will require throughout their working lives. CPD can also be described as learning aimed at developing relevant capabilities of individuals to perform competently within their current and future professional environments. CPD is aimed at the post-qualification maintenance or enhancement of professional competence. Competence is the ability to perform the tasks and roles expected of a professional accountant, both newly qualified and experienced, to the standard expected by employers and the general public. Continued development of professional competence and lifelong learning are critical if the professional accountant is to meet these expectations. Competence is therefore not a static term, but evolves over a lifetime of learning. CPD ensure that members stay abreast of the developments in the profession, such as changes in Accounting/Auditing Standards, new practices in the market and technological development. It reassures employers that members are equipped with the latest and up-to-date skills and increases public confidence in the accounting profession. It furthermore reinforces the professional ethics that a professional accountant is expected to uphold. CPD is an extension of the education process leading to qualification as a professional accountant, where the professional knowledge, professional skills and professional values and attitudes gained continue to develop and are refined in order to be appropriate for the professional activities and responsibilities of the individual. In this regard one can distinguish between education and development. Approved by council of the Institute on 30 th November,2004 3

4 Education is a formal, structured and systematic learning process whereby individuals develop knowledge, skills, character, or other abilities. Education also includes formal learning processes such as on-the-job and off-the-job training. Development is the acquisition of capabilities, which contribute to competence, however achieved. Development is therefore broader than education and includes a wide range of processes such as learning (including education); experience; reflection; observation; or receipt of information; other structured and unstructured learning activities or natural growth over time. 3. LIA CPD PROGRAMME The LIA CPD programme revolves around the individual member s learning needs in order to ensure that the CPD is relevant to the member s current and future professional responsibilities. Determining the learning needs The LIA CPD requirement will rely on the reasoned professional judgement of a member to determine the relevant CPD programme to be undertaken. In order words each member is expected to be able to determine the needs that are relevant to develop and maintain his competence. However, the judgement should be reasonable in that there should be a correlation between the CPD programme and the general current and future professional responsibilities of that member. In order to assist members to determine the relevant CPD needs; LIA has developed the following Table Of Competences (TOC) for members with different responsibilities. In each TOC grouping, members should assess its relevance to their current and future professional responsibilities and the level of their competence in it against the required competence to execute their responsibilities well. This TOC will assist members to assess their current levels of competence and identify or set targets for development or maintenance of the competence. Approved by council of the Institute on 30 th November,2004 4

5 THE LIA CPD TABLE OF COMPETENCES (TOC) TOC Grouping Competence to be developed or maintained Specific Relevance General Relevance Group 1 Professional ethics All professional Group 2 Group 3 Group 4 Group 5 Technical: Taxation, Auditing, Financial management, Financial accounting Management: strategic & operational management, leadership skill, change management, HRM, project management Specialist areas: IT, Marketing, HRM, Law, Business economics Others: Business awareness, communication, interpersonal, relevant personal development Work related Work related Work related All professionals Professionals with possible future responsibility in this area Professionals with future responsibility or overlaps All professional An example Using the above skills grouping, a member whose work primarily involves budgeting process and monitoring would be expected to have a significant portion of their CPD in activities that are in Group 2, but should also have elements of CPD on say Group 1 and 5. But again if their future responsibilities are expected to include project management, then Group 3 may be deemed to be also relevant. It is important to note that professional ethics is relevant to all members. This is because LIA is committed towards promoting the highest levels of professionalism and integrity amongst its members underpinned by ethical behaviour amongst its members. The CPD approach The objective of CPD is to assist professional accountants to develop professional competence in order to provide services of high quality in the public interest. In pursuit of this objective, LIA has adopted the input-based approach that sets the amount of learning activity that is appropriate for a member to develop and maintain competence. With this input-based approach CPD undertaken is measured in activity hours. Approved by council of the Institute on 30 th November,2004 5

6 Once a member has determined the required competences or needs he should identify activities that will aid in attaining or maintaining the competence or needs. A member may need to engage in several activities to meet the demands of the identified competence. There are many learning opportunities that a member may seek to fulfil their CPD needs including; Attending short-term and long-term courses, workshops, seminars and conferences, Delivering presentations & business talks, Research (field, internet, books, journals etc) Publishing articles, Reading business and technical journals, newspaper, online media, books Participation in relevant forums (e.g. LIA committees), Coaching and mentoring Access to CPD The Institute is committed to facilitating access to CPD for its members. There will be an annual programme of activities aimed at meeting some of the CPD requirements for members. This programme will include CPD activities like seminars, workshops, courses, presidential breakfast etc that are hosted or endorsed by LIA. Members are encouraged to utilise these CPD events as verification will be easier. However, in addition to these LIA events, members are free to engage in other CPD activities as long as they are relevant, measurable and whenever possible, verifiable. Annual CPD required Each member will be expected to fulfil 40 hours of CPD per annum and with a minimum of 20 hours being CPD hours earned in that year. Of this 40 hour annual requirement, at least 28 hours should be in structured activities. The annual CPD programme is based on the calendar year. A member who has earned more than 40 CPD hours in one year may carry forward the excess CPD hours up to the 3 rd year. This means that carried forward CPD should be confined within a 3 year period of it taking place. A member will be allowed to carry forward CPD from structured activities only. In any case a member is required to complete at least 20 hours in each year irrespective of CPD brought forward. This is to ensure that members will still maintain a certain level of CPD learning in each year. Approved by council of the Institute on 30 th November,2004 6

7 Verification It is acknowledged that not all the learning that a member engages in will be objectively verified by a third party. However, such learning cannot simply be ignored as it still contributes towards the development of a member. In fact a strong argument is that even with verifiable CPD, where the input CPD approach is being used, the evidence that the CPD has taken place does not guarantee that a member has developed or maintained his competence. LIA has grouped the CPD that a member may engage in into two types of activity as follows; (a) Structured activities This is the type of CPD that can be independently and objectively verified to have taken place. Each member will be required to fulfil at least 28 hours of this structured CPD per annum. Examples of this structured CPD activities include the following; attendance at courses, seminars, conferences, workshops and briefings, distance, online and open learning study programs and long term study leading to further qualifications, delivering presentations at courses, conferences or seminars serving on technical panels, organised and monitored discussion groups and forums, Writing technical and business articles (b) Unstructured activities The unstructured CPD activity is not always easily verifiable. Members should still retain evidence of this CPD and to measure it to verify its existence although it is not easy to determine whether it was actually done. Each member may claim up to a maximum of 12 hours of this unstructured CPD per annum. Excess unstructured CPD shall not be carried forward into the next period and will be forfeited. Due to the nature of this type of activity, members claims of CPD will be taken at their face value but where the CPD committee doubts the authenticity of the CPD hours claimed, they may thoroughly review and or test the reasonableness of the hours claimed. CPD committee may from time to time also issue guidelines on the unstructured CPD activity. Examples of this unstructured CPD activity may include the following; Approved by council of the Institute on 30 th November,2004 7

8 Reading technical and business material Following financial and business matters in print and media Researching technical or business issues from printed material, internet or field research. Mentoring and coaching A member will be required to measure, record, retain and submit on request evidence of all CPD activity undertaken. This CPD record will be kept by way of filled-in log book and evidence records. Evidence may include course agenda, attendance confirmation, minutes of meetings, results of tests, office records, references of articles read or written etc. A CPD log book will be available to members in a manual form and once the website development has been completed it will also be available in electronic form on the website. The electronic log book on the LIA website will enable members to log in their hours for CPD activities completed. Members will be able to view their past record in read-only access. Members will also be able to print copies of the electronic log book to fill in manually or update electronically and print copies for their records. An updated log book should be kept by each member and submitted to the Secretariat for evaluation by the Compliance Committee at stated intervals or on demand. The log book and evidence records should be kept by members for at least 5 years. 4. Monitoring and Enforcement The Compliance Committee will assume responsibility for monitoring of the programme, and in that respect will accept CPD hours claimed, seek to amend CPD hours claimed, reject CPD hours claimed seek evidence of CPD hours claimed from members and select some members annually for review of their CPD documentation. 5. CPD Sanctions A member who fails to meet his or her CPD obligations shall be subjected to the disciplinary processes and be liable to the following sanctions; If a member fails to meet 10% of the CPD hours required each year he or she shall be reprimanded plus make up the deficiency in CPD hours. 30% of the CPD hours cumulatively over three years, he or she shall be liable to pay 150% of the membership fees plus making up the deficiency in CPD hours. 50% of the CPD hours cumulatively over three years, he or she shall be liable to pay 250% of membership fees plus make up the deficiency in CPD hours. 51% or above of the CPD hours cumulatively over three years, he or she shall be suspended from practice plus make up the deficiency in CPD hours. Approved by council of the Institute on 30 th November,2004 8

9 Exemptions The CPD obligations will not apply to; 1) Retired or honorary members 2) Those who show proof of meeting requirements of other IFAC members Re-instatement into Membership A member will need to pay outstanding membership fees at 250% plus fulfil owing CPD hours. Approved by council of the Institute on 30 th November,2004 9