Sheree Ebanks explains how the Cayman Islands Institute of Professional Accountants has evolved since its inception.
Our financial world isn't as new as we perhaps think it is. In fact, the moment early civilisations learned to exchange commodities, the concept of finance was born.
Advances in writing, mathematics, and currency in ancient Egypt led to the development of early accounting, and in 1494 a 27-page thesis on double-entry system bookkeeping was published for Venetian merchants. Simply titled "Details of Calculation and Recording", the book arguably played a major factor in laying down the foundation for modern day accounting. And the rest, as they say, is history.
ARRIVING ON THE SCENE
Perhaps a tad late to the financial scene, Grand Cayman in 1960 was a quiet place to be. With turtling as its main industry and a lack of banks on the island, it seemed an unlikely contender to rival the likes of London, New York and Singapore.
The game changer in 1965 was the opening of the islands' first trust company, the Bank of Nova Scotia Trust Company (now Scotiabank). Th is led to amendments to the Banks and Trust Companies Regulations Law, and suddenly businesses had new freedom to flourish.
Just two years later, a young accountant set up the first accountancy firm on the island. Doors began to open, and other firms elsewhere in the world realised the opportunity to establish themselves in a tax neutral jurisdiction. As more and more accountants began to arrive in the early 1970s, a small group of pioneers in Cayman's accountancy field decided to form the Cayman Islands Society of Professional Accountants which later became the Cayman Islands Institute of Professional Accountants.
QUALITY ASSURANCE REVIEWS
CIIPA has come a long way since those early days. Presented with an increasingly changing regulatory environment, CIIPA quickly understood that it needed to change right along with it. Therefore, when the Public Accountants Law came into effect in 2008, it ushered in a new era of regulatory oversight – with CIIPA taking on the role as regulator to the profession.
Just five years later, CIIPA was admitted as a full member of the International Federation of Accountants (IFAC). CIIPA completed its first, soft cycle review in 2015 while waiting for the passage of The Accountants Law (2016). This came into effect on November 28, 2016 and paves the way for the second review cycle in 2017. As such, CIIPA adheres and encourages its members to comply with the International Standard of Quality Control (ISQCI) and has established a process of Quality Assurance Reviews, reviewing and monitoring compliance by audit firms.
This process involves the selection of firms to be scheduled for review, with each firm reviewed once in any three year period. CIIPA has completed its first cycle of reviews in 2015 and will start the second phase in 2017, once the new Accountants Law is enacted and the accompanying regulations are passed. CIIPA works closely with the Institute of Chartered Accountants of England and Wales in this process. It is essential that reviews are performed in order to ensure not only that audits comply with professional standards, but firms meet the requirements of ISQCI and applicable audit standards. Once the reviews are complete, firms are provided with the findings, and a summary report is published on ciipa.ky.
Should deficiencies be identified, CIIPA will endeavour to support the firm in rectifying the deficiency; however, if the requirements are disregarded, the matter will be referred to investigation, and disciplinary action may be considered.
In addition to firm reviews, another member obligation to IFAC is ensuring members comply with International Education Standards (IES) and in particular IES7: Continuing Professional Development. Each year, CIIPA randomly selects a percentage of its membership who are required to submit their CPD record together with supporting evidence for review. If any deficiencies are noted, CIIPA will work with that member to ensure their hours are attained.
MEMBERSHIP & LICENSING REQUIREMENTS
Criteria is strict for membership and licensing. Regular members must comply with IES7 and Licensed Practitioners must be able to prove competency through experience and CPD. In order to maintain their ongoing membership with CIIPA, members are expected to continue certain obligations. Regular Members and Licensed Practitioners are expected to act diligently and in accordance with technical, professional and ethical standards. In order to be admitted as a Regular Member of CIIPA, an accountant must be in good standing with its Overseas Professional Accounting Institute (OPAI), maintain a minimum requirement of continued professional development hours, and prove legal status and residency in the Cayman Islands.
COMPLAINTS & INVESTIGATION
CIIPA strives to ensure complete competence and compliance, and therefore takes its complaints process very seriously. The process is governed by Part 4 – Discipline, of The Accountants Law, 2016. Anyone may bring a complaint against a member of CIIPA based on grounds ranging from incompetence to breach of professional standards. All formal complaints are received by Council, which will determine whether the claim should be referred to an Investigation Committee.
If there is a prima facie case, the Investigation Committee will then further refer the complaint to a Disciplinary Tribunal. To ensure a fair and impartial approach, the Disciplinary Tribunal has three rotating chairs who are not CIIPA members.
When it comes to accounting, CIIPA is not the only organisation with oversight responsibilities. The Cayman Islands Monetary Authority (CIMA) approves audit firms, and these firms must provide additional reporting requirements. CIIPA works closely with CIMA and the audit firms to ensure compliance with the Proceeds of Crime Law. In 2011, the Auditors Oversight Law was passed, establishing the Auditors Oversight Authority (AOA). The AOA is charged with regulating and supervising firms that conduct audits of the accounts of market traded companies. CIIPA is also working with AOA to develop efficiencies in the review and oversight process.
CIIPA worked closely with the Ministry of Financial Services on the new Accountants Law, 2016 and its accompanying Regulations. CIIPA's President Serge Berube noted that The Accountants Law, 2016 reflects changes in international oversight practices, ensuring CIIPA has the framework to enforce international Standards.
Globalisation has created a competitive landscape in the world of accounting, and CIIPA is poised to lead the accounting profession and the Cayman Islands into the future. It has come a long way in the past 45 years and its commitment to Cayman remains as strong as ever.
About the Author
Sheree is CIIPA's first appointed CEO, with over 40 years of experience in areas such as asset management and fiduciary services. She spent her early career years developing the bank and asset management business at one of Cayman's largest banks and trust companies later on taking on an executive position.
She holds a number of board positions in the Cayman Islands, and has participated in government representative bodies, assisting local and international matters.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.