IFAC releases action plan for accountants fighting corruption and crime

Accounting

The International Federation of Accountants published an action plan Tuesday for combating corruption and economic crime in an effort by the global accounting profession to stem fraud around the world.

The Action Plan for Fighting Corruption and Economic Crime includes more than 30 specific actions for IFAC and the accounting profession related to education, evidence-based policy, global standards, partnership and thought leadership. It was developed with engagement from IFAC’s 180 member organizations, as well as IFAC’s advisory groups, network partners and other global organizations. The plan was inspired by the International Bar Association’s Anti-Corruption Strategy for the Legal Profession and was developed in close coordination with the IBA, with which IFAC will continue to coordinate.

The plan is based on five pillars: harnessing the full potential of education and professional development, supporting global standards, contributing to evidence-based policymaking, strengthening IFAC’s impact through engagement and partnership, and contributing IFAC’s expertise through thought leadership and advocacy.

IFAC offices

Photo courtesy of IFAC

Introduction of the plan comes as the pandemic has exacerbated some of the factors contributing to economic crimes and corruption, as money has poured into aid programs that have been exploited by criminals and fraudsters. In the U.S. alone, the Justice Department has been pursuing hundreds of cases related to fraud in the Paycheck Protection Program, Economic Injury Disaster Loans and expanded unemployment aid, with estimates of losses in the hundreds of billions of dollars.

“Corruption and related economic crimes, such as money laundering, bribery, tax evasion and fraud, are significant obstacles to economic growth and human development and, ultimately, to achieving the UN Sustainable Development Goals—all seventeen of them,” said IFAC CEO Kevin Dancey in a statement Tuesday. “Our action plan illustrates some time tested and some new ways that make it clear that the global accountancy profession is a central ally in the fight. We look forward to working with our member organizations and other partners to make a real difference and drive positive change.”

The action plan leverages the accounting profession’s reach across public practice, business and the public sector to contribute to the fight against corruption and support integrity and transparency in business and government, as well as effective global and domestic policymaking. 

IFAC also sees educational value for the profession in the action plan. 

“We’re going to be reviewing the extent to which corruption and money-laundering topics are covered in accountancy education worldwide,” said Scott Hanson, director of public policy and regulation at IFAC, during an interview for an upcoming podcast with Accounting Today. “The goal here is to start an evidence-based conversation about whether any changes need to be made to better integrate these topics into accountancy curricula, or if there’s an opportunity to exchange best practices. That’s one of the first key items for the anti-corruption action plan is our accountancy education review.”

IFAC has further goals as well related to the action plan. “We’re going to launch another review of anti-corruption corporate reporting by large listed companies worldwide,” said Hanson. “The idea here is to understand what companies are reporting, what topics are being covered, which standards are being used, and whether and how that information is being assured.”

The group is also working with partner organizations on the effort. “Third, we are about to launch a third round of donor-funded capacity projects focused on developing accountancy capacity in the public sector,” Hanson added. “These projects are being funded by the global vaccine alliance, GAVI, and the Global Fund, as well as USAID. We have pilot projects in Ghana and Burkina Faso set to launch in September, and expect to broaden these programs into more countries in due course.”

IFAC will also be releasing a toolkit for accountants to use in their organizations worldwide. “We are developing a domestic engagement toolkit for professional accountancy organizations around the world,” said Hanson. “The idea here is to encourage PAOs, professional accountancy organizations, and prepare them to reach out to key stakeholders in their countries and put themselves at the center of their local anti-corruption conversation.”

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