1. Accounting and Corporate Regulatory Authority (ACRA)

Role and Functions

The Accounting and Corporate Regulatory Authority (ACRA) is the primary regulatory body overseeing public accountants and public accounting entities in Singapore. Established in 2004, ACRA’s responsibilities include:

• Registration and Regulation: ACRA is responsible for the registration of public accountants and public accounting firms. It ensures that these professionals meet the necessary qualifications and adhere to the required standards.
• Monitoring and Enforcement: ACRA conducts regular inspections and reviews of public accounting entities to ensure compliance with auditing standards and regulations. Non-compliance can result in disciplinary actions, including fines and suspension.
• Standard Setting: ACRA plays a crucial role in developing and maintaining auditing standards in line with international best practices. It works closely with other regulatory bodies and industry stakeholders to update and refine these standards.

Key Initiatives

ACRA has launched several initiatives to enhance the quality of audits in Singapore:

• Practice Monitoring Programme (PMP): This program involves regular inspections of public accountants and accounting firms to assess their compliance with auditing standards and professional practices.
• Audit Quality Indicators (AQIs): ACRA has introduced AQIs to help audit committees and other stakeholders assess the quality of audits. These indicators include measures such as staff experience, training hours, and audit hours.
• Financial Reporting Surveillance Programme (FRSP): Under this program, ACRA reviews the financial statements of listed companies to ensure compliance with the Financial Reporting Standards (FRS).

2. Institute of Singapore Chartered Accountants (ISCA)

Role and Functions

The Institute of Singapore Chartered Accountants (ISCA) is the national accountancy body in Singapore. While it does not have regulatory authority, ISCA plays a significant role in supporting and enhancing the auditing profession through:

• Professional Development: ISCA provides training and development programs to ensure that auditors maintain high standards of professional competence and ethics.
• Advocacy and Representation: ISCA represents the interests of the auditing profession in discussions with regulatory bodies and other stakeholders. It advocates for policies and practices that enhance the quality and integrity of audits.
• Standard Setting and Guidance: ISCA contributes to the development of auditing standards and provides guidance to its members on best practices and emerging issues in auditing.

Key Initiatives

ISCA’s initiatives aimed at improving audit quality include:

• Continuing Professional Education (CPE): ISCA offers a wide range of CPE programs to help auditors stay updated with the latest developments in auditing standards and practices.
• Ethics and Professional Conduct: ISCA has established a Code of Professional Conduct and Ethics that its members must adhere to, promoting integrity and ethical behavior in the auditing profession.
• Technical Resources and Support: ISCA provides its members with access to technical resources, including publications, practice guides, and expert advice, to support high-quality audit practices.

3. Monetary Authority of Singapore (MAS)

Role and Functions

The Monetary Authority of Singapore (MAS) is Singapore’s central bank and financial regulatory authority. While its primary role is to oversee the financial industry, MAS also has significant responsibilities related to auditing:

• Regulation of Financial Institutions: MAS sets and enforces regulations for financial institutions, including banks, insurance companies, and capital market intermediaries. These regulations include requirements for internal and external audits.
• Audit Requirements: MAS mandates that financial institutions undergo regular audits conducted by independent auditors. These audits ensure that financial institutions comply with regulatory requirements and maintain sound financial practices.
• Supervision and Oversight: MAS supervises the work of auditors who audit financial institutions, ensuring that they adhere to the highest standards of professional conduct and auditing practices.

Key Initiatives

MAS has implemented several initiatives to strengthen the auditing framework for financial institutions:

• Risk-Based Supervision: MAS adopts a risk-based approach to supervision, focusing on areas of higher risk and ensuring that auditors pay particular attention to these areas during their audits.
• Collaboration with ACRA and ISCA: MAS works closely with ACRA and ISCA to ensure that auditing standards and practices in the financial sector are aligned with national and international best practices.
• Guidelines and Circulars: MAS issues guidelines and circulars to provide auditors with specific instructions on areas such as risk management, financial reporting, and regulatory compliance.

4. Singapore Exchange (SGX)

Role and Functions

The Singapore Exchange (SGX) is the primary stock exchange in Singapore, responsible for regulating companies listed on its platform. SGX’s regulatory functions include:

• Listing Requirements: SGX establishes listing requirements that include provisions for the appointment of auditors and the conduct of audits. These requirements ensure that listed companies maintain high standards of financial reporting and disclosure.
• Monitoring and Enforcement: SGX monitors the compliance of listed companies with its listing rules, including audit requirements. It has the authority to take enforcement actions against companies and auditors for non-compliance.
• Corporate Governance: SGX promotes good corporate governance practices among listed companies, including the role of audit committees in overseeing the audit process.

Key Initiatives

SGX’s initiatives to enhance audit quality and corporate governance include:

• Code of Corporate Governance: SGX has established a Code of Corporate Governance that sets out principles and guidelines for good corporate governance practices, including the responsibilities of audit committees.
• Regulatory Reviews: SGX conducts regular reviews of listed companies’ financial statements and audit reports to ensure compliance with listing rules and auditing standards.
• Investor Protection: SGX works to protect the interests of investors by ensuring that listed companies provide accurate and timely financial information through rigorous audits.

Conclusion

The regulatory framework governing audits in Singapore is comprehensive and multifaceted, involving several key bodies including ACRA, ISCA, MAS, and SGX. Each of these bodies plays a crucial role in ensuring that audits are conducted with integrity, professionalism, and adherence to high standards. Their collaborative efforts contribute to the overall reliability and transparency of financial reporting in Singapore, fostering investor confidence and supporting the country’s reputation as a leading financial hub. As the auditing landscape continues to evolve, these regulatory bodies will remain pivotal in maintaining the robustness and effectiveness of Singapore’s audit regulatory framework.

Key Regulatory Bodies Governing Audits in Singapore