At That Point
  • home
  • services
  • about us
  • our work
  • our thoughts

Final call for applications to help Professional Accountants (SA) qualify

28/5/2018

0 Comments

 
The South African Institute for Professional Accountants (SAIPA) says applications to its Project Achiever programme, which is geared to assist those writing the November 2018 SAIPA Professional Evaluation (PE) examination, will close on May 30th  and has urged entrants to not miss this deadline.
 
Classes are set to start on June 2nd.
 
New entrants to the professional accountancy profession are mandated to pass the PE examination, which ensures they adhere to international education standards. This is done by assessing whether an aspiring professional accountant meets the minimum competence or proficiency level to be assigned the designation of Professional Accountant (SA).
 
The designation is one of the few authorised by the South African Revenue Service to provide services as a tax practitioner. A Professional Accountant (SA) can also perform numerous functions, including issuing reports in terms of the Companies Act, Close Corporations Act, and Micro lending industry regulations, Sectional Titles Act, Non-Profit Organisations Act, and Schools Act.
 
Inception
For many aspiring Professional Accountants (SA), the PE examination can be both an important step in the development of a Professional Accountant (SA) and a potential roadblock for those who are unable to pass the exam.
 
From here Project Achiever was born in 2015, a programme funded by Finance and Accounting Services Sector Education and Training Authority (FASSET) that assists candidates in successfully completing the examination and becoming designated SAIPA professional accountants. Although the programme was implemented to facilitate the transformation agenda of the profession, in other words particularly aimed at helping newly qualified black accountants, it is open to all candidates.
 
Last year SAIPA also launched the online version of Project Achiever to reach interested candidates in outlying areas.
 
The 12-week, competency-based and learner-centered programme that focusses on the holistic development of the young professional.
 
It is not a content-based programme designed to get people through an examination. Rather it exposes candidates who have completed the professional development and practical experience component of their development to the ‘soft’ skills components required to become ethical and proficient professionals. This enables them to develop into professional accountants able to provide solutions to the issues brought to them by their clients.

Candidates are encouraged to consolidate their knowledge through self-study and research and to apply this to develop practical and implementable solutions to business scenarios and problems in a multi-disciplinary manner through group discussions.
 
The PE examination is further aligned with the International Education Standards 6 (IES 6) Assessments, with an emphasis on the principles of competency-based assessment. 
 
“The benefit for future employers or clients is that they will benefit sooner from the combined competence and expertise of the Professional Accountant (SA) beyond the preparation of financial statements for compliance purposes,” explains Ngobese.
 
For more information regarding requirements and applications for Project Achiever please click here.

ENDS

MEDIA CONTACT: Idéle Prinsloo, 082 573 9219, idele@thatpoint.co.za, www.atthatpoint.co.za  
 
For more information on SAIPA please visit:
Website: www.saipa.co.za
Twitter: @SAIPAcomms
LinkedIn: South African institute of Professional Accountants Company
Facebook: South African Institute of Professional Accountants
0 Comments

Decrypting blockchain and cryptocurrencies

25/4/2018

0 Comments

 
Author: Darren Gorton, Finance Executive at the South African Institute of Professional Accountants (SAIPA)
 
Cryptocurrencies are dominating the media. This one has collapsed, that one is on the rise, and a new one is around the corner. Their flavour isn’t quite as piquant today as it was yesterday thanks to fraud, an upsurge in Initial Coin Offerings (ICO) and the challenges that face its legislation and regulation across country and government.
 
In April the South African Revenue Service (SARS) announced that it will be treating cryptocurrencies using normal income tax rules. Affected taxpayers will, therefore, be expected to declare cryptocurrency gains or losses as part of their taxable income in the tax year in which it is accrued.
 
Cryptocurrencies are also often confused with blockchain which is a complex, layered technology that provides the backbone of cryptocurrency, but has the potential to deliver so much more to enterprise, industry and the consumer.
 
Cryptocurrencies may be getting all the airtime, but blockchain is the underlying technology, and this application of the technology is only a small part of what this technology can enable. Blockchain itself is largely unexplored, even though it has been around for nine years now.
 
To fully understand the potential of blockchain, it’s worth understanding precisely what it is and what it is not. According to Deloitte, blockchain is defined as a ‘digital and distributed ledger of transactions, recorded and replicated in real time across a network of computers or nodes’. It is already being used as a way of replacing databases thanks to its secure, centralised network – taking the vulnerable database of today and turning it into something that can be trusted.
 
If a bank runs its own database, they can change information without anyone knowing. With blockchain, it is impossible to do so without leaving a digital trail. This means it provides a system that all parties can trust inherently, and the applications of this high level of transparency and security aren’t limited to just the finance industry.
 
Removing the middleman
By implementing blockchain, the business can cut out the middlemen who originally provided the verifications needed for transactions. There is even talk of it being implemented in security exchanges where the exchange is currently the middleman between the investor and the company they want to invest in. While the technology may not have an immediate and profound impact on the man on the street, for the accountant it potentially offers an additional layer of trust to the numbers.
 
Blockchain provides the certification between two parties in a transaction, acting as the verification in itself. There is increased emphasis on the validity and accuracy of the information. The Professional Accountant (SA) can lean on the security afforded by blockchain to focus on adding value to the enterprise across financial reporting, analysis and insights.
 
Of course, this does mean that the accounting industry needs an understanding of the technology, how it supplies the verification and the reasoning behind its security and validity.
 
Businesses are set to adopt this technology, of that there is no doubt. It won’t happen overnight, and the middlemen are going to push for a lot of legislation to delay the advance of blockchain technology as far as possible or even make some of the applications unlawful. It is a battle that technology will most likely win in the long run, and the Professional Accountant (SA) needs to know how this will impact on clients and the industry they are working in.
 
For the Professional Accountant (SA), the pressure is on. By understanding how blockchain works and the impact it has, they can provide clients with exceptional insight into everything from the latest regulations to innovative applications.
 
The circle of success
In South Africa, we still have a way to go, but that doesn’t mean that the Professional Accountant (SA) can put their head in the sand and ignore it. As cryptocurrency fluctuates and organisations such as the Reserve Bank, SARS and other government departments implement regulation to manage the movement of money around the globe, blockchain is going to evolve at a rapid pace.
 
Another aspect to consider is information. The POPI Act and other similar forms of legislation that control information are set to impact on the development and adoption of blockchain. It connects to the digital lives that people are leading, the regulation around what companies can or cannot maintain, and how blockchain can support compliance.
 
It is difficult to say how blockchain and cryptocurrencies are going to play out. The Professional Accountant must be aware of how cryptocurrencies are declared in business records and monitor regulation. They have to know what to look out for, the risks that are involved and the impact on the business. And they need to recognise that these technologies aren’t going to leave any time soon.
 
ENDS

MEDIA CONTACT: Idéle Prinsloo, 082 573 9219, idele@thatpoint.co.za, www.atthatpoint.co.za  
 
For more information on SAIPA please visit:
Website: www.saipa.co.za
Twitter: @SAIPAcomms
LinkedIn: South African institute of Professional Accountants Company
Facebook: South African Institute of Professional Accountants
0 Comments

Heavier compliance may be on horizon for professional accountants

26/3/2018

0 Comments

 
Author: Faith Ngwenya, Technical Executive at the South African Institute of Professional Accountants (SAIPA)
 
The proposed inclusion of professional accountants into a schedule of the Financial Intelligence Centre Act (FICA), making them accountable institutions, will have major repercussions for the accountancy industry.
 
The Financial Intelligence Centre has identified the sector as being “vulnerable” to money laundering and terror financing activities.
 
Accountable institutions
Institutions identified in Schedule 1 to the FICA include lawyers, estate agents and banks and in Schedule 3 include motor vehicle dealers and dealers in Kruger rands.
 
The act requires that accountable institutions register with the Financial Intelligence Centre (FIC), that they disclose the identity of their clients to the centre, train their employees, appoint a compliance officer, draw up a risk register and plans to mitigate the risks, give them additional recordkeeping duties, and oblige them to report to the FIC.
 
SAIPA has raised concerns in terms of the compliance burden that will now go way beyond the existing obligation to report suspicious transactions or activities. The latest proposals will impact on the administrative and financial burden of especially small practices and people running their own businesses.
 
Legislative alignment
The “overly broad” wording of the proposal is upsetting. It also appears to be in conflict with existing legislation such as the Companies Act. In terms of the act a person can register his own company by simply registering with the Companies and Intellectual Properties Commission.
 
SAIPA is not shunning its responsibility as a regulatory body, but it does request much more clarity on some of the wording, to understand the impact of the proposals. Questions which beg answers are whether there will be monetary thresholds or number of employees which may exclude some of the smaller firms from this heavy compliance burden, whether there will be financial or administrative assistance if smaller firms are not excluded, and what exactly defines “assisting” a client.
 
Who will be an accountable institution
According to the FIC any person who carries on a business of preparing for or carrying out transactions for a client concerning the following activities will be considered an accountable institution:
 
* assisting a client in the planning or execution of the buying or selling of immovable property; the buying or selling of a business; the opening or management of a bank, investment or securities account; the organisation of contributions necessary for the creation, operation or management of a company outside South African; the organisation of contributions necessary for the operation or management of a close corporation;  the creation, operation or management of a company or a close corporation; and the creation, operation or management of a trust outside the country.
* representing a client in any financial transaction;
* assisting a client in disposing of, transferring, receiving, retaining, maintaining control of or in any way managing any property; or
* assisting a client in the management of any investment.
 
Money launderers and accountants
According to the FIC professional accountants are “particularly useful” for money launderers when it comes to the seeking of financial and tax advice to reduce their tax liabilities or to place vast amounts of proceeds.
 
They also approach professional accountants to help with the setting up of companies and trusts to hide the proceeds of crime and the perpetrator of crime. They also use property transfers as a cover to move illegal funds and they use accountants to get access to financial institutions.
 
SAIPA believes there are solutions to deal with concerns raised by the FIC, but that the current proposal is a kneejerk reaction to the behaviour of unscrupulous practitioners.
 
However, if the proposal is accepted as it is accountants who are awarded the professional accountant designation by the institute must be aware that they will be considered an accountable institution. They will have to comply with the requirements set out in the FICA schedule.
 
However, SAIPA is of the view that the obligations that will be placed on a professional account is to become a forensic investigator and an auditor – all in one.
The FIC is of the opinion the inclusion of professional accountants will improve its capability for producing “better quality and more substantive financial intelligence reports” for use in solving crime.
 
A concern is whether the FIC will have the capacity to give due regard to all the new sources of information.
 
ENDS
 
MEDIA CONTACT: Idéle Prinsloo, 082 573 9219, idele@thatpoint.co.za, www.atthatpoint.co.za  
 
For more information on SAIPA please visit:
Website: www.saipa.co.za
Twitter: @SAIPAcomms
LinkedIn: South African institute of Professional Accountants Company
Facebook: South African Institute of Professional Accountants
0 Comments

​Is Government’s Free Tertiary Education Plan Realistic?

6/3/2018

0 Comments

 
During his 2018 national budget speech on 21 February, former Finance Minister Malusi Gigaba announced that the government would invest R57 billion in free tertiary education. This is to help those from households with a combined income of under R350,000 per annum to study further and secure better futures for themselves.

Support for the plan
While the South African Institute of Professional Accountants (SAIPA) fully supports assistance to enable higher education, measures must be implemented to ensure the country benefits from this substantial investment. This is according to Ettiene Retief, Chairman of the National Tax and South African Revenue Service (SARS) Committee at SAIPA.
 
“Yes, we need to assist those who aspire to be more but find themselves bound to a lower income group,” he states. “However, according to the then Finance Minister, this will be the fastest growing expense line item in our budget year on year, and several shortcomings need to be addressed.” The allocation is expected to see an average annual growth of 13.7%.

No correlation with skills shortage
South Africa suffers from a shortage of specific skills and would do well to direct funding to the degrees that will give it an economic advantage. “We should provide guidance to steer the youth as merely obtaining a degree will not guarantee a job or ensure an economic return on investment,” says Retief. Free degrees should be used as an incentive for young people to follow valued career paths.

No skills retention plan
After completing their studies, graduates are under no obligation to remain in South Africa. “If they use their degree as an entry qualification to another country,” says Retief, “we immediately lose the benefits of free education.” Some professions require a period of practical application, like doctors serving in state hospitals, and Retief suggests that a similar requirement should be made of free degree holders.
 
There is no indication of a limit to the amount of time a student may spend on their degree. According to Retief, study credits may remain valid for up to 10 years. “When a person pays tuition or gets a student loan, there is some urgency in completing the degree, but if funding is unlimited the student can take 10 years to complete a three-year degree”. “Also, how do we ensure that the person will even obtain their degree after spending years at university”. Free degrees should therefore be time restricted.
 
Also, higher-education institutions have limited capacity, and can only accommodate a limited number of students.
Lower appreciationIt’s a well-established fact backed by much research that when people get something for free, their appreciation of its value is much lower than if they had to pay for it themselves, even if they only make a small investment. “While free tertiary education is commendable,” says Retief, “the learner should make some investment themselves. This will give students ownership of their studies and the perseverance to achieve their goals.”
 
Overall, Retief contends that the government should only implement free tertiary education with comprehensive guidelines and limitations. “Rather than announcing an arbitrary figure, they need to provide details on how the plan will be implemented and how it will achieve its aim of developing the skills the country needs.”

ENDS

MEDIA CONTACT: Idéle Prinsloo, 082 573 9219, idele@thatpoint.co.za, www.atthatpoint.co.za 
 
For more information on SAIPA please visit:
Website: www.saipa.co.za
Twitter: @SAIPAcomms
LinkedIn: South African institute of Professional Accountants Company
Facebook: South African Institute of Professional Accountants
0 Comments

Budget Speech: Expectations of tax increases still linger

20/2/2018

0 Comments

 
South African taxpayers have to prepare themselves for several tax increases this year in order for the government to plug the gaping revenue deficit, warns Ettiene Retief, chairman of the national tax and South African Revenue Service (SARS) committee at the South African Institute of Professional Accountants (SAIPA).

Growing deficits 
Finance Minister Malusi Gigaba estimated a tax revenue deficit of almost R51bn in the 2017-’18 tax year during his maiden Medium-Term Budget Speech in October last year.

The deficit is set to increase to R69bn, or even greater, in the tax year that starts at the end of this month, however, this is without having regard to the additional income required to fund tertiary education for poor households. Former President Jacob Zuma made this surprise announcement at the end of last year.

Gigaba will present the budget on 21 February to Parliament.

More tax collections without higher rates 
Retief says taxpayers should expect adjustments to the current taxable income brackets which will increase tax collections without the need to increase the actual rates.

Last year the levels of all the taxable income brackets were increased by 1 percent and a new top personal income tax bracket of 45 percent for taxable incomes above R1.5 million per year was introduced.

Retief says it is “unlikely” that the top marginal rate will be increased any further. He refers to the “Laffer curve” which demonstrates that increasing taxes beyond a certain point is counterproductive, and revenue collection may even decline.
“An increase in the top marginal tax rate may result in increased efforts to evade tax by hiding income, or shifting income and wealth to other tax jurisdictions.”

Wealth and other taxes 
Retief is not convinced that the time is right for a wealth tax. South Africa already has taxes on wealth accumulation such as capital gains tax, estate duty and property levy when acquiring a property.

The maximum rate of 45% already impacts on the tax on trusts, and on capital gains. “People (who fall into the top tax rate) are not only taxed at a higher rate on the income they earn, but it also impacts the tax they pay on their capital gains when disposing of assets.”

This year will see the introduction of the much-debated sugar tax, but at a lower rate as previously proposed. The lower rate will not only yield lower revenue collections as originally estimated but could negatively affect the intended purpose of the sugar tax as international research has indicated that a high tax rate is required.

VAT – the elephant in the room 
Government has been warning that an increase is on the cards. “I would not be that surprised if it is increased,” says Retief. “The political environment is different from what it was just a few months ago. The economic climate has changed and growth prospects are slightly better, so perhaps it is now the time for an increase.” A one percentage point increase to 15% could raise R20bn.

The impact on the poor may be offset by the inclusion of more zero-rated items, or more targeted assistance for the poor. Previously it was announced that the zero-rating on fuel will be scrapped but was subject to consultation. It is unclear how much tax it could generate, given that businesses can claim back their VAT on fuel purchases.

If fuel was subject to standard rate VAT, domestic transport of passengers and luggage is exempt in terms of VAT, which means the owner of a taxi will not be able to claim back the VAT on fuel because of the scrapping of the VAT zero-rating. The cost will most probably be passed on to consumers.

Cryptocurrency 
The increase in popularity and use of cryptocurrencies (such as Bitcoin, Ethereum, Litecoin, Ripple, and IOTA) should be addressed, as the lack of regulation and disclosure could be used to evade taxes and circumvent exchange controls.

There is some uncertainty as to the correct taxing of gains and losses made with trading or holding cryptocurrencies. The South African Revenue Service (SARS) confirmed that it will clarify its position on the tax treatment of cryptocurrencies early in 2018.

Also, the South African Reserve Bank (SARB) issued a media statement on 13th February 2018 in regards to the establishment of the Financial Technology (FinTech) Programme with its first objective to review SARB’s position on cryptocurrencies to inform appropriate policy framework and regulatory regime.

SAIPA Budget Breakfast
SAIPA will be hosting its annual Budget Speech Breakfast on 22 February at the Royal Elephant Hotel and Conference Centre, in Centurion where a panel of expert speakers will discuss the impact of the President’s announcements. To book, please visit https://www.saipa.co.za/events-resources/

ENDS

For interviews with Ettiene Retief contact: Idéle Prinsloo, 082 573 9219, idele@thatpoint.co.za, www.atthatpoint.co.za
For more information on SAIPA please visit:

Website: www.saipa.co.za 
Twitter: @SAIPAcomms
LinkedIn: South African Institute of Professional Accountants Company 
Facebook: South African Institute of Professional Accountants
0 Comments

Trusts may no longer be the holy grail of estate planning

15/1/2018

0 Comments

 
Author: Ettiene Retief, Chairperson of National Tax and SARS committee of the South African Institute of Professional Accountants (SAIPA)
 
Trusts are often seen as the be all and end all of estate planning. However, the way in which our living situations, financial planning, tax and legal provisions have changed over the past few decades, means that trusts are no longer a good financial decision for many people.
 
A recent report by Sanlam investment plan, Glacier, found that the majority of South Africans who reach retirement haven’t made adequate provision for their retirement. Our financial planning problem is living, not dying. People see trusts as the silver-bullet of estate planning but the truth is that only a handful of people will truly benefit from setting up a trust.
 
Changing environment
The average household dynamic and life expectancy of a few decades ago is very different to the situation that we have today. In the past, the man of the household would often join a company for life and when he retired, he would receive a pension fund from the company. With a stay-at-home wife and a few kids, a husband would perhaps see it as a wise financial decision to set up a trust for his wife, who would probably outlive him by at least a decade or so.
 
In this case, protecting wealth made more sense, but people of today are living much longer and the money that they have saved has to go a lot further. Instead of considering your 20-year-old children who still need to study and start a family, many people live well into their 70s, 80s and even 90s. By the time they pass away, their children are often well into their 40s and able to support themselves.
 
Instead of being primarily focused on the amount of wealth that their children will inherit, the average middleclass person should be much more concerned with issues such as whether their wealth will be able to support them until they die. There are instances where people have accumulated an enormous amount of wealth over their lifetime and need to preserve it for future generations, but most people don’t have this problem.
 
If your estate is big enough, then you could still benefit from having a trust, but this only constitutes a small portion of the South African population. The reason why the rest of the people should think twice before establishing a trust is because with recent law changes the use of a trust may increase the tax liability.
 
Tax issues are either misguided or no longer relevant

A trust is taxed significantly more than an individual would be taxed. While there are options available to avoid being taxed heavily, this doesn’t necessarily solve the problem or give effect to the original estate plan.
 
The law in regards to estate duty and tax have changed significantly over the past decade, and some of the standard estate planning principals are no longer relevant. We no longer need the trust to secure the full benefits of the estate exclusions.
 
There is a cost to setting up and continuously administering the trust, as well as a cost to getting the assets into the trust. If the founder of the trust ends up using the value attributed to the trust for his/her retirement years, then the trust has little value in estate planning.
 
With the more recent tax law amendments that focus on the loans created to facilitate transferring the assets to the trust, there is an additional tax liability. Either the loan is interest free, or low interest, which results in a deemed donation each year; alternatively charging the required interest on the loan results in the increase in the loan value (effectively increasing the estate value) as well as increasing the founder’s taxable income with the interest earnings.
 
The current challenge most who have trusts setup to hold assets have, is how to get rid of the contra loan accounts.
 
It is important to note that a trust is not only used for tax planning purposes, as the trust could still be an effective way to protect your assets.
 
Retief concludes by saying that anyone considering setting up a trust, and individuals who currently have assets in a trust, need to be asking their financial advisors a few critical questions such as: is there really value in having a trust and should a restructuring of the trust be considered to derive more benefit from it.
 
Having a trust just because it’s something that made financial sense in the past doesn’t mean that it’s a good idea for you today. There are a lot of repercussions involved in setting up a trust, including the cost incurred to set it up and manage it. Understanding how big your estate is really going to be when you pass and how exactly you and your beneficiaries will benefit from the trust is your first step in the right direction. For the average citizen, however, focusing on a good retirement plan is much more important than being hell-bent on having a trust.

ENDS
 
MEDIA CONTACT: Idéle Prinsloo, 082 573 9219, idele@thatpoint.co.za, www.atthatpoint.co.za 
 
For more information on SAIPA please visit:
Website: www.saipa.co.za
Twitter: @SAIPAcomms
LinkedIn: South African institute of Professional Accountants Company
Facebook: South African Institute of Professional Accountants

0 Comments

Project Achiever Extended Programme fares well in November SAIPA Professional Evaluation Exam

13/12/2017

0 Comments

 
The South African Institute of Professional Accountants (SAIPA) recently announced its latest Project Achiever Extended Programme, which runs from 11 November 2017 to 28 April 2018. The initiative is designed to prepare candidates for the SAIPA Professional Evaluation exam, allowing them to become a Professional Accountant (SA).
 
The course builds on the success of the Institute’s original Project Achiever programme, but strives to make SAIPA’s professional designation accessible to a wider set of applicants. “We acknowledged that a large number of students study accounting through universities of technology,” reports Professor Rashied Small, Executive: Education and-, Training for SAIPA. “By opening up this opportunity to them, we can bolster the accounting ranks in South Africa.”
 
The Extended Programme improves on Project Achiever in a number of ways. The entry requirements for the latter included an NQF Level 7 degree, as well as three years of learnership or 6 years of work experience or completion of a training programme with another accredited professional accounting body. The new requirements remain the same except that candidates only need an NQF Level 6 diploma. However, they must pass an entry assessment to prove their ability to meet SAIPA’s high standard of competency.
 
The new programme is also longer, held over five months instead of three like its predecessor, and focuses more on soft skills development, like planning, time management, reading, critical thinking, reporting and analysis, in addition to the usual technical abilities.

Empowerment drive
Like Project Achiever, candidates of black African descent, or coloured African descent from the Western and Northern Cape regions only, are fully funded by FASSET (Finance and Accounting Services Sector Education and Training Authority). Other applicants may attend the course at a cost of R4000. Professor Small notes that SAIPA is the first professional body to offer such a programme in the Northern Cape, with 100 people from that area attending. “Of the 490 attendees, about 400 are fully funded, so it bodes well for our empowerment goals,” he says.
 
“We found that Extended Programme attendees fared far better in their Professional Evaluation exams than those who did not participate or even Project Achiever graduates,” observes Small. He attributes their success to the greater focus on soft skills and the longer time they had to develop them in combination with technical competencies.
 
Of the total number of 680 candidate who wrote the November 2017 Professional Evaluation assessment 561 were classified as being competent.  210 of the total number of candidates who wrote 201 were Project Achiever attendees with a pass rate of 83% and 250 were Extended Programme attendees with a pass rate of 90%. The pass rate for non-attendees was around 77%.

The top 10 scoring candidates comprised four from the Extended Programme and two from Project Achiever.
 
SAIPA’s Project Achiever Extended Programme was developed to make a career in accounting more accessible to a greater number of people while maintaining the quality and standards of the qualification and designation, and offer a better chance of passing the Professional Evaluation exam the first time. “And, thanks to our partnership with FASSET,” concludes Small, “SAIPA can contribute positively to the transformation agenda for the industry.”

November Professional Evaluation results

The November PE exam, which was written by 680 qualifying applicants, yielded 561 new professional accountants.
 
Two of the top 10 candidates were from the Project Achiever initiative and four from the Project Achiever Extended Programme.
 
The top ten candidates for this examination were:
Ranking            Name                                  Region

1                         Singh Ashrika                    Durban

2                         Snyman Riette                  Midrand

3                         Steyn Lente                       Bloemfontein

4                        Boshoff Christelle             Midrand

5                       Skosana Mehluli Qaba       Midrand

6                        Wayiza Nomakorinte         Durban

7                        Oleastro Maria                   Midrand

8                        Snyders Tracey-Lee            Upington

9                        Nieuwenhuizen Alana        Bloemfontein

10                      Bux Ridhwana                     Durban

 
ENDS
 
MEDIA CONTACT: Idéle Prinsloo, 082 573 9219, idele@thatpoint.co.za, www.atthatpoint.co.za 
 
For more information on SAIPA please visit:
Website: www.saipa.co.za
Twitter: @SAIPAcomms
LinkedIn: South African institute of Professional Accountants Company
Facebook: South African Institute of Professional Accountants
0 Comments

Trust is a must for professional accountants

20/11/2017

0 Comments

 
Picture

Author
: Bongani Coka, CE of the South African Institute of Professional Accountants (SAIPA)
 
A good reputation is hard to build, but can be destroyed overnight. This is particularly true of the accountancy and audit profession, which lives off its credibility. Distrust has recently become a major issue, especially with the recent public backlash experienced by politically implicated persons in the accounting profession.
 
Accountants need to keep in mind that establishing trust requires more than just honesty: it requires the ability to practice sound moral values. Major drivers of trust are openness, competence, benevolence and integrity.
 
Openness
The quality of ‘openness’ has a distinct ethical undertone as the disclosure of information can assist those who are affected by the information to either advance or protect their interests.
 
Failure to disclose such information effectively bars those affected by it from enhancing or protecting their interests. Consequently, a lack of openness on the side of a professional accountant will be perceived as unfair or unethical by their clients and other key stakeholders, which in turn will undermine public perceptions of the trustworthiness of the professionals.
 
Competence
Due to the recent spate of scandals, the South African public now question accountants’ ability to act in a manner consistent with the code of ethics for accountants and their competency to provide a quality service with the required skill.
 
A professional accountant may not mislead his employer or client as to his level of expertise or experience. Where appropriate, clients or employers must be notified of any limitations that the professional accountant may have.
 
In addition, Section 130 of the Code of Ethics for Professional Accountants requires a professional accountant to maintain professional knowledge and skill at a level required to ensure that a client or employer receives a competent professional service based on current developments in practice, legislation and techniques; and act diligently and in accordance with the applicable technical and professional standards.
 
Professional accountants are expected to employ an inquiring mind to their work founded on the basis of their knowledge of the organisations’ financials. Their training in accounting enables them to adopt a pragmatic and objective approach to solving issues. Using their skills and intimate understanding of the organisation and the environment in which it operates, professional accountants in business must ask challenging questions.
 
They are also the front runners when it comes to upholding the quality of financial reporting and providing the broader public with reliable financial information.  Regardless of the level of assurance, the public assume that due diligence was taken into account when the professional accountant compiled the financial statements.
 
Benevolence
Trust for a professional accountant’s client involves having confidence that they will act in their best interest or refrain from taking advantage of them. The possibility that they might break this confidence introduces the element of risk, with a dash of fear and anxiety peppered into the mix.
 
The greater the perceived risk, the harder it may be for the client to trust their accountant.
 
Any debacle in the accounting profession raises the question of ethical behaviour and shines the spotlight on the responsibility of the professional accountant to maintain the balance between serving the public interest and that of their client.
 
Professional Accounting Organisations (PAO) accredited by the International Federation of Accountants (IFAC) must be pro-active in their approach to any matter that may bring their institutes into disrepute as a result of the conduct of their members.
 
Random checks and balances must be conducted on PAO members to ensure that they remain in good standing and a PAO should encourage the public to lay a complaint for investigation should they experience misconduct or unprofessional behaviour from any PAO member.
 
Integrity
The link between integrity and ethics is so intimate that the two concepts are often used as synonyms.
 
In terms of section 110 of the Code of Ethics for Professional Accountants, obligation is imposed on all professional accountants to be straightforward and honest in all professional and business relationships. Integrity also implies fair dealings and truthfulness.

In conclusion, gaining clients and public trust by a professional accountant requires openness, having the competence and consideration of what clients say is important to them, and making sure they provide that to the satisfaction of a client in an ethical manner.

Trustworthiness is within our sphere of control, and consequently it is something that can be deliberately changed or cultivated. As a profession we are impacted by trust, let us try to restore it.
 
Photo caption: Bongani Coka
​

ENDS

MEDIA CONTACT: Idéle Prinsloo, 082 573 9219, idele@thatpoint.co.za, www.atthatpoint.co.za  
 
For more information on SAIPA please visit:
Website: www.saipa.co.za
Twitter: @SAIPAcomms
LinkedIn: South African institute of Professional Accountants Company
Facebook: South African Institute of Professional Accountants

0 Comments

SAIPA collaborates with other regulators to combat non-compliance

14/11/2017

0 Comments

 
Picture
Author: Ragiema Thokan-Mahomed. Legal, Ethics and Compliance Executive, South African Institute of Professional Accountants (SAIPA)
 
The 12th to 18th of November is International Fraud Awareness Week, an initiative established to educate the public on the threat of fraud and ways of combating it. It’s therefore a good time for professional accountants and business people alike to take pause and consider what role they can play in driving fraud from the market.

New NOCLAR standard
However, fraud is only one element of corruption. A bigger war is being waged against what has become known in the accounting industry as NOCLAR (Non-Compliance with Laws and Regulations). The threat is so real that the International Ethics Standards Board for Accountants (IESBA) created a new standard called Responding to Non-Compliance with Laws and Regulations to address the issue.
 
The standard, which became effective on 15 July 2017 and is the result of six years of labour, will be integrated into the organisation’s globally-recognised Handbook of the Code of Ethics for Professional Accountants. Several existing clauses in the Code have been amended to accommodate its provisions.

Memorandum of understanding
In light of such developments, the South African Institute of Professional Accountants (SAIPA), in collaboration with other regulating bodies for the accounting industry, is working to develop a memorandum of understanding to enable greater cooperation between these parties to fight NOCLAR. As one of the few internationally recognised professional accountancy organisations, SAIPA has taken the lead in pioneering a solution that will work for everyone.
 
While the final terms of the memorandum must still be established, several suggestions have been put forward. For example, member information of each body is and always will be protected as required by law and will never be shared between them. However, where members have been found guilty of gross misconduct related to NOCLAR or any deviant behaviour within their professional body, we look to acknowledge the recommendation of participating Institutes and act as guardians for the profession to keep unethical practitioners out.
 
This record will be available to other regulators, allowing them to determine if an applicant for their own designation is still in fact associated with that professional body. This would be an effective response in cases where, for instance, a discredited accountant attempts to carry on business under an alternative designation or uses a deceased practitioner’s membership number as their own.
 
It will also be important to investigate the principles and processes each body applies to combat corruption within its ranks. Where these are determined to be sound, consensus will be sought on how to make them universally applicable or to adapt them for the collective good.
 
SAIPA believes that cooperation and communication between regulators is the only way to provide robust defense against NOCLAR and promote the main goal of the Code of Ethics, which is always to protect the public interest. This interest extends to upstanding accountants who adhere to the principles of ethical conduct, organisations and individuals who administer their affairs honestly, and the reputation of the profession itself. It is in this spirit that the memorandum will be drawn up and made effective.

The accountant’s role
It’s also vital that professional accountants know and understand the Responding to Non-Compliance with Laws and Regulations standard, which was developed for three reasons. Firstly, it makes provision for disclosing potential NOCLAR to public authorities, where appropriate, without breaching client confidentiality.
 
Secondly, it arms the accountant with better alternatives than simply resigning from a matter without NOCLAR issues being resolved. Thirdly, it provides direct guidance on how to respond to potential NOCLAR in various contexts, allowing the practitioner to act with confidence when approaching these difficult situations.
 
While the standard was created to enhance ethical conduct, and offer protection to stakeholders and the general public, it also gives the professional accountant the freedom to play a significant role in the global fight against NOCLAR. It is therefore the duty of all practitioners to know what steps to follow and when to act if corruption is detected, and SAIPA encourages them to familiarise themselves with its requirements.
 
The concerted and cooperative efforts of the various professional bodies in South Africa and guidance provided by the new standard will provide a robust defence against NOCLAR. It is SAIPA’s vision that, by working together, we will hold the name of the profession high and continue to fulfil our obligation to the public good.
 
Photo caption: Ragiema Thokan-Mahomed

​ENDS

MEDIA CONTACT: Idéle Prinsloo, 082 573 9219, idele@thatpoint.co.za, www.atthatpoint.co.za 
 
For more information on SAIPA please visit:
Website: www.saipa.co.za
Twitter: @SAIPAcomms
LinkedIn: South African institute of Professional Accountants Company
Facebook: South African Institute of Professional Accountants

0 Comments

All eyes on the new Minister of Finance with his first mini-budget

23/10/2017

0 Comments

 
Author:  Ettiene Retief, Chairperson of National Tax and SARS Committee of the South African Institute of Professional Accountants
 
Finance Minister Malusi Gigaba will be delivering his inaugural Medium-Term Budget Policy Statement (MTBPS) on 25 October. His approach to the fiscal challenges facing the country will be vital to quell concerns about the economy, the perceptions of corruption and wasteful expenditure.
 
He must be able to convince international markets that all is under control.
 
Current economic climate
In February government expected the economy to grow by 1.3 per cent for this year and 2 per cent in 2018 as economic conditions strengthen. It raised taxes in order to fund existing spending programmes. The then minister of finance admitted that raising taxes when the economy is struggling is undesirable, but unavoidable in the current fiscal circumstances.
 
The economy contracted for two consecutive quarters and only came out the recession in the second quarter of 2017 when growth of 2.5% was recorded. However, if the first half of 2017 is compared with the first half of 2016, the growth rate was 1,1%, according to Statistics SA.
 
Since the February budget there has been negative economic indicators. Employment figures have gone down, with many more retrenchments in the pipeline that may translate into less Personal Income Tax collections. People are less inclined to shop when they are unemployed and lack cash-flow, which translates in less Value-Added Tax. Very few corporates are making huge profits, which may result in less Corporate Income Tax collections.
 
Projected tax income for the 2017-18 fiscal year is R1.41bn and the proposed expenditure R1.56bn. The minister will use his policy statement to indicate to which extend these figures will have to be adjusted. Government debt had been around 50.7% of Gross Domestic Product in February – which amounts to more than R2 trillion.
 
Expectations vs reality
Tax collections in all three the major tax types (Personal Income Tax, Value Added Tax and Corporate Income Tax) are expected to be lower than expected in February.
 
South Africans will need clarity on how Minister Gigaba is going to adjust his budget and whether he will be mindful of the additional cost of increased borrowings to make up for the anticipated tax collection shortfall.
 
They will also need assurance that government will keep expenditure in check, and even cut costs at non-performing entities. It is essential that SARS remains efficient and robust in its collection and administration of the tax base. However, there are concerns that there is slippage in tax compliance and that taxpayers can expect more aggressive treatment from the taxman.
 
The recently concluded Special Voluntary Disclosure Programme is expected to widen the tax base. The minister will most probably offer some clarity on the number of successful applications and the quantum of the previously undeclared assets that has been brought into the tax net.
 
Regaining taxpayer trust
The lack of accountability in terms of wasteful and fruitless expenditure continues to erode tax morality in South Africa.  In order to regain the trust of taxpayers they will have to be convinced that expenditure incurred by government is “reasonable”.
 
SARS is under pressure to collect tax revenues, with media reports suggesting that it may already not be able to meet target this year. The procedures followed by SARS to collect and administer the tax system must be seen to be reasonable. More aggression is likely to lead to more resistance from taxpayers.
 
It is understandable that government has certain obligations and that it has to fulfil its mandate in terms of efficient delivery of services such as health, safety and education.
However, when people continue to see reports of corruption and wastage without any accountability they tend to become more reluctant to part with hard earned money.
The minister has a difficult task on hand. He has to comfort all South Africans, the rating agencies and international markets that we are on the right track.
 
Purpose of the MTBPS
National Treasury states that the MTBPS is a government policy document that communicates to Parliament and the country the economic context in which the forthcoming budget (February 2018) will be presented.
 
It also sets out the fiscal policy objectives and spending priorities over the three-year expenditure period. The policy statement is an important part of South Africa’s open and accountable budget process.
 
The question stands wheter the minister will stay on the course set by the previous minister Gordhan, or will he present revised fiscal policy objectives and spending priorities going forward.
 
It offers the minister the opportunity to inform Parliament and the citizens of South Africa what progress has been made in terms of tax collections and whether the South African Revenue Service (SARS) is on track with collecting the amount that was budgeted for in February, and expectations of potential tax increases to come.

ENDS

MEDIA CONTACT: Idéle Prinsloo, 082 573 9219, idele@thatpoint.co.za, www.atthatpoint.co.za  
 
For more information on SAIPA please visit:
Website: www.saipa.co.za
Twitter: @SAIPAcomms
LinkedIn: South African institute of Professional Accountants Company
Facebook: South African Institute of Professional Accountants
0 Comments
<<Previous
    Welcome to the SAIPA newsroom. For releases prior to August 2014 please click here.

    Archives

    February 2021
    January 2021
    December 2020
    November 2020
    October 2020
    September 2020
    July 2020
    June 2020
    May 2020
    April 2020
    March 2020
    February 2020
    January 2020
    December 2019
    November 2019
    October 2019
    September 2019
    August 2019
    July 2019
    June 2019
    May 2019
    April 2019
    March 2019
    February 2019
    January 2019
    December 2018
    November 2018
    October 2018
    September 2018
    August 2018
    July 2018
    June 2018
    May 2018
    April 2018
    March 2018
    February 2018
    January 2018
    December 2017
    November 2017
    October 2017
    September 2017
    August 2017
    July 2017
    June 2017
    May 2017
    April 2017
    March 2017
    February 2017
    January 2017
    September 2016
    August 2016
    July 2016
    June 2016
    May 2016
    April 2016
    February 2016
    January 2016
    December 2015
    November 2015
    October 2015
    September 2015
    August 2015
    July 2015
    June 2015
    April 2015
    February 2015
    December 2014
    November 2014
    October 2014
    September 2014
    August 2014

    Categories

    All
    2014/15 Tax Filing Season
    2016 Tax Administration Laws Amendment Bill
    21 February 2018
    4IR
    Accountability
    Accountancy
    Accountants
    Accounting
    Accounting Ethics
    Accounting Institutions
    Accounting Integrity
    Accounting Standards
    Advice For Professional Accountants
    Africa
    Anti-corruption Pledge
    B-BBEEE
    Blockchain
    Bongani Coka
    Brian Purcell
    Bridging The Gap
    Budget 2015
    Budget 2016/17
    Budget Speech 2018
    Business
    Business Budget
    Business Rescue
    Cadre Formation
    Carbon Tax
    Careers
    CEO
    Code Of Ethics
    Companies Act
    Constitution
    Continuing Professional Development
    CPA Ireland
    CPD
    Cryptocurrencies
    Cryptocurrency
    Cyber Crime
    Cyber Security
    Cyril Ramaphosa
    Darren Gorton
    David Van Rooyen
    Davis Commission
    Debt
    Debt Intervention Bill
    Deloitte
    Department Of Basic Education
    Department Of Home Affairs
    Die Hoërskool DF Malan
    Different Types Of Accountants
    Doctoral
    Economic Climate
    Economic Development
    Economic Growth
    Economic Instability
    Economy
    Education
    Empowerment
    Environment
    Estate Planning
    Ethics
    Ettiene Retief
    Exxcellence
    Faith Ngwenya
    Female Entrepreneurs
    FICA
    FICA Bill
    Finance Minister
    Financial Intelligence Centre Act
    Financial Statements
    Fiscus
    Foreign Trade
    Fraud
    Georgina Barrick
    Global Economy
    Government
    Government Institutions
    Grade 11
    Grade 12
    Grant Thornton
    Health Issues
    Honours Degree
    HSBC
    IFAC
    Initial Coin Offerings
    International Business Report
    International Federation Of Accountants
    International Standard Of Review Engagements
    IRC Of SA
    Job Creation
    Job Losses
    Juane Cronje
    KPMG
    Kwa-Zulu Natal
    Large Business Centre
    LBC
    Learners
    Legal
    Malusi Gigaba
    Mandela Day
    Mark Kingon
    Marnus Broodryk
    Masters Degree
    Mathematics
    Medium-Term Budget Policy Statement
    Membership
    Mid-term Budget
    Mini Budget
    Moetapele Programme
    Momorandum Of Understanding
    Money Launderers
    Monitoring Females
    MTBPS
    NAO
    National Accounting Olympiad
    National Budget 2017
    National Consumer Tribunal
    National Credit Amendment Bill
    National Credit Regulator
    National Development Plan
    National Health
    National Imperatives
    National Tax Thesis
    NOCLAR
    Non-compliance
    Non-Compliance With Laws And Regulations
    Norton Rose Fullbright
    Obesity
    PAFA
    Pan African Federation Of Accountants
    Parilament
    Parliament
    Parliament’s Trade And Industry Committee
    Passenger Identity
    Paying Taxes Report 2018
    PE Exam
    Personal Details
    Personal Income Tax
    Pravin Gordhan
    Prem Govender
    Professional Accountants
    Professional Accountant (SA)
    Professional Accounting
    Professional Evaluation Exam
    Project Achiever
    Project Achiever Extended
    Protection Of Information
    Public Schools
    PWC
    Ragiema Thokan Mahomed
    Ragiema Thokan-Mahomed
    Rashied Small
    Repositioning
    Retirement Funding Reform
    SAIPA
    SAIPA Budget Breakfast
    SARS
    School
    School Learners
    Service Delivery
    Shahid Daniels
    Shahied Daniels
    Shirley Olsen
    Sibusiso Thungo
    Skills
    Skills Development
    Skills Retention Plan
    Skills Shortage
    SMEs
    South Africa
    South African Institute Of Professional Accountants
    South African Institute Of Professional Accountants
    South African Institute Of Tax Professionals
    South African Schools Act
    Struggling Economy
    Students
    Sugar Tax
    Sugary Drinks
    Sustainibility
    Tax
    Tax & Accounting Thesis Competition
    Tax Administration Act
    Tax Administration Laws Amendment Bill
    Taxation
    Tax Clearance Certificates
    Tax Compliance
    Tax Filing Season
    Tax Indaba 2016
    Tax Law
    Tax Ombud
    Tax Payers
    Tax Practitioner
    Tax Season
    Tax Thesis
    Tax Thesis Competition
    Technology
    Tertiary Education
    The Financial Intelligence Centre Amendment (FIC
    Thesis/dissertations
    The South African Institute Of Professional Accountants
    The South African Revenue Service
    The Tax Administration Act
    Thomas Hoeppli
    Tom Mojane
    Transformation
    Treasury
    Trust
    Trusts
    UCT
    Unemployment
    University Of Cape Town
    Value Added Tax
    VAT
    Wealth Taxes
    Winslyn
    Women
    Women Empowerment
    Women's Month
    Workplace
    World Bank
    Xenophobia
    Youth
    Zobuzwe Ngobese

    RSS Feed

CONTACT US

office [at] atthatpoint [dot] co [dot] za
© COPYRIGHT 2021
ALL RIGHTS RESERVED.

  • home
  • services
  • about us
  • our work
  • our thoughts