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Global Accounting Forum

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Global Accounting Forum is being launched to help the profession fight back against complacency and unethical practices — and to do so by encouraging accountants and their professional bodies to rebuild professional standards. We believe the accounting profession plays an essential role in the modern economy and that the highest standards of ethical behaviour must be observed in all branches of public accounting and corporate practice.

The accounting profession is in serious trouble all over the world today. While Big Four partner profit shares are exploding, accountants, accounting firms, CFOs and finance directors are under attack as never before — from the United States to Australia, from the UK and Ireland to South Africa, from India and China to the entire European Union.

Global Accounting Forum is a membership group for accountants in both public practice and industry who have a keen interest in the global profession and the maintenance of high standards in corporate reporting and all areas of professional accounting practice.

Membership deliverables include:

  • Global Accounting Bulletin, a newsletter published 20 times a year
  • Podcasts of interviews and roundtables on leading-edge professional issues
  • Daily news alerts

Join Global Accounting Forum today.

The industry drivers behind the launch of Global Accounting Forum

No matter where one looks across the globe, accounting and related scandals dominate the business news today. Most concern serious misbehaviour at large multinational corporations and accordingly have ramifications for the profession way beyond the country of origin. The fact that these are not usually reported in the media elsewhere means that accounting professionals are usually unaware of how much damage is being done to the profession — and their own firms — on a global scale.

Even more alarming, they do not even know their own partners! As such these firms are operating with business structures that are totally unsuited to their modern reality. They are giant corporations rather than partnerships. Furthermore, most partners in big accounting firms live in the belief that their colleagues in other countries are operating under the same professional and ethical standards as apply in their own offices — but the seemingly endless scandals that have plagued the profession deny this.

In reality the global accounting networks — Big Four and the rest — still manifest a large element of the individual national firms from which they were formed, some several decades ago.

Here are some examples of what has been happening:

  • In July 2018 US authorities ordered PWC to pay $625m damages over its role auditing Colonial Bank before its collapse in 2009
  • In South Africa, KPMG has been embroiled in a massive scandal involving former President Jacob Zuma and his henchmen, the Gupta family. The firm played an extraordinary role in forcing the resignation of a highly reputable finance minister and the destruction of the top echelons of the Revenue service. Hardly surprisingly, the firm's business has been decimated and a new management team has been brought in as part of a rescue effort.
  • In India, PWC has been hit with a 2-year audit ban by the securities regulator in the Satyam case
  • In the UK, there have been seemingly endless audit and accounting scandals over the past decade — not least involving major banks.
  • In one such scandal, in 2018 the UK's Financial Reporting Council fined BHS auditor PWC a record £6.5m and banned audit partner Steve Denison for 15 years as well as fining him £325,000. Denison took on the BHS audit in 2010 and signed off on its last accounts days before the store group was sold to former bankrupt Dominic Chappel. A year later BHS collapsed.
  • Almost nine of 10 Chinese companies encountered fraud cases in 2016, with many reported cases involving senior management, according to consulting firm Kroll's annual survey.
  • In Japan, after a highly publicised accounting scandal in 2015 at Toshiba Corp, half of Japanese companies have seen changes in the ways they are audited following an initiative from Prime Minister Shinzo Abe
  • Japan's financial regulator fined Ernst & Young 2.1 billion yen ($17.4 million) in 2016 after the firm's audit of Toshiba Corp's accounts failed to spot irregularities in the country's worst accounting scandal in years.
  • In Korea, the state audit agency uncovered a $1.3 billion "accounting hole" in 2016 at Daewoo Shipbuilding & Marine Engineering
  • In the United States there have a myriad of accounting scandals over the past 10 to 15 years involving companies like Enron, Cendant, WorldCom, Fannie Mae, HealthSouth, Tyco and Lehman Brothers
  • The Brazilian unit of accounting firm Deloitte paid $8 million in 2016 to settle civil charges that it issued and tried to cover up false audit reports, U.S. regulators said. The US Public Company Accounting Oversight Board (PCAOB) said the fine against Deloitte Touche Tohmatsu Auditores marked the largest civil penalty it has ever imposed, and that it has separately sanctioned 12 former partners and other officials for their role in the scheme. All but one of those 12 have been barred or suspended from working in the industry, the PCAOB said.
  • A Mexican homebuilding company, Desarrolladora Homex agreed in 2017 to settle accounting fraud charges with the US Securities and Exchange Commission after it allegedly falsified sales of over 100,000 homes to inflate revenue on its financial statements for three years in a row, claiming to have built homes for which satellite images showed not a trace.
  • In Canada, KPMG was slapped with a $6.2 million fine over audit errors at Miller Energy resources
  • In Germany, executives of the scandal-hit South African Steinhoff group are facing an accounting probe
  • In Ireland, David Drumm, a chartered accountant and former CEO of failed Anglo-Irish Bank was jailed for six years for conspiring to defraud depositors and investors and for false accounting
  • In country after country, senior accountants and finance executives working in large corporates have been charged, fined or jailed for serious corporate accounting abuses — including at Tesco and Autonomy in the UK — and Anglo-Irish in Ireland.

Loss of face on IFRS

Accountants have also lost face on the financial reporting standards-setting front. Nowhere has this been more evident than in the field of bank accounting, with IFRS (International Financial Reporting Standard) 9 — where the standard-setter was forced by all-powerful central bankers to do an about-turn on accounting for bad and doubtful debts. The central bankers, desperate for any and every means to improve the appearance of bank balance sheets insisted that banks must be required to provide for future losses at the balance sheet date. This is a breach of both fundamental accounting concepts and company law in countries such as the UK, which stipulates that companies can only provide for known losses in their balance sheets. The net result takes banks back close to where they were before the 1980s, when secret reserves and profit-smoothing was permitted — and bank executives found it very difficult to manage their banks. Unbelievably, banks are now allowed to understate profits in good times and understate losses in bad times.

Signals from Annual Reports

  • Important though they are, GAB will not confine itself to coverage of accounting scandals around the world. We will also benchmark the world's largest corporates for their sustainability — drawing particular attention to danger signals in their annual reports and financial statements.
  • For this we will use a combination of quantitative and qualitative criteria — including in our assessment vital factors such as culture, strategy, management experience, digital competence, and customer satisfaction.
  • Consulting, taxation and emerging lines of business
  • GAB will focus on the entire accounting firm — from accounting and audit activities to consulting, taxation and other lines of business:
  • On the consulting side we will rank firms by industry specialisation, emerging areas of competence such as AI, robotics and machine-learning. We will be particularly vigilant about conflicts of interest with audit work
  • With taxation, we will monitor changing trends in fields such as tax planning and the role of offshore centres as well as the perpetual battle between tax authorities and tax practitioners as to where to draw the line between avoidance and evasion.


Under the direction of Michael Lafferty, a chartered accountant, a Fellow of the Institute of Chartered Accountants in England and Wales and former banking and accounting correspondent of the Financial Times of London, the broader Lafferty Group has played a leadership role in international accounting journalism and publishing for several decades.

Michael Lafferty founded the newsletters International Accounting Bulletin and Management Consultant International as well as numerous banking and financial services titles.

In addition, Michael Lafferty has published several international studies of corporate accounting practices.
The decision to re-enter the field of accounting publishing has been taken by Michael Lafferty because of a belief that the broader accounting profession "needs an independent global forum to monitor professional developments worldwide. This is particularly the case because of the proliferation of corporate scandals we are now experiencing".

Lafferty Global Ltd. Company Number: 11442620.


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