Promise Kept as McGuinty Government Enacts New Public Accounting Standards

Move would enable CMAs, CGAs to practice alongside CAs if high standards met

TORONTO (June 21, 2006) - The Institute of Chartered Accountants of Ontario today commended Attorney General Michael Bryant and his Parliamentary Assistant, MPP David Zimmer (Willowdale), for ensuring the public interest remains protected while expanding access to the province's public accounting profession. The praise follows Minister Bryant's approval of high new public accounting standards that must be attained by members of Ontario's other accounting bodies (Certified Management Accountants, or CMAs, and Certified General Accountants, or CGAs) who seek to enter the audit and assurance market alongside Chartered Accountants.

"These high new standards were created by an arm's-length body consisting of a majority of independent, eminent public representatives and members of all three accounting bodies," noted Brian Hunt, FCA, President and CEO of the Institute. "They were then voted for submission to the Attorney General by an overwhelming 13 to two margin; a vote comprised of all the public representatives - except for the Chair, who abstained - and all CA and CMA representatives."

That vote, together with the Attorney General's approval of the new standards, Hunt said, was proof of broad agreement that the public interest must be put ahead of the commercial interests of any one accounting organization.

"By accepting these independent recommendations on public accounting standards for Ontario, the McGuinty government has achieved a fair balance by opening up public accounting to other designations while protecting the interests of investors and business community through the continuation of high professional standards," Hunt added.

Public accounting is the business of expressing independent assurance on financial statements and other financial information of enterprises of all sizes, to ensure that the information truly reflects the enterprises' financial condition. Large and small investors, financial institutions and other third parties then use that assurance to help them make informed investment and lending decisions.

In 2004, the government of Ontario set out to resolve the issue of who could be licensed for public accounting by passing the Public Accounting Act, 2004, which was supported by all parties in the Legislature. All three Ontario accounting bodies also supported this new Act, which fully satisfied the criteria needed to ensure that the public interest remained protected. It:

created a new Public Accountants Council (PAC) comprised of a majority of nine independent and highly qualified public representatives, four CAs, two CMAs and two CGAs;
mandated the PAC to create new public accounting qualification and regulatory standards that members of all accounting bodies would have to meet as a condition of licensing; and
specified that the new standards would have to be "no less rigorous than the internationally recognized standards under the (previous) Public Accountancy Act as they existed on June 9, 2004" - in short, the standards CAs were required to meet at the time.

The new PAC began developing proposed new standards in early 2006, and voted on the finalized package on April 20. On the basis of a 13-2 majority vote, the new standards were submitted to the Attorney General for his approval within a prescribed 60-day period that ended June 20, 2006.

Hunt stressed that the PAC's new standards continue to meet the needs of the international investment and business communities by requiring the continuation of:

rigorous education, examination and practical experience requirements;
the enforcement of exacting rules of professional conduct;
mandatory practice inspection and professional liability insurance programs for public accounting work;
continuing professional development requirements; and
comprehensive discipline mechanisms.

Hunt said the Institute of Chartered Accountants of Ontario's next priority is to help ensure that the PAC has the infrastructure necessary to enforce the new standards. "We intend to continue to work closely with the PAC and the McGuinty government to ensure that high public accounting standards remain a competitive advantage for Ontario."

About the Institute of Chartered Accountants of Ontario:
The Institute of Chartered Accountants of Ontario is the qualifying and regulatory body of Ontario's 32,000 CAs and 4,000 CA students. Since 1879, the Institute has protected the public interest through the CA profession's high standards of qualification and the enforcement of its rules of professional conduct. The Institute website is: www.icao.on.ca.

-30-

For more information please contact:

Perry Jensen
Director of Media Relations
[T] 416-969-4271
[F] 416-962-8900