The Attorney General's June 20, 2006 approval of high new public accounting standards for Ontario is the culmination of a four-year process that began under the previous Ontario PC government. Below are some of the more significant milestones along the way.

October 30, 2002

The Eves government announces a review of public accounting licensing in Ontario, appointing Ronald Daniels, Dean of the Faculty of Law at the University of Toronto, to study the issue and make recommendations for both a new governance model and new standards of practice for public accounting.

November 26, 2002

The government tables Bill 213. The legislation states only that persons can have access to a public accounting license if they are members of one of the three accounting bodies, are of good character, and pass an unspecified examination. Additionally, no mention is made of standards adherence and standards enforcement requirements.

The Institute begins a protracted “standards before access” information and advocacy campaign to ensure that the necessary high, internationally recognized standards of qualification and regulation are clearly specified before public accounting licenses can be issued by other accounting bodies.

December 6, 2002

On a motion by the NDP, Bill 213 receives second and third reading and is passed by the Legislature. Nearly half of all MPPs are absent for the vote.

Also in December, the Institute publishes a letter from the U.S. National Association of State Boards of Accountancy (NASBA) as an open letter to Premier Eves in major Toronto newspapers. The letter warns against an erosion of public accounting standards in Ontario without major changes to Bill 213. Such a development, NASBA cautions, could also call into question the mutual recognition agreements enjoyed by both countries, founded on the equivalency between Canadian CA and U.S. CPA public accounting standards.

February 2003

Dean Daniels begins his consultations with the three accounting bodies while preparing his recommendations. In a discussion paper on how a new public accounting governance structure could work, he warns of the risk of “regulatory arbitrage”, which he says can arise “when regulatory organizations opt for less costly, more lenient and socially undesirable forms of regulation solely as a means of capturing increased market share for their members at the expense of members of competing, higher standard professional self-regulatory bodies.”

Also in February, Norm Sterling is appointed Attorney General, the Ministry responsible for public accounting regulation. Minister Sterling signals an immediate grasp of the need to delineate high public accounting standards before this issue can progress any further.

April 1, 2003

Dean Daniels tables his report. While making substantive recommendations for a new governance structure, the need for “sufficiency tests” to ensure the other accounting bodies can meet the required standards and measures to combat illegal practice, his report is all but silent on what the required standards themselves should be. Instead, he calls for the standards issue to be resolved by a new Public Accountants Council (PAC) made up of two representatives of each of the three accounting bodies. The Institute cautions that this could lead to a “negotiation” over standards between accounting bodies whose members are trained to different standards for different kinds of work – which would inevitably see them drift to a lowest common denominator.

June - August, 2003

During this period, Institute efforts to secure the necessary amendments to Bill 213 are slowed by widespread anticipation of a provincial election, and also by the SARS crisis and energy supply issues that come to dominate the agenda at Queen’s Park.

Still, the Institute continues its interventions with the government, arguing that the creation of entirely new public accounting standards for Ontario would be as costly and time-consuming as it would be redundant, given that such standards already exist : the current, internationally respected high standards that CAs are required to meet. Gradually, this position begins to gain traction among decision-makers at the Ontario Legislature.

September 2003

A provincial election is called. The leaders of both the Ontario PC Party and the Ontario Liberal Party sign public documents, submitted by the Institute, committing them to enshrining Ontario’s existing public accounting standard as the basis for licensure eligibility for the other accounting bodies under the new system. The Party Leaders also commit to a PAC comprised of four CAs, two CMAs and two CGAs.

June 9, 2004

After protracted consultations with the Institute, the McGuinty government and Attorney General Michael Bryant repeal the public accounting provisions of Bill 213, and replace them with a new Public Accounting Act, 2004 (Bill 94), which is passed in the Legislature with the consent of all three parties. However, the Act is not proclaimed into law pending the advent of a new PAC and the appointment of its membership, and the development of supporting regulations. Owing to the complexity of the issue, as well as the proliferation of other matters crowding the government agenda, this process would take more than a year to complete.

November 1, 2005

Having finalized public appointments to the new PAC, together with appointments from each of the three accounting bodies, the Public Accountants Act, 2004 (PA Act )is proclaimed.

January 2006

The reconstituted PAC begins its deliberations on a new qualifying and regulatory standard for public accounting licensing in Ontario. The PAC's efforts would be guided by Section 19(4) of the new PA Act , which specifies that the new standards must be no less rigorous than those in effect on June 9, 2004 (the day on which the legislation was tabled at Queen's Park). As the Institute was the sole public accounting qualifying body in Ontario as of that date, the clear intent of the legislation was to model the new standards on those high, internationally recognized standards that CAs were required to meet at that time.

April 20, 2006

The PAC completes its work on the proposed new standards in accordance with Section 19(4) of the PA Act . By an overwhelming margin of 13-2, the PAC votes to submit the proposed new standards to Attorney General Michael Bryant for his consideration. That vote consists of all independent public representatives to the PAC (excluding the Chair, who abstains), all CMA representatives and all CA representatives. Only the two CGA representatives stand opposed to the proposed new standards.

As prescribed under the Act , on receipt of the proposed new public accounting standards, Minister Bryant has 60 days (through to June 20) to review the news standards and accept the PAC's recommendation or refer them back to the PAC for any modifications he may deem to be required.

June 20, 2006

Following the conclusion of the review period, the Attorney General advises the PAC Chair and all three accounting bodies that he has no objection to the proposed new public accounting standards as submitted and that they are now in effect. Those standards are shown to be of equivalent rigour to the high CA standards that preceded them.

November 1, 2006

The PAC grants authorization to the Institute to license and govern the activities of its members as public accountants. The PAC's authorization follows a review of the Institute's qualification and regulatory standards which determines that the Institute meets the PAC's Standards adopted under the Public Accounting Act, 2004 .