2016 - October
ISCA and LCPAA Sign MOU to Develop Accountancy Sector in Laos
25 Oct 2016 Category: Media Releases
25 October 2016 – The Institute of Singapore Chartered Accountants (ISCA) and the Lao Chamber of Professional Accountants and Auditors (LCPAA) have signed a Memorandum of Understanding (MOU) to explore opportunities for ISCA and Laos to co-develop the accountancy profession in Laos through capability building programmes. This includes areas such as the training of accounting technicians, continuous professional development and exchange of expertise, experiences and best practices between the accountancy firms of Singapore and Laos.
The MOU was signed yesterday (24 October) by ISCA President Mr Gerard Ee, and Dr Phirany Phissamay, President of LCPAA, and Deputy Director-General of Accounting Department of the Ministry of Finance of Laos in Vientiane, Laos.
“As the national accountancy body of Singapore, we are privileged to contribute our expertise and experience towards the development of the accountancy sector in Laos. This collaboration also provides opportunities for Small and Medium Practices (SMPs) in Singapore to explore collaborative opportunities with accountancy firms in Laos,” said Mr Gerard Ee.
“'With the cooperation between ISCA - an established professional accountancy body, and LCPAA - a young professional accountancy body, in terms of sharing experiences and best practices, it would help Lao accountants to accelerate their acquisition of up-to-date professional knowledge and skills for the development of the accounting profession in Laos and ASEAN,” said Dr Phirany Phissamay.
Lao Economy and Accountancy Sector
Since the Lao government’s efforts to decentralise control and encourage private enterprises in 1986, the economy of Laos has been rapidly growing. As of 2015, the Gross Domestic Product of Laos has grown at a rate of seven percent. To sustain its growth rate, the country is continuously developing its economic infrastructure. The accountancy profession of Laos also plays a vital role in building strong capital markets and fostering investor confidence.
Currently, there is a shortage of accountancy-trained professionals to support the growing Lao economy. Moreover, while the Lao government has mandated the adoption of the International Financial Reporting Standards (IFRS) to prepare and maintain their financial records, majority of the accountants in Laos do not possess the necessary knowledge to do so as most are familiar with rules-based accounting and have little or no knowledge of principles-based accounting, which is the bedrock of IFRS. This knowledge gap further impedes the progress of Laos towards full adoption of IFRS for public interest entities, and Lao Financial Reporting Standards (adopted from IFRS for SMEs) for non-public interest entities, particularly for SMEs.
Under the ASEAN Economic Community (AEC) Blueprint 2025, ASEAN will provide new emphasis on the development and promotion of micro, small and medium enterprises (MSMEs), the engine that powers the region, in its economic integration efforts. With this, 30 Lao senior government officials, in batches of 15, will be attending a five-day leadership programme in Singapore covering areas such as on principles of accounting, tax mechanism and public sector financial management. To enable Laos to implement the best practices learnt, 25 local government officials in Laos will be trained as specialists in the inaugural run. Each run will comprise three modules covering principles of accounting, tax mechanism and public sector financial management.
To gain traction and achieve a multiplier effect, Lao officials who have completed the ISCA training will train fellow peers. The Train-the-Trainer model aims to help Lao government and businesses transit from rules-based accounting that was set up for tax purpose to principles-based accounting for financial reporting purpose. This will help build the foundation for Laos to eventually adopt the international accounting standards in Laos which is premised on principles based accounting.
Exchange of Expertise
Laos and Singapore can also look forward to more new business opportunities as efforts have been made to help small and medium practices (SMPs) from both sides to interact and build professional networks. With the AEC promoting free flow of trade, services, investment, capital, and skilled labour, this will help to create more economic opportunities for SMPs of both countries.
Note to Editors:
Under rules-based accounting, a list of detailed rules is set up to be followed when preparing financial statements. For example, depreciation rate for each asset is determined based on the estimated useful life of the asset to facilitate tax calculation.
Under principles based accounting, accountants will apply a set of principles in accounting for transactions. This would require judgement depending on the facts of the situation, which require more judgement from accountants
For media queries, please contact:
Shaun Tay, Communications Executive, ISCA
Tel: 6597 5613 /9147 7633
Betsy Tan, Senior Communications Manager, ISCA
Tel: 6597 5608/ 9641 6920
Mookda Liangsakoun, Administrative Manager, LCPAA
Tel: +856 30 5033 187
About the Institute of Singapore Chartered Accountants
The Institute of Singapore Chartered Accountants (ISCA) is the national accountancy body of Singapore. ISCA’s vision is to be a globally recognised professional accountancy body, bringing value to our members, the profession and wider community. There are over 30,000 ISCA members making their stride in businesses across industries in Singapore and around the world.
Established in 1963, ISCA is an advocate of the interests of the profession. Possessing a Global Mindset, with Asian Insights, ISCA leverages its regional expertise, knowledge, and networks with diverse stakeholders to contribute towards Singapore’s transformation into a global accountancy hub.
ISCA is the Administrator of the Singapore QP and the Designated Entity to confer the Chartered Accountant of Singapore - CA (Singapore) - designation.
ISCA is an Associate of Chartered Accountants Worldwide – supporting, developing and promoting over 620,000 Chartered Accountants in more than 200 countries around the world.
For more information, visit www.isca.org.sg.
About the Lao Chamber of Professional Accountants and Auditors (LCPAA)
Lao Chamber of Professional Accountants and Auditors (LCPAA), formerly known as Lao Institute of Certified Public Accountants before 7 April 2015, is the National organization of Accountancy in Lao PDR. It was established in 1998 by the Ministry of Finance on 5 May 1998.
The principal activities of LCPAA are processing its membership and providing training and professional development for its members.
Refer to Note to Editors