Global News and Viewpoints

UK loses £11bn in a year to cyber crime

According to a study carried out by the anti-fraud groups – National Fraud Intelligence Bureau and Get Safe Online, British businesses and members of the public lost a combined £10.9 Billion pounds to fraud in 2015/2016. This equates to an average of £210 per person in UK. However Action Fraud and Get Safe Online warn that the actual figures are likely to be higher.

The participants who were polled in for the study and who had been a victim of online crime lost an average of £523. More than a third of the participants (38%) said that the matter was not significant to report, while another similar percentage (37%) said that there was nothing that could be done about it.

According to the research, 89% of those who polled in were concerned about online safety and security but a quarter said they had only a limited knowledge of the risks and how to protect themselves.

As many as 43% of respondents said that they use the same password for multiple online accounts and even when warned to change a password after a security breach 12% didn’t follow the advice. When it came to taking care of personal information, nearly a quarter (23%) said they never updated their privacy settings on social media, with 58% saying that they were not educated on the subject.

Tony Neate, chief executive of Get Safe Online, said: “The fact that the UK is losing nearly £11bn to cyber criminals is frightening and highlights the need for each and every one of us to make sure we are taking our online safety seriously.”

City of London Police commander Chris Greany, said, “The huge financial loss to cybercrime hides the often harrowing human stories that destroy lives and blights every community in the UK.

“All of us need to ask ourselves are we doing everything we can to protect ourselves from online criminals.”

EU-Canada summit: newly signed trade agreement sets high standards for global trade

On 30 October 2016 the President of the European Commission Jean-Claude Juncker, President of the European Council Donald Tusk, Prime Minister of Slovakia Robert Fico, and Canadian Prime

Minister Justin Trudeau signed the Comprehensive Economic and Trade Agreement between the EU and Canada (CETA).

The deal will benefit exporters, big and small, creating opportunities for European and Canadian companies and their employees, as well as for consumers. Almost all – 99 percent – of import duties will be eliminated, saving European exporters of industrial goods and agricultural products more than

€500 million a year. As the EU’s most advanced and progressive trade agreement to date, CETA is a landmark accord that sets the benchmark for future agreements. It includes the most ambitious chapters on sustainable development, labour and the environment ever agreed upon in bilateral trade agreements. CETA will not solely help boost trade and economic activity, but also promote and protect shared values.

CETA will also end limitations in access to public procurement, making it possible for EU firms to bid for public contracts – at the federal level as well as in Canada’s provinces, regions and cities. CETA will open up the services market, making it easier for professionals such as engineers, accountants and architects to work in Canada. Canada also recognises the special status of the EU’s Geographical Indications, agreeing to protect a list of more than 140 European goods in Canada, such as Prosciutto di Parma and Schwarzwälder Schinken. A range of goods will have fewer administrative hurdles to jump, avoiding double-testing on both sides of the Atlantic, benefitting smaller companies in particular.

There is clear proof that free trade agreements spur European growth and jobs. As an example, EU exports to South Korea have increased by more than 55% since the EU-Korea trade deal entered into force in 2011. Exports of certain agricultural products increased by 70%, and EU car sales in South

Korea tripled, over this five-year period. The Korea agreement was provisionally applied during its ratification process.

On average, each additional €1 billion of exports supports 15.000 jobs in the EU. 31 million jobs in Europe depend on exports.

Mandatory Audit Firm Rotation—Are We Going ‘Round in Circles?

Fayez Choudhury

This article originally appeared on 18 October 2016 on the IFAC Global Knowledge Gateway: by Fayez Choudhury, Chief Executive Officer

Last week, the South African Independent Regulatory Board for Auditors (IRBA) announced a timeline for new mandatory audit firm rotation requirements—a policy requiring companies to switch auditors periodically. In the same week, the Monetary Authority of Singapore (MAS) announced its intention to discontinue the very same policy. IFAC recently convened roundtables of international business leaders and regulatory agencies on smart regulation, and this contrast is a prime example of two principles the participants urged policymakers and regulators to observe: start with clear objectives, and assemble a clear evidence base.

IRBA has proposed the measures to “strengthen auditor independence and enhance investor protection,” also suggesting “we will only see true empowerment when opportunities are provided equally among everyone.” MAS found “research studies conducted thus far internationally did not provide conclusive evidence linking mandatory firm rotation with an improvement in audit quality,” and “from MAS’s observations and feedback received from stakeholders, MAS recognizes that there are also negative consequences associated with frequent rotation of external auditors.”

Business leaders and regulators at IFAC’s recent roundtables suggested that getting regulation right is not just about the answer, but it is all about starting with the right question. Being clear from the outset on what the regulation is trying to achieve is essential. In the case of mandatory audit firm rotation, is it trying to address audit quality and investor protection? Is it about competition and an effective market for audit services? Or is it about economic empowerment? These are all important priorities, and they all demand their own focus to find the approach most likely to yield the desired result.

Many other countries are at various phases of implementing or discontinuing mandatory audit firm rotation, with similarly diverse objectives. South Korea, Argentina, and Brazil have implemented and discontinued the policy for certain sectors; the EU is now implementing with numerous variations across Member States—some of which, such as Spain and Italy, had previously implemented and discontinued the policy; and the US House of Representatives in 2013 voted 321-62 to prohibit the Public Company Accounting Oversight Board from requiring mandatory audit firm rotation.

The list goes on. In the meantime, for global businesses trying to coordinate their audits worldwide, the complexity, costs, and risks of trying to navigate this patchwork regulatory environment detracts from their focus on obtaining the highest quality audit—possibly even going so far as necessitating multiple auditors in different jurisdictions to meet different rotation requirements.

IFAC roundtable participants in Hong Kong and London also stressed that research and a clear evidence basis are vital to identify solutions most likely to be effective. This is all the more critical in light of the costs of regulation to businesses trying to operate in a global environment, and possible unforeseen consequences. However, all too often, it seems to be the solutions looking for the problems, rather than the other way around.

Visit the IFAC Global Knowledge Gateway: to find additional content on a variety of topics related to the accountancy profession.

Copyright October 2016 by the International Federation of Accountants (IFAC). All rights reserved. Used with permission of IFAC. Contact [email protected] for permission to reproduce, store, or transmit this document.

Calling All SMPs! Take the 2016 IFAC Global SMP Survey

As service providers to small- and medium-sized entities (SMEs), commonly known as the “engine rooms” of the global economy, small- and medium-sized practices (SMPs) are critical. To ensure our nation’s voice is heard in the global SMP discussion, we encourage SMPs to take this 10-minute survey from the International Federation of Accountants (IFAC). The Malta Institute of Accountants is a member of IFAC, which represents the global accountancy profession.

Open from October 1 until November 30, 2016, at, the annual survey is intended to take a snapshot of key issues, and track important trends and developments, facing the SMP/SME sector. In 2015, your response contributed to over 6,700 responses, the survey’s largest response yet (see 2015 summary and report).

Responses will contribute to global insights for the profession, which will help us and IFAC better direct resources to support SMPs and their clients. For the results, subscribe to SMP news. See the previous survey results on the IFAC website at


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