cg and accounting profession iai acca
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Corporate Government and Accounting profession 2013, Ikatan Akuntan Indonesia, IAI, ACCATRANSCRIPT
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Corporate Governance of Large PLCs in Indonesia: Evidence based
on ASEAN CG Scorecard
IAI ACCA ConferenceFebruary 26 2013
Jakarta
Prof. Sidharta Utama, PhD CFAIAI
Indonesian Institute for Corporate Directorship
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ASEAN Corporate Governance ranking - Background
Objectives
Raise CG standards and practices of ASEAN Showcase and enhance visibility and investability of well-governed ASEAN PLCs Complement other ACMF initiatives and promote ASEAN as an asset class
Approach
ACMF: Create a universal CG Scorecard containing key elements of good CG Devise a scoring methodology Validate and publish ASEAN CG Scorecard Assess ASEAN PLCs identifying top 50 PLCs in each jurisdiction and top 50
PLCs regionally
Progress
ASEAN CG Scorecard released to public in March 2012 Assessment of 100 PLCs in 6 ASEAN Countries, July Oct 2012 Release of domestic top 50 PLCs in Feb 2013 Submit top 50 PLCs regionally to regulators in March 2013 Release of top 50 PLCs regionally in year 2015
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Raising CG Practices with ASEAN CG Scorecard
ASEAN CG Scorecard
Enhancing CG Rules/Standards
Improving Compliance with Rules/Standards
Encouraging Voluntary Adoption
of CG Practices
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ASEAN CG Scorecard
Globally Based
OECD CG Principles
Other International and Regional Standards
Regionally Developed
Six participating countries
Move beyond local rules/standards
Public Information
English Easily
Accessible
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5Level 1Has five major sections that corresponds to the OECD Principles
Part A: Right of Shareholders (26)Part B: Equitable Treatment (17)Part C: Role of Stakeholders (21)Part D: Disclosure & Transparency (42)Part E: Responsibilities of the Board (79)
Total no of items/ descriptors (185)
Level 2Two additional Sections
Bonus & Penalty
(11) Bonus items for companies that go beyond minimum standards
(23) Penalty items for companies with poor practices
Total bonus and penalty items (34)
There are two levels to the ASEAN CG Scorecard
STRUCTURE OF THE ASEAN CG SCORECARD
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Summary of CG Score Indonesia and ASEAN countries
0
10
20
30
40
50
60
70
80
90
100
Indonesia Malaysia, Singapore, Thailand
AverageMaximumMinimum
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CG Scorecard: Results for Indonesia
0
20
40
60
80
100
120
MaximumAverageMinimum
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Disclosure of Audit and Non-Audit Fees in Annual Report
0102030405060708090
100
D.5.1 D.5.2 D.5.3
YesNoN/A
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Question:D.5.1. Are audit fees disclosed?D.5.2. Are the non-audit fees disclosed?D.5.3. Does the non-audit fees exceed the audit fees?
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Timely Release of Audited Financial Report
0102030405060708090
100
D.7.1 D.7.2 D.7.3
YesNo
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QuestionD.7.1. Is the audited annual/financial report released within 120 days from the financial year end?D.7.2. Is the audited annual/financial report released within 90 days from the financial year end?D.7.3. Is the audited annual/financial report released within 60 days from the financial year end?
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Timely Release of Financial Report
87
70
24
96
10
27
73
1
D.7.1 D.7.2 D.7.3 D.7.4
YN
QuestionD.7.1. Is the audited annual/financial report released within 120 days from the financial year end?D.7.2. Is the audited annual/financial report released within 90 days from the financial year end?D.7.3. Is the audited annual/financial report released within 60 days from the financial year end?D.7.4. Is the true and fairness/fair representation of the annual financial statement/reports affirmed by the board of
directors/commissioners and/or the relevant officers of the company?
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Audit Committee93
82
74
4
15
23
E.19.4 E.19.5 E.19.6
YN
QuestionE.19.4. Does the company disclose the terms of reference/governance structure/charter of the Audit Committee?E.19.5. Does the Annual Report disclose the profile or qualifications of the Audit Committee members?E.19.6. Does at least one of the independent directors/commissioners of the committee have accounting
expertise (accounting qualification or experience)?
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Audit Committee89
7781
78
1916
90
E.19.7 E.19.8 E.19.9 E.19.10
YNN/A
QuestionE.19.7. Does the Annual Report disclose the number of Audit Committee meetings held?E.19.8. Did the Audit Committee meet at least four times during the year?E.19.9. Is the attendance of members at Audit Committee meetings disclosed?E.19.10. Does the Audit Committee have primary responsibility for recommendation on the
appointment, re-appointment and removal of the external auditor?
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THANK YOU
Corporate Governance of Large PLCs in Indonesia: Evidence based on ASEAN CG ScorecardSlide Number 2Raising CG Practices with ASEAN CG ScorecardASEAN CG ScorecardSlide Number 5Summary of CG Score Indonesia and ASEAN countriesCG Scorecard: Results for IndonesiaDisclosure of Audit and Non-Audit Fees in Annual ReportTimely Release of Audited Financial ReportTimely Release of Financial ReportAudit CommitteeAudit CommitteeTHANK YOU