INDONESIAS GOVERNMENT REGULATION CONCERNING PUBLIC ACCOUNTANTS

SYIFA AULIA AHMAD KAMIL

State University of Jakarta 2013

Bapepam LK Rule No. VIII A.1 & A.2

Ministry of Finance Decree No. 17/PMK.0 1/2008

Law No. 5 of 2011

LAW No. 5 of 2011

This law revokes Article 4 & 5 of Law No. 34 of 1954 on the use of Academic Title of Accountant Consists of 62 Articles which is devided into 16 Chapters.
LAW NO. 5 OF 2011

TYPE OF SERVICE
(Chapter II)

Assurance Service
Article 3, Clause (1)

Other than Assurance Service

Article 3, Clause (3)

Audit service on the information of historical financial Review service on the information of historical financial Other insurance service

Accounting Financial management

LAW NO. 5 OF 2011

LICENSING OF THE PUBLIC ACCOUNTANT

(Chapter III)

License to be the Public Accountant / Foreign Public Accountant is provided by the Minister Article 5, Clause (1) To obtain it, person shall meets 8 requirements Article6,Clause1(10 for Foreign Public Accountant) Article 7,Clause (2) It is valid for 5 years and can be renewed Article 5, Clause 2
LAW NO. 5 OF 2011

ESTABLISHMENT & MANAGEMENT OF KAP

(Chapter IV)

Form of Business of KAP

Civil Partnership / Firm
- 2/3 partners are ICPA
- 1/3 IC Non-PA partners - Foreign partners 1/5 of the overal partners

Article 12-15

Individual
- 1 person ICPA

Other business forms

- 2/3 partners are ICPA - 1/3 Non-PA partners - Foreign partner is 1/5 of the overal partners

- Ratio of Foreign Professional Employee to Local: 1/10 for each level of position

Business License of KAP and the Branch office of KAP are granted by the Minister Article18, clause 1 LAW NO. 5 OF 2011 It may be revoked and invalid Article21

RIGHTS & PROHIBITIONS FOR PUBLIC ACCOUNTANT (Chapter V)

Achiving honorarioum
have/become the partner of more than 1 KAP

PROHIBITONS

RIGHTS

Obtaining legal protection Obtaining data, information and other documents related to service
Article 24&30

Be concurrently as state officer, employee of government/state institution

Provide service for the same type of service on the same period which has been performed by other AP Receive/give commissions Commit/help to commit manipulation

LAW NO. 5 OF 2011

OBLIGATIONS OF PA & KAP

(Chapter V, Part 2)

Joining APAP

Article 25&27

Domicile in the territory of RI

Have 2 professional audit employees Have office/place implement Quality Control System

OBIGATIONS OF PA

OBLIGATIONS OF KAP&BRANCH

Maintain competence through sustainability professional training Well-behaved, honest, resposible and having high integrity

Assign foreign partner/employeen to arrange development program/education for free

Report business actvity, financial report to the Ministry no later than April

LAW NO. 5 OF 2011

ASSOCIATION OF THE PROFESSIONAL PUBLIC ACCOUNTANT (Chapter IX)

PA joined to APAP The Minister assigns only 1 APAP to implement the authority in accordance with the Laws APAP has authority to:
arrange and enact SPAP conduct CPA examination conduct sustainable professional education conduct quality revew for the members
LAW NO. 5 OF 2011

PROFESSIONAL PUBLIC ACCOUNTANT COMMITTEE (Chapter X)

The Minister forms KPAP
President of KPAP Vice-President Governments of KPAP
element APAPs element

KPAP assigns to provide consideration regarding on:

The policy on empowerment, founding, and supervision to the PA and KAP The arrangement of accounting standard and SPAP LAW NO. 5 OF 2011 Others matters related to PA profession

CRIMINAL PROVISION
(Chapter XIII) Article 55
Related to the service: Commit/help to commit manipulation, and faking the information Working paper (for purpose): manipulating/faking working paper Ommiting the record of working paper Doesnt make working paper

PA
Article 56

Associated Party Article 57, clause (2) Anyone

Article 57, clause(2), (3), (4)

Sentence: imprisonment no longer than 5yrs, & fine no more than Rp300mil
Sentence: Person: imprisonment no longer than 6 yrs & fine no ore Rp500mil Corporation: fine Rp1bilRp3bil

fake documents/statements/information related to the licensing of PA / KAP, including branch

Public Accountant Professions counterfeiter

Fake PA/KAP
LAW NO. 5 OF 2011

Minister of Finance Decree 17/PMK.01 /2008

Concerning Public Accountant Service

Minister of Finance Decree 17/PMK.01/2008

Attestation

Other attestation service

Management Taxation Consulting

Type of Services

Audit service on FS Review on FS Supervison on Prospective financial statement

Chapter II

Minister of Finance Decree 17/PMK.01/2008

 Minister of Finance represented by General Secretary authorize public accountant Public Accountant provide the services must have public accounting firm To be authorized Public Accountant, accountant must meet several requirement
Minister of Finance Decree 17/PMK.01/2008

Public Accountant

Chapter III

Public Accounting Firm

Public Accounting
Firm
Chapter IV

Proprietory

Partnership

Minister of Finance Decree 17/PMK.01/2008

Public Accounting Firm

Licensing of Public Accounting Firm

Chapter IV

Minister of Finance represented by General Secretary authorize public accounting firm

To establish public accounting firm, leader of PAF propose the authorization to general secretary
Minister of Finance Decree 17/PMK.01/2008

Foreign Public Accounting Firm

PAF could make agreement with Foreign Public Accounting Firm PAF using the name of Foreign Public Acounting Firm at office name, document, head of letter Authorization of using the name of FPAF is invalid when the licence of PAF is out of date.
Minister of Finance Decree 17/PMK.01/2008

Chapter V

Guidance and Supervision

Guidance

- PA is member of Association of Indonesia Public Accounting (IAPI) - PA must follow Pendidikan Profesional Berkelanjutan held by IAPI and PPAJP - PAF reporting annual report to general secretary: 1. Business Activity Report 2. Financial Statement of PAF - PAF and branch office lead by PA - PA is prohibited for being partner at more than 1 PAF
Minister of Finance Decree 17/PMK.01/2008

Chapter VI

Guidance and Supervision

General secretary conduct annualy supervision on PAF

Supervision

General Secretary could ask IAPIs opinion Information gathered by Secretary General must be concealed General Secretary reporting supervision to public accounting firm

Chapter VI

Minister of Finance Decree 17/PMK.01/2008

 The minister authorized to impose administrative penalty PAF due to violation of administrative provision Penalty apply since it is approved

Penalty

Chapter VII

Minister of Finance Decree 17/PMK.01/2008

Transitional Provision

Application for the license of Public Accountant, business license of KAP, and/or establishment license of KAP branch office of which is still in progress, should be re-applied in accordance with the provisions set in this Law KAPA or OAA whose name has been included collectively with the KAP should register within no longer than 1 (one) year since the enactment date of this Law.
Minister of Finance Decree 17/PMK.01/2008

Chapter VIII

Rule Number VIII.A.1

Registration of Accountant Engaging in Capital Market Activities

BAPEPAM-LK

Rule Number VIII.A.2

Independence of accountant Performing Services in Capital Market

 Public Accountant, who engages in Capital Market activities, shall be registered with BAPEPAM-LK and fulfill the requirements
This rule arranges procedures and detailed-requirements in order to enganges in Capital Market Activities

BAPEPAM-LK RULE NO. VIII.A.1

 In performing his/her professional services, especially in issuing opinion, an Accountant must maintain his/her independence. Public Accounting Firm must have quality control system that provides adequate assurance that the Public Accounting Firm or the Personnel maintain their independence, with respect to the size and practical nature of the Public Accounting Firm.

BAPEPAM-LK Rule Number VIII.A.2