Building trust, empowering our future-Upon assuming the position as Chairman and President of JICPA
I am Tetsuya Mogi newly appointed as Chairman and President of the Japanese Institute of Certified Public Accountants, or the JICPA.I would like to express my sincere gratitude for your continued understanding of and cooperation in the affairs of JICPA. We, certified public accountants, will faithfully live up to what society expects of us and our roles by delivering value through reliable auditing and ultimately contribute to the sustainable growth of society. Such expectations are seen in a series of recent moves, including the revision to the Certified Public Accountants Act which has recently passed the Diet. We will also endeavor to meet expectations for CPAs which have been soaring in the fields outside of auditing.
1. Contributing to society through creation and delivery of trust
In April this year, the JICPA set out a new tagline: "Building trust, empowering our future." Also, in the Vision Paper 2022 formulated in March, we are expressly committed to "Delivering a value of trust to society," which we believe is central to the roles of all CPAs. We, CPAs, will contribute to the sound development of the national economy and pave the way for a safe, vibrant, and affluent future by creating and delivering trust to society, from the standpoint of various positions including auditors, preparers, and outside officers. We will make these contributions based on the trust we have earned from society.
2. Sophisticating audit and other existing services and solidifying platform
The origin of trust in CPAs lies in the trust in auditing services from society, which constitutes one of infrastructure functions for capital markets. In recent years, the number of firms registered as listed company audit firms have exceeded 120, showing that the providers of auditing services to listed companies have been surging. As such, in order to maintain trust in auditing services from society, we need to strengthen our platform so that a wide range of auditors can actually provide audit services. To this end, we will sophisticate our audit services through digitalization and strengthen our operational platform through its globalization. In addition, we will improve the efficiency of audit services through digitalization and will broaden the sphere of our activities by shifting the limited resources of CPAs to areas such as the area where highly professional decisions are necessary and the area where human-to-human interactions are important.
3. Addressing growing expectations for CPAs
Recently, the fields of activities for CPAs have expanded significantly in line with the growing need for trust in society. As a consequence, CPAs who belong to audit firms now account for only 41.6% of all CPAs. This we believe suggests that the roles of and the sphere of activities for CPAs have been increasingly diverse. Under these circumstances, we will implement measures that help enhance the ability of CPAs so they can demonstrate their abilities in diverse areas and strengthen the network of CPAs to meet what society expects of them.
In non-financial information disclosure, which has attracted a great deal of attention recently, we will make proactive efforts to provide CPAs with opportunities to develop their expertise in climate change, human capital, and other new fields. We are providing these opportunities to CPAs, hoping that they can acquire the know-how that adds reliability to the information they have garnered through their experience in audit and assurance, and as a result, can exert leadership.
4. Securing human resources who can live up to society's expectations
More and more people have been attracted to the audit industry and CPAs today. As a result, the number of applicants/successful applicants has been increasing over the past few years. While the CPA industry is comparatively ahead of other industries in terms of gender and diversity, we will make further efforts to make our industry more attractive. However, the reality is a relatively large number of CPAs have taken a leave from their job as CPA due to reasons such as being busy. As such, we will provide CPAs with opportunities to raise awareness of their expected roles to create and deliver a value of trust to society and how challenging and rewarding their job is, while making industry-wide efforts to streamline audit services.
5. Promoting and raising awareness of accounting education
The revised Certified Public Accountants Act stipulates that the JICPA is responsible for taking on activities to promote and raise awareness of accounting education. The accounting way of thinking is essential to healthy social living. In fact, junior high schools and high schools are now teaching How to Use Accounting Information as part of their social studies classes. In the years ahead, we will be engaged in a broader range of activities to disseminate accounting literacy as an integral part of our social infrastructure, including the development of educational materials to support school teaching and the provision of related information to those involved in education including teachers.
6. Proactive collaboration with stakeholders
A collaboration with stakeholders is imperative to solve a variety of social challenges. We will push forward with constructive dialogues and collaborations with related organizations so we can address the challenges in cooperation with them. Specifically, to achieve the above, we will make industry-wide efforts, including building and tightening relations with these organizations as their trusted partners through proactive dialogues with them, hoping that CPAs live up to the expectations of and contribute further to society.
In the face of dramatic changes in social environment, the roles expected of CPAs in creating and delivering trust will further expand. We will do our best to meet such expectations and would greatly appreciate your continued guidance and support.