The IAASB Consultative Advisory Group (CAG) is an integral and important part of the IAASB's formal process of consultation. Representatives of CAG member organizations provide advice on numerous areas, including:
- The IAASB's agenda and project timetable (work program), including project priorities;
- Technical projects; and
- Other matters of relevance to the activities of the IAASB.
The CAG's objective and scope of activities, membership and composition, and operating procedures are set out in its Terms of Reference. The Public Interest Oversight Board (PIOB) oversees the work of the CAG.
James Dalkin is the CAG Chair. The roles and responsibilities of the CAG Chair are approved by the PIOB.
The Consultative Advisory Group (CAG) is an integral and important part of the IAASB's formal process of consultation. The following organizations comprise the membership of the CAG:
- Accountancy Europe
- Associação Brasileira de Instituições Financeiras de Desenvolvimento
- Basel Committee on Banking Supervision
- CFA Institute
- European Commission
- European Federation of Accountants and Auditors for SMEs
- Financial Executives Institutes International
- Information Systems Audit and Control Association
- Institute of Internal Auditors
- Inter-American Accounting Association
- International Accounting Standards Board
- International Actuarial Association
- International Association of Financial Executives Institutes
- International Association of Insurance Supervisors
- International Bar Association
- International Corporate Governance Network
- International Organization of Securities Commissions
- International Organization of Supreme Audit Institutions
- International Valuation Standards Council
- Islamic Financial Services Board
- Japan Securities Dealers Association
- National Association of State Boards of Accountancy
- Organisation for Economic Cooperation and Development
- Sri Lanka Accounting and Auditing Standards Monitoring Board
- World Bank
- World Federation of Exchanges
- Financial Services Agency, Japan
- International Monetary Fund
- US Public Company Accounting Oversight Board
Terms of Reference
Objective and Scope of Activities
1. The objective of the IAASB Consultative Advisory Group (the CAG) is to provide input to and assist the IAASB through consultation with the CAG member organizations (the Member Organizations) and their representatives (the Representatives) at the CAG meetings, in order to obtain:
a. Advice on the IAASB’s agenda and project timetable (work program), including project priorities;
b. Technical advice on projects; and
c. Advice on other matters of relevance to the activities of the IAASB.
2. The CAG Chair is an individual, elected by the CAG from amongst the Representatives, who shall perform the roles and assume the responsibilities from time to time specified by the CAG with the approval of the IAASB and the Public Interest Oversight Board (the PIOB).
3. The CAG Chair is expected to attend IAASB meetings as an observer, or to appoint a Representative to attend. The CAG Chair, or appointed representative, has the privilege of the floor at IAASB meetings.
4. The CAG Chair is entitled to attend meetings of the IAASB Steering Committee as an observer with privilege of the floor, or may appoint a Representative to attend with the same privilege.
Public Interest Oversight
5. The terms of reference of the CAG are approved by the PIOB. The PIOB also approves the CAG operating procedures for reappointing Member Organizations and for appointing or reappointing the CAG Chair. The PIOB may periodically review the terms of reference of the CAG and the aforementioned operating procedures.
6. The PIOB approves the appointment of the CAG Chair.
7. The CAG Membership Panel recommends the appointment of a proposed new Member Organization, and its nominated Representative(s), (see paragraph 13) to the PIOB for approval. The recommendation outlines the reasons why the CAG Membership Panel as described in paragraph 13 considers the proposed new Member Organization an important addition to the membership of the CAG. It also includes information about the nominated Representative(s). The PIOB has ongoing authority to identify any emerging public interest segments not already represented on the CAG and to bring these to the attention of the CAG Membership Panel for further consideration.
8. When an existing Member Organization changes its Representative (see paragraph 18), the CAG Membership Panel notifies the PIOB of the change and provides the PIOB with information about the new Representative.
9. The PIOB has the right to meet with any or all of the Representatives to discuss matters of interest to the PIOB. The CAG may bring to the attention of the PIOB matters which may be of interest to the PIOB. The PIOB also has the right to attend all meetings of the CAG, whether open, closed or private.1
10. Minutes of the open and closed sessions of the CAG meetings are sent to the PIOB. Minutes of the private sessions of the CAG meetings, the content of which reflects the private nature of the discussions held at such sessions, are also sent to the PIOB.
Composition and Membership
11. Apart from the Chair, the CAG comprises Member Organizations that are interested in the development and maintenance of high-quality international standards on quality control, audits, reviews, other assurance engagements and related services designed to serve the public interest. The membership should provide, to the extent practicable, a balance of geographical representation and between regulators, international organizations, users and preparers. Exceptionally, with the agreement of the CAG Chair, an individual might be appointed directly as a CAG member. The various rights and responsibilities ascribed to Member Organizations and their Representatives apply equally to such individual members.
12. Nominations may be submitted by individuals and organizations. The Basel Committee on Banking Supervision, the European Commission, the International Organization of Securities Commissions, the International Association of Insurance Supervisors and the World Bank are permanent Member Organizations. The Representatives nominated by Member Organizations should be knowledgeable about international standards on quality control, audits, reviews, other assurance engagements and related services, and related issues, and have a recognized interest therein.
13. A panel comprising the CAG Chair, two Representatives selected by the Chair for this purpose, the IAASB Chair and the IAASB Technical Director (the CAG Membership Panel) considers the nominations to determine whether the organizations, and their Representatives, are suitable for membership and to ensure a balanced geographical spread and functional backgrounds.
14. Each Member Organization is represented at the CAG meetings by either one or two Representatives. This limitation can be relaxed by the CAG Chair, in consultation with the CAG Membership Panel, only in exceptional circumstances.
Term of Office
15. The Member Organizations are appointed for a renewable term of three years.
16.The CAG Chair is appointed as Chair for a term of three years, renewable once.
17. Continuity of representation on the CAG is expected; however, Member Organizations, with the prior permission of the CAG Chair, may occasionally send other Representatives to a CAG meeting to be better able to contribute to discussions of the particular issues under review.
18. Where necessary, a Member Organization may replace an existing Representative by another Representative. The suitability of the proposed new Representative is considered by the CAG Membership Panel.
19. Representatives who do not attend, and Member Organizations that do not send their Representatives to, three consecutive meetings may be asked to stand down from the CAG.
20. To ensure that the CAG operates efficiently and effectively, the following specific operating procedures are adopted.
21. The CAG Chair assumes the chairmanship of any meeting of the CAG at which he or she is present. In the absence of the CAG Chair, the CAG Chair will nominate a representative to act as chair and, if no such deputy is appointed by the CAG Chair, the Representatives will appoint a deputy from amongst themselves. Such appointment of a deputy chair is valid only for the duration of the meeting in question.
22. Generally, two meetings are held each year; however, additional meetings may be convened at the discretion of the CAG Chair. The Representatives, and other meeting participants, are notified of meeting dates well in advance.
23. The IAASB Chair, Deputy Chair and Technical Director attend the CAG meetings, and IAASB staff provides administrative support for these meetings. All IAASB members have the right to attend and speak at the CAG meetings, and the CAG Chair invites selected IAASB members to lead discussions at the CAG meetings on IAASB projects for which they are responsible.
24. The CAG Chair may arrange a private session at a CAG meeting, to be attended by Representatives and members of the PIOB only.
Meeting Agenda and Papers
25. The CAG Chair, in appropriate consultation with the Representatives and the IAASB Chair and Technical Director, and with reference to the IAASB agenda and project timetable, sets the agenda for a CAG meeting.
26. A typical CAG meeting agenda includes discussions of:
a. Emerging issues or practices, potential new projects, and the IAASB’s project timetable, including project priorities;
b. Current IAASB projects at key stages of their development; and
c. Other matters of relevance to the activities of the IAASB identified by the Representatives.
27. Written materials supporting the CAG agenda items are ordinarily provided prior to each meeting, highlighting issues for consideration. If Representatives wish to take a proactive approach to issues to be discussed, then the relevant briefing papers will also be provided.
28. Materials that have not yet been made available to the public, for example through publication on the IAASB’s website, should not be provided to third parties or used as a basis for comment to the media. It is acknowledged that Representatives need to discuss the materials with the constituencies they represent; however, they are expected to put in place arrangements that enable the distribution of confidential material to be confined to a small group.
Travel and Accommodation Costs
29. Member Organizations meet the travel and accommodations costs of their Representatives.
30. The membership, terms of reference, including the operating procedures of the CAG, are published on the IFAC website. The membership and activities of the CAG are reported on in the IAASB’s annual report.
31. From 2006 the CAG meetings will be open to the public. When considered necessary, the CAG Chair will arrange closed sessions at which the public are not admitted to deal with administrative and similar matters.
32. Members of the public can access the agenda papers, including minutes, of the open sessions of the CAG meetings on the IFAC website. Minutes of the open and closed sessions of the CAG meetings are made available to the members of the IAASB. Should minutes of the private sessions of the CAG meetings be prepared, they will be sent to the Representatives.
 Open sessions of the CAG meetings are attended by the CAG Chair, Representatives of the CAG Member Organizations, member(s) of the PIOB, and relevant IAASB members and staff (including the IAASB Chair), and are open to other IAASB members and the public. The public is not allowed to attend closed sessions of the CAG meetings. Matters of a general administrative nature or with privacy implications may be dealt with in closed sessions of the CAG meeting. Matters discussed or to be discussed in an IAASB closed session that are also to be discussed with the CAG are discussed in the closed session of the CAG meeting. No decisions that would affect the content of CAG’s input to the Standards, Practice Statements and other pronouncements issued by the IAASB are made in the closed sessions of the CAG meetings. Private sessions of the CAG meetings are attended by the CAG Chair, Representatives of the CAG Member Organizations and member(s) of the PIOB only. The constraints on the topics of private sessions of the CAG meetings are the same as for the closed sessions of the CAG meetings.
Chair Roles & Responsibilities
The Chair is selected by Consultative Advisory Group (CAG) and approved by the Public Interest Oversight Board (PIOB). The Chair shall act in the public interest, and report to the PIOB. The role of the CAG Chair is especially important since the chair must achieve results while maintaining harmony in CAG discussions and following due process. The CAG Chair fulfills three interrelated roles:
CAG Spokesperson and Representative
The CAG Chair acts as the primary representative of the worldwide user group of the IAASB’s output, as comprised in the CAG. In this way the CAG Chair enables, encourages, and promotes a deeper understanding by IAASB of the public needs and expectations. In addition the Chair will:
- Actively promote the identity, objectives and activities of CAG in the media, public forums and other meetings with the PIOB, IFAC and IAASB stakeholders.
- Encourage and promote the convergence of national and international standards.
- Establish and develop effective relationships with identified key stakeholders.
- Represent the CAG in its annual report.
Leader of the CAG
The CAG Chair provides leadership to the CAG in the conduct of its activities. The Chair oversees the achievement of the CAG’s goals and objectives and will:
- Provide leadership in the achievement of the objective of the CAG as set out in its terms of reference.
- Actively identify and evaluate the impact of emerging issues bearing on the profession in order to provide advice to the IAASB.
- Govern the CAG meetings and ensure they are conducted properly. This responsibility includes, among others:
- Approving the agenda;
- Ensuring that the minutes are properly considered by the membership of the CAG and where necessary amended prior to distribution;
- Encouraging and promoting open, candid discussions and debate;
- Ensuring Member Organizations’ views are duly considered;
- Pro-actively leading debate on contentious matters being addressed by the CAG.
- Report, as appropriate, to the PIOB on IAASB progress and plans on a regular basis.
The CAG Chair is the key representative of the CAG and acts as the primary liaison with the PIOB, IFAC Board, and IAASB as well as identified key stakeholders, ensuring the views of all parties are appropriately represented and communicated. Thus the Chair will:
- Establish and develop effective relationships with key stakeholders, such as national standard setters, regulators, etc.
- Actively participate in meetings of the IAASB.
- Facilitate communication and liaison channels between the CAG and the PIOB, the IFAC Board and IAASB, ensuring that the views of the CAG are communicated to each body and that the views of each body are effectively communicated.
Criteria for CAG Chair
The following would represent criteria for selection of a CAG Chair:
- Integrity, objectivity and discipline.
- Commitment to the IAASB mission and the public interest.
- Effective leadership and strategic skills.
- Effective facilitation and communication skills and ability to listen and consider the views of others.
- Strong understanding of current and emerging issues.
- Effective public-speaking skills.
- Strong, established bonds with key constituents and stakeholders.
- Effective networking and relationship building skills.
- Effective negotiating skills.
- Consultative and judicious decision-making.
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