|
President’s Message 2007
President’s Message 2007
The Year of Professionalism!
This year the Institute completed its tenth year of providing service to the management accounting profession. This period saw the professionalisation of the services provided by the secretariat, mainly via:
· The appointment of a Full-Time Paid Executive Director, Mr. Chintan Bharwada, BCom, MBA, CMA
· A fully revamped website in keeping with the enhanced international profile of ICMA
· Launching of New Corporate Brochure
· Launching of the Redesigned On Target Newsletter
· Provision of the CFO Magazine (replacing Strategic Finance which was surveyed as being irrelevant to the Asia-Pacific region)
· The installation of the Customer Relationship Management (CRM) system to handle the membership, invoicing, examinations and accounts
· The registration of our Logo as a Trade-Mark in Australia.
· The updating of the syllabus of the CMA program and the development of 2 Course Modules in the new subjects of Strategic Cost Management and Strategic Business Analysis
· Links to CEO Institute for Members
· Special offers for Insurance, TIME magazine subscriptions for members
· Sponsoring the Public Sector Accounting symposium in Queensland and the CMA Summit in the Philippines.
All of this was in addition to the strong achievements over the previous 10-years such as:
· Developing an internationally recognized post nominal, the CMA
· Maintaining a degree qualified membership (most at Master level)
· Developing a postgraduate professional development program
· Worldwide distribution network of our education program, including India, Indonesia, Lebanon, Malaysia, Singapore, Papua New Guinea, Philippines, Sri Lanka, Canada and the European Union.
· Forming new alliances in Bandung – Indonesia, Dubai, China and Hong Kong.
CMA House has been fully operational now for 3-years, and most secretarial matters now handled at this address. Within this, the ICMA houses its Reference Library, in which one of the most comprehensive collections of management accounting books and journals in Australia. Members are welcome to use its reference library, by appointment.
Our web page, www.cmawebline.org was completely updated this year, and attracts significant interest from around the world especially its Newsletter, On Target, which obtained a full-colour look this year; and the online journal, The Journal of Applied Management Accounting Research (JAMAR). JAMAR continues to attract research publications from many parts of the world, and is now listed on the ProQuest and Cabell databases. The journal is available in both print and electronic form, and members are encouraged to submit papers that will be then appropriately refereed to ensure that adequate academic and professional standards are maintained I wish to thank the Editors and the international panel of referees for their work in assisting us to create this excellent resource that has become an important tool in our public profile.
Membership continues to grow healthily both in Australia and overseas, now mainly due to our Education programs. It is always difficult picking exact numbers at this initial point in the financial year because of the uncertainty surrounding renewals. It would appear, however, that our current membership is now over 1,450 CMA, AMA and GMA members, and approximately 1,100 MAA affiliates. The overall growth rate was 20.1%.
One of the foremost issues always confronting the executive is the need to continue raising the public profile of the Institute. The Executive has now focused on a theme of 5-Star ReportingTM, incorporating the following aspects of corporate reporting:
· Economic
· Environmental
· Social
· Governance, and
· Empowerment
The Institute is currently in the process of setting up a research body to actively promote this area called the “Institute for the Advancement of Corporate Reporting and Assurance”. The new institute will actively lobbying Government appointed Regulatory Bodies to legislate as mandatory (or at least recommended as best-practice) the various audits required to ensure the veracity of such reports, via Strategic Audits, Cost Audits, Environmental Impact Audits and Risk Audits.
Your Executive committee continued to grapple this year with issues of particular relevance to 'generalist' accounting bodies, and considered its relevance for a specialist management accounting body. One issue was if to obtain Australian Government recognition for migration purposes. Currently the generalist accounting bodies in Australia have this recognition. Some members of your executive were in favour of seeking this recognition as they felt it would enhance the profile of the Institute, whilst others opposed it claiming that the ICMA was set up as a specialist postgraduate body set up to further the cause of management accounting and not as a migration body for accounting seeking employment in Australia. Discussions on this issue are heated and continuing. The second issue is if ICMA should seek IFAC membership. Preliminary discussions with IFAC have highlighted two concerns. First, IFAC appears to deal mostly with financial accounting issues (such as IFRS) and has paid only 'lip-service' to date on management accounting issues. Second, IFAC charges a differential membership rate depending on the country of origin and its economic standing. As the ICMA is an Australian body, the membership fees of IFAC when averaged over the ICMA's exclusive but small membership base, would add another A$50 to the membership fees just to support its IFAC membership. Again, the Executive committee is divided on the cost-benefit of IFAC membership.
The ICMA has joined as a founder and sponsoring member of IMACTM (the International Management Accounting CollaborativeTM) a senior academic research collaboration spanning many countries. Preliminary informal discussions have taken place on the IMACTM concept with CMA (Canada); ICWA (India) and CIMA (UK). The ICMA is also actively lobbying Government appointed Regulatory Bodies to legislate as mandatory (or at least recommended as best-practice) the various audits required to ensure the veracity of such reports, via Strategic Audits, Cost Audits, Environmental Impact Audits and Risk Audits. A discussion paper is currently being written on the objectives of IMACTM.
The Global Business School initiative in which CMA subjects are incorporated within MBA programs of the Royal Roads University (Canada), Educatis University (Switzerland), Jubilee University (PNG) and the Indonesian Institute of Management is now offered both online and via face-to-face teaching modes. The MBA and CMA programs are now offered both via online and face-to-face teaching modes
See www.witsgbs.com
From 2008 the format will change as the contracts with Royal Roads University (Canada) and Educatis University (Switzerland) expire, and will not be renewed. The ICMA is currently considering applying for registration as a Private Provider as an Australia University.
Once more I must express my deep gratitude to a hard working executive and council. It is unfair to single out individuals but I am sure my colleagues will agree that the input of our Education and Membership Committee Chairmen, and our Treasurer, has been remarkable and well beyond the call of duty. I would also like to thank our Executive Director Mr. Chintan Bharwada; our Secretary John Ortner, Sandy Stewart, our Newsletter Editor, Bill Richardson our Bookshelf and Book Review Editor and Dr Themin Suwardy, our webmaster, for their dedication and professionalism brought to the tasks entrusted to them.
Finally a vote of thanks to our auditor Ben Kaplan who has once again given his time to discharge his duties very professionally.
Leon Duval
President
The Role of Carbon Trading in Regulating the Greenhouse Effect
In the last issue of On Target, we discussed the international responses to reducing Global Warming, i.e. Joint Implementation (JI); Clean Development Mechanism (CDM) and International Emission Trading (IET). In all these three mechanisms (especially the latter two), the concept of a 'carbon credit' as a measurable and tradable instrument that is acceptable across nations is required. As per the Kyoto protocol, each carbon credit represents one metric tonne of CO2 either removed from the atmosphere or saved from being emitted.
Theoretically, a carbon credit need not have a monetary value, and instead can be 'bartered' across nations. The problem is that these 'carbon credits' are not issued by a single international Emissions Trading Authority (at least not yet). Instead, different countries (and different State authorities within those countries) issue these carbon credits (or permits) based on a monetary price.
Many countries are considering 'managing' their CO2 targets through the regulation of business entities and individuals in their own countries in three principle ways:
· By taxation. Here the government imposes a straight tax on CO2 emissions. The advantage of this is that it is immediately implementable, transparent and similar tax regimes could be harmonised around the globe perhaps under the oversight of the International Monetary Fund. The disadvantage is that business may absorb or pass on the tax to consumers, and not cut emissions.
· By allocating carbon credits or 'permits' to these entities or individuals for the emission of a certain quantity of greenhouse gases in a particular period (i.e. a permitted quota). These permits may be given away free, sold at a predetermined price or auctioned. This is a carbon emission 'rationing' or (cap and trade) system.
· By approving certain organisations as being able to issue legitimate carbon credits (called 'abatement certificates') by undertaking work to either increase the capacity of sinks, or reduce CO2 emissions from sources. Known as a cap and trade system, greenhouse performance levels are set whereby those that can deliver a particular product with emissions below the benchmark can earn (create) abatement credit certificates.
Carbon credits thus create a market for reducing greenhouse emissions by giving a monetary value to the cost of polluting the air. This means that carbon becomes a cost of business and is seen like other inputs such as raw materials or labour. There are significant strategic implications in how companies incorporate such costs (and potential revenue streams) into its pricing and related marketing decisions.
As emission levels are predicted to keep rising over time, it is envisaged that the number of companies wanting/needing to buy more credits will increase; hence pushing the market price up, and thus encouraging more groups to undertake environmentally friendly activities which create for them carbon credits to sell.
Whilst high CO2 emitting entities will have an extra cost of running their businesses, there could be money for others who do not, at present, consider CO2 as a separate line of business.
A cap-and-trade system should ideally be based on free-market principles whereby those best placed to reduce their emissions can reduce emissions for those less well placed and then sell these reductions.
One of the earliest such trading schemes is the European Union Emission Trading Scheme (EU ETS) which is the world's largest multi-country cap and trade system. The EU has established a cap that limits emissions for its member states, each of which has been given a specific number of credits. The total amount of credits cannot exceed the cap, limiting total emissions to that level.
The EU ETS is only open to countries that have signed the Kyoto Protocol. Japan has a voluntary scheme. Having also not signed the Kyoto Protocol, the US has no formal carbon emissions trading market, although two regional emissions trading zones have developed, in the East and West Coast. Many companies from overseas countries have joined the Chicago Climate Exchange. Despite also not having signed the Kyoto Protocol, Australia had the first operating carbon emissions trading scheme in the world, the NSW Greenhouse Gas Abatement Scheme, which began operating in January 2003. Participants can trade 'carbon offsets' among themselves or with outside parties such as banks.
If a carbon emission trading (monetised or bartered) becomes a widespread phenomenon, there will be significant changes in the countryside of many countries, including Australia. Countries have worked hard to get rid of their trees because they hindered agriculture, or were required for building and even for fuel. In many countries such logging was illegal. Now the world recognises that these very trees deserve a bit more 'credit' than that.
In the next issue of On Target: Carbon Emissions and Sequestration Accounting
Bookshelf
I wonder how often we read some advice or findings in an academic or professional journal and think “that is just common sense”? Indeed, an article I found in my files recently titles “The Failure-Tolerant Leader” (by Richard Farson and Ralph Keyes in Harvard Business Review for August 2002) observed: “Like a salary, praise is less likely to motivate when it's given out than demotivate when it's expected but withheld.” But then they say that common sense is not so common.
Don't forget that your ICMA membership includes a subscription to CEO Online (www.ceoonline.com). See On Target for details of how to subscribe. This subscription will keep you up-to-date and provides “expert talk”, case studies, a resources centre and a useful forum and links to other sites. The subscription also has “Top 10 Business tips for the month” with articles and links to case studies.
An article that I downloaded recently was “10 Customer Service Tips to Build Loyal Customers” by Ingrid Cliff. While two of the tips were “common sense” suggestions to “Say thank-you” and “Smile and be friendly” (but then some might say that common courtesy is as common as common sense). Other tips included very useful things to think about: “little things mean a lot; keep in touch; remember significant events”.
Another article on this site is “To Compete Globally, Create Passionate People!” by Charles B Kovess. Kovess argues that too often we see organisations loudly proclaim that “people are their greatest resource”, and then, a short time later, announce massive downsizing strategies, to make their cost structures more competitive. He argues that an investment in people will reduce costs, increase loyalty, increase performance, and ensure long-term, global, sustainable competitive advantage.
Bill Richardson
Professional Lifestyle Benefits
CEO Online Access Free Subscription to Invaluable Business Resource
We have the pleasure to announce that ICMA members have the privilege of FREE access to business articles, case studies, tips, audio seminars and interviews published on CEO Online, which is worth nearly $200.00 per year. CEO Online is a 24/7 global centre of learning, providing the latest in management thinking from around the world. ICMA invites members to register for FREE SUBSCRIPTION to the total business resources of the CEO Online web site – www.ceoonline.com
It takes only a few minutes to complete this registration by clicking on http://www.ceoonline.com/forms/register.aspx. Scroll down and please select the “Other” subscription level from the drop-down list, and enter the Sponsor id – icma – when requested.
Upon successfully completing the registration form, you will receive email confirmation of your complimentary CEO Online subscription.
ICMA members who are registered as CEO Online subscribers are eligible to win A$1,000 (or the jackpot) when they successfully play and win CEO Online's business game, Who wants to be a CEO? Visit http://www.ceoonline.com/business_game.aspx for more details.
TIME magazine special discount to ICMA members
The Time Inc loyalty program. Australian members who wish to take up the special subscription offer will have ring/email in and request the 'special ICMA deal' and quote the effort key.
The deal
The current pricing sits at A$2.09 per issue for 55 issues = $115.00 for a full year subscription.
This is a 62% discount off the cover price, per issue.
Normal cover price is A$5.95 per issue, and this is significantly cheaper than our special subscription rate. The deal will last for the entire 2007 calendar year.
Mechanics TIME customer service number is Ph # is 1300 720 500
Email is: customer_service@timeinc.com.au
effort key: TSCMAA (members will need to quote this code)
The terms Rates include GST and are available to Australian residents only.
What’s On?
January 12 to April 5, 2008
Manila, Philippines
CMA Program conducted by CMA Philippines
10th - 17th February,2008
Mumbai
CMA Symposium on Advanced Management Accounting and Advanced Strategic Management Accounting conducted by CMA India
14 February, 2008
Bandung, Indonesia
1st Parahyangan International Accounting & Business Conference
15 February, 2008
Brisbane, Australia
Symposium on Accountability, Governance and Performance
Conducted by Griffith Business School
Feb, 2008
Venue: TBA, UK
CMA Program on Advanced Management Accounting conducted by CMA Europe
Feb, 2008
Venue: TBA, UK
CMA Program conducted by CMA Europe
May 10 to July 26, 2008
Manila, Philippines
CMA Program conducted by CMA Philippines
August 30 to Nov 22, 2008
Manila, Philippines
CMA Program conducted by CMA Philippines
ICMA endorses Liquid Learning conferences and seminars for CPD.
Endorsed Conferences:
20 – 21 Feb 08
3rd Annual Strategic Management Accounting Forum 2008
Crowne Plaza Darling Harbour, Sydney
21 – 23 May 2008
Fast Management Reporting Summit 2008
Citigate Central, Sydney
http://www.liquidlearning.com.au
|
