The legal basis which serves as a legal standard for accountants is quite old namely regulated in Law No 34 of 1954 on Utilization of Accountant Title. Therefore, the Indonesian Chartered Accountants (Ikatan Akuntan Indonesia/IAI) is aiming for the Draft Bill on Financial Reporting to be passed, so that it may become a clear legal standard for accountants and it is expected to be the basis for a quality financial statement.
In essence, this Draft Bill regulates that there are several entities which must draw up a financial statement minimum 1 (one) time in a year to be audited by a public accountant. Such entities consist of:[i]
Reporting entities which are mentioned above have several obligations, including:[ii]
Basically, this Draft Bill also serves as a basis for the establishment of a new Agency, namely the Financial Reporting Authority which more or less has functions and authorities as described below:
In order to implement the Draft Bill, the Minister of Finance shall appoint 1 (one) Professional Accountant Association through Decision of the Minister to implement the authority of the Draft Bill which must fulfill the following criteria:[v]
Professional Accountant Organization shall have a Standard Board which functions to formulate and stipulate the standards for the reporting entities. The formulation and stipulation of such standards shall at least cover the following matters:[vi]
Please note that the membership in the Standard Board must at least consist of elements from the accounting professions, academicians, and reporting entities.[vii]
The financial statement which has been drawn up by the reporting entities must be given to the following parties:[viii]
The financial statement which has been submitted by the reporting entities to the Minister of Finance may be published in limited to the public, where people who want to access it will be charged.[ix]
[i] Art. 2 (1), 3 (1), dan 6, Draft Bill on Financial Reporting.
[ii] Art. 7 dan 8, Draft Bill on Financial Reporting.
[iii] Art. 10, Draft Bill on Financial Reporting.
[iv] Art. 16, Draft Bill on Financial Reporting.
[v] Art. 20, Draft Bill on Financial Reporting.
[vi] Art. 19 (1-2), Draft Bill on Financial Reporting.
[vii] Art. 19 (5), Draft Bill on Financial Reporting.
[viii] Art. 22, Draft Bill on Financial Reporting.
[ix] Art. 23, Draft Bill on Financial Reporting.