Agreed Upon Procedures

Banyak pertanyaan terkait prosedur yang disepakati (agreed upon procedures)diantaranya tanggung jawab atas prosedur yang disepakati (agreed upon procedures), konsep materialitas, bantuan spesialis, laporan akuntan, management letter, dan perikatan dengan prosedur yang disepakati (agreed upon procedures) pada standar internasional.

Anda bisa mendapatkan jawaban-jawaban atas pertanyaan di atas dalam artikel yang dipublikasikan oleh Anggota Russell Bedford International di Indonesia yaitu KAP Syarief Basir & Rekan dan ditulis oleh Syarief Basir, Ak., CPA, MBA. Anda bisa mendownload dari http://www.russellbedford.co.id/downloads/publications/cbb0a_Naskah%20Juni%202009.pdf

Realigning oil cost recovery

The Jakarta Post | Fri, 05/29/2009 9:29 AM | Opinion

The disputes between government and oil contractors over cost recovery could worsen because of a long delay in the issuance of regulations on new accounting guidelines for expenditure under production-sharing contracts, as required by the 2009 State Budget Law.

The law sets the total costs that can be recovered by oil contractors this year at US$11.05 billion, but regulations on the technical details of this cost recovery mechanism, which were supposed to be effective as of January, are still being finalized, Oil and Natural Gas Director General Evita Legowo said this week.

The controversy over cost recovery by contractors heightened in late 2006, after the Supreme Audit Agency (BPK) revealed that in its audit of major oil contractors in 2004-2005 it had found almost $1.8 billion in potential losses to the state due to excessive cost accounting.

These findings created the impression that contractors had used the cost-recovery account as a dumping ground for all kinds of expenses, irrespective of their relevance to exploration or production.

The parliament joined the fray and has since last year put the cost-recovery mechanism under stringent public scrutiny by regulating it under the state budget law.

True, the government must control what kinds of expenditure oil contractors can recover because the government’s take (share) of the oil or natural gas fields under production-sharing contracts is based on a net take after costs are recovered by contractors. But what we have now seems to be more uncertainty and bureaucratic inertia, since the required regulation is already five months behind schedule.

The BPK recommendation that oil contractors reimburse the government with the $1.8 billion in excessive costs has remained unheeded because of differing opinions on the cost recovery claims.

Simply leaving this auditor recommendation pending without any resolution could put oil contractors into legal limbo because the BPK finding could trigger corruption investigations of oil executives by the Attorney General’s Office.

It is most urgent now for the government to enact as soon as possible the regulation on oil contract cost recovery, to prevent further uncertainty in the upstream petroleum industry. But a regulation alone, even with clear-cut provisions, will not be effective enough to prevent disputes unless the Upstream Oil and Gas Regulatory Body (BP Migas) is adequately equipped and staffed to supervise the operations of oil contractors.

The BPK finding of $1.8 billion of what auditors called “excessive costs” puts into question the technical competence of BP Migas in supervising contractors’ operations.

The fact is the BP Migas supervisory mechanism already consists of pre-audit work done through its assessments of plans for development, working programs and budget plans proposed by contractors; current audits through the compulsory reporting of activities by contractors and the monitoring and inspection of contractors’ operations; and post audit checks by external auditors such as BPK and the government finance comptroller (BPKP).

That BPK auditors found so many irregularities in the costs recovered by contractors despite multiple layers of auditing could mean either of two things: The BPK is unable to perform its job properly, or the cost-recovery directives are so loose and ambiguous (and vulnerable to multiple interpretations) that even the internal auditors of contractors — most of which are subsidiaries of major international oil firms — are unable to comprehend them.

Source : www.thejakartapost.com/news/2009/05/29/realigning-oil-cost-recovery.html

Time limit sought for public accounting contracts

The Jakarta Post , Jakarta | Thu, 09/26/2002 7:04 AM | Business

Fitri Wulandari, The Jakarta Post, Jakarta

Public accountants auditing the books of publicly listed companies will need to limit their contract to three years if a proposed ruling is approved to prevent long-standing ties between companies and auditors from hurting the independency of the accounting industry.

""There should be a limitation set for public accounting firms when providing their auditing services to public companies,"" said the former finance minister and a member of the Indonesian Accounting Association's (IAI) advisory board, Mar'ie Muhammad, on Wednesday.

He said companies should get their auditing services from another public accountant after three years.

Speaking on the sidelines of IAI's 10th congress, his proposal came in support of the government's plan to restrict the contract period to four years under a new accounting bill.

The Ministry of Finance is drafting measures to tighten the independency of public auditors following a slew of accounting scandals in America that deprived employees at publicly listed companies and stock investors of billions of U.S. dollars.

Experts have blamed these scandals on auditors turning a blind eye to companies' questionable book entries over concern they might lose their lucrative contracts.

At home, reports of auditors cooking their clients' books have been scant, but regulators are moving to pull them in line with trends to improve the industry's frugality.

Nearly 70 percent of local audit and financial services are being provided by the so-called Big Five, the very same firms that dominate accounting and consulting services worldwide.

Except for Andersen Consulting, which has lost most of its clients following its role in several accounting scandals, they are PricewaterhouseCooper, Ernst & Young, KPMG and Deloitte Touche Tohmatsu.

Some 200 small and medium-sized public accounting firms are jostling for the remaining 30 percent share of the market.

Head of IAI's public accounting department, Ahmadi Hadibroto, said limiting the contract period may help avoid vested interests but warned of possible pitfalls.

""If the public wants to have a time limitation on auditing services, we'll go with it. But it should be thoroughly reviewed as it will have a wide impact on the business,"" Ahmadi said.

Public accountants need to become familiar with a company's finances within a limited period and then move on to learn another's, he said.

""The fee we charge our clients will certainly go up,"" he said.

Furthermore, Ahmadi added, the longer a public accountant stays with a company the better it knows its business and therefore may provide a much better service. It will sharpen their auditing capability.""

He said many public accounting firms invest their money in educating their accountants to specialize in handling the industry, such as mining companies.

Time limitation would also take away the incentive for public accounting firms to train their auditors in a particular industry, he said. Again, the impact would be on service quality, he said.

Instead of three years, Ahmadi suggested auditors should be allowed to retain their clients between five and seven years.

Only a few details are known about the new accounting bill, but the finance ministry may ask public accounting firms to also separate their auditing services from consulting in another move to weed out vested interests.

Source : http://www.thejakartapost.com/news/2002/09/26/time-limit-sought-public-accounting-contracts.html