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Estonia: e-Reporting and the new Certified Public Accountants Act - The keyword for audit season 2009/2010 is e-reporting. This area definitely overshadows other observations. Without going into details of the benefits and shortcomings of the e-reporting portal and system, I would like to draw attention to some circumstances related to the e-reporting, says Mart Nõmper, Member of the Management Board and Sworn Auditor at Rödl & Partner Audit OÜ.

- Although the system is far from perfect, it is significantly better than the initial version in use in January. At least as much work should still be done in correcting the system and I know this work is under way and next season the undertakings, accountants and auditors will have a much better e-reporting system to use. Naturally the system could have been better to begin with, but with these kind of large-scale developments all problems cannot be foreseen. Perhaps a transitional period could have improved the situation, but this should not be the topic under discussion and I recommend everyone who has focused their energy on criticizing the system, to channel their energy on improving the system by sending the developers suggestions and advice on how to improve the system and by providing constructive criticism of the shortcomings. Moreover – one cannot turn back time and to give credit to the developers I must say that good advice is heard and suggestions on how to improve the system are put into practice and will not stay on someone's desk or e-mail inbox. Therefore this is the time to use the possibilities and develop a system which is effective and comfortable to use in the future!

- Another significant change for the everyday work of auditors is the new Certified Public Accountants Act, which entered into force last women's day, says Mart Nõmper. The Certified Public Accountants Act valid before was obsolete and the new act was long-awaited.

- If for undertakings and accountants the biggest changes were changes in the limits of auditing and the establishment of review - audit control providing less assurance compared to a full audit, then for auditors the changes were a lot more significant. Most direct influence for auditors is recertifying: in order to carry on with activities, all current auditors must pass the International Standards on Auditing test. Personally I find that the test will not be problematic for any auditor and passing the test should not be difficult for a competent auditor.

- A lot more significant change is the meticulous supervision of professional activities incl. quality control, involved with the new act. Auditors provide an important added value for society - assurance. In order to ensure that the assurance finds its way into everyday (financial)life, not only legislation, several new occupations have been established or are being established: President of the Board of Auditors, chancellor, methodology and in-service training specialist, supervision specialist. All this shows that the Estonian auditors community is developing into a professional, mature and well organized community. This also provides new challenges for auditors, like the increase of membership fees and insurance fees and therefore in order to meet all the requirements, the auditors must continuously consolidate.

- For accounting, the trends have been both positive and negative. Accountants, but delightfully also a lot of managers, are better informed of the necessity to evaluate assets.

- Also the nature of the work done by auditors is clearer and people have realized that a qualified opinion in the auditor's report, sworn auditor's report by new terminology, is nothing to be ashamed of and feared, concludes Mart Nõmper. Especially considering investment properties, which are often impossible or very difficult to evaluate due to the low amount of transactions at the market. For auditors, this situations means that the audit is limited, which means it is not possible to determine true and fair disclosure of the investment properties. It should be noted that this is not the case of single deviation opinion i.e. situation where the auditor manages to perform all the control procedures and has obtained enough evidence to assert that the financial statements as a whole or part of it does not present a true and fair view of reality.

Mart Nõmper
Member of the Management Board, Sworn Auditor
Rödl & Partner Audit OÜ
Tel: (+372) 680 7646