Glossary of Terms

This glossary comprises terms that are specifically defined within the International Education Standards (IES). Many terms may have different common meanings, nuances of meaning, and applications in different countries. The glossary does not prescribe the use of terms; rather, it clarifies the meaning of terms included in the IES and within the IFAC Accountancy Education E-tool.

Words and phrases that are underlined link to their definitions elsewhere in the glossary.

The definitions in this glossary are effective from January 1, 2020.

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Aspiring professional accountant

An individual who has commenced a professional accounting education program as part of Initial Professional Development.

Assessment

Evaluation of professional competence developed through learning and development.

Assessment activity

Those activities designed to assess specific areas of professional competence.

Combination approach

A combination approach combines elements of input-based and output-based approaches.

Competence area

A category for which a set of related learning outcomes can be specified.

Content validity (of assessment)

In relation to assessment, whether an assessment activity provides adequate coverage of the particular aspect of professional competence being assessed.

Continuing professional development (CPD)

Learning and development that takes place after initial professional development, and that develops and maintains professional competence* to enable professional accountants to continue to perform their roles competently.

Cooperative education

A program of education, generally leading to a degree, which includes alternating periods (e.g., terms, semesters, trimesters) of academic study and full-time work experience. This will generally result in additional time required to complete degree requirements.

Education

Systematic process aimed at acquiring and developing knowledge, skills, and other capabilities within individuals, a process that is typically but not exclusively conducted in academic environments.

Equity (of assessment)

In relation to assessment, whether an assessment activity is fair and without bias.

Face validity (of assessment)

In relation to assessment, whether an assessment activity is perceived to measure what it is intended to measure.

Financial statements

A structured representation of historical financial information, including disclosures, intended to communicate an entity's economic resources or obligations at a point in time or of the changes therein for a period of time in accordance with a financial reporting framework. The term "financial statements" ordinarily refers to a complete set of financial statements as determined by the requirements of the applicable financial reporting framework, but can also refer to a single financial statement. Disclosures comprise explanatory or descriptive information, set out as required, expressly permitted or otherwise allowed by the applicable financial reporting framework, on the face of a financial statement, or in the notes, or incorporated therein by cross-reference.

The financial statements subject to audit are those of the entity, prepared by management of the entity with oversight from those charged with governance.

Firm

A sole practitioner, partnership, corporation, or other entity of professional accountants.

Formal education

The non-workplace based component of an accounting education program.

Good practice

Those elements considered essential to the education and development of professional accountants and performed at a standard necessary to the achievement of professional competence.

Information and communications technologies (ICT)

Established and emerging technologies, techniques, and processes used to capture, manage, transform, or communicate data and information.

Initial professional development (IPD)

Learning and development through which aspiring professional accountants first develop competence leading to performing a role as a professional accountant.

Input measure

An input-based measure focuses on the investment made in learning and development, for example, the number of hours an individual is expected to attend a course or the subject areas covered.

Input-based approach

An approach that establishes an amount of learning activity required for professional accountants to develop and maintain professional competence.

Intellectual skills

Skills relating to the ability of a professional accountant to solve problems, to make decisions, adapt to change, and exercise professional judgment.

Interpersonal and communication skills

Skills relating to the ability of a professional accountant to work and interact effectively with others.

Learning and Development

An ongoing process of developing and maintaining professional competence throughout the career of a professional.

Learning outcome

The content and the depth of knowledge, understanding, and application required for a specified competence area.

Monitoring

Systematic process of collecting, reviewing, and confirming the evidence that demonstrates professional competence has been developed or maintained.

Organizational skills

Skills relating to the ability of a professional accountant to work effectively with or within an organization to obtain the optimal results or outcomes from the people and resources available.

Output measure

An output-based measure focuses on whether the professional accountant has developed the specified competence.

Output-based approach

An approach that requires professional accountants to demonstrate, by way of achieved learning outcomes, that they develop and maintain professional competence.

Personal skills

Skills relating to the personal attitudes and behavior of a professional accountant.

Practical experience

Workplace and other activities that are relevant to developing professional competence.

Practical experience supervisor

A professional accountant who is responsible for guiding, advising, and assisting aspiring professional accountants in acquiring sufficient practical experience.

Predictive validity (of assessment)

In relation to assessment, whether the content of the assessment activity relates to the particular aspect of professional competence that it is intended to assess.

Professional accountant

An individual who achieves, demonstrates, and further develops professional competence to perform a role in the accountancy profession and who is required to comply with a code of ethics as directed by a professional accountancy organization or a licensing authority.

Professional accounting education

Education and training that builds on general education, and imparts (a) professional knowledge, (b) professional skills, and (c) professional values, ethics, and attitudes.

Professional accounting education program

Programs designed to support aspiring professional accountants to develop the appropriate professional competence by the end of initial professional development. They may consist of formal education delivered through degrees and courses offered by universities, other higher education providers, IFAC member bodies, and employers, as well as workplace training.

Professional competence

The ability to perform a role to a defined standard.

Professional judgment

The application of relevant training, knowledge, and experience, within the context provided by auditing, accounting, and ethical standards, in making informed decisions about the courses of action that are appropriate in the circumstances of the audit engagement.

Professional knowledge

Those topics that make up the subject of accountancy as well as other business disciplines that, together, constitute the essential body of knowledge for professional accountants.

Professional skepticism

An attitude that includes a questioning mind, being alert to conditions which may indicate possible misstatement due to error or fraud, and a critical assessment of evidence

Professional skills

Intellectual, interpersonal and communication, personal, and organizational skills that a professional accountant integrates with technical competence and professional values, ethics, and attitudes to demonstrate professional competence.

Professional values, ethics, and attitudes

The characteristics that identify professional accountants as members of a profession. They include the principles of conduct (e.g., ethical principles) generally associated with and considered essential in defining the distinctive characteristics of, professional behavior.

Qualification

Qualification as a professional accountant means, at a given point in time, an individual is considered to have met, and continues to meet, the requirements for recognition as a professional accountant.

Reflective activity

The iterative process by which professional accountants, at all stages of their career, continue to develop their professional competence by reviewing their experiences (real or simulated) with a view to improving their future actions.

Relevant ethical requirements

Those ethical requirements to which professional accountants are subject, which ordinarily comprise the International Ethics Standards Board for Accountants' International Code of Ethics for Professional Accountants (including International Independence Standards) (IESBA Code) together with any national requirements that are more restrictive.

Reliability (of assessment)

In relation to assessment, whether an assessment activity consistently produces the same result, given the same set of circumstances, quality or state describing whether a measurement approach consistently produces the same result, given the same set of circumstances.

Role

A function that has a specific set of expectations attached.

Specialization

The formal recognition by a member body of a group of its members possessing distinctive competence in a field, or fields, of activity related to the work of the professional accountant.

Sufficiency (of assessment)

In relation to assessment, whether an assessment activity has a balance of depth and breadth, knowledge and application and, combines material from different areas applied to a range of situations and contexts.

Sufficiency (of practical experience)

Whether practical experience has a balance of depth and breadth, knowledge and application and, where appropriate, integration of material from different areas applied to a range of situations and contexts.

The breadth of practical experience is affected by factors such as: nature of role; level of proficiency, prior level of formal education, national or local laws; requirements of regulatory authorities; and the public's expectation for professional competence.

The depth of practical experience is affected by factors such as: the variety and complexity of tasks; level of supervisory and mentoring support.

Technical competence

Technical competence is defined as the ability to apply professional knowledge to perform a role to a defined standard.

Training

Learning and development activities that complement education and practical experience. Training emphasizes practical application, and is usually conducted in the workplace or a simulated work environment.

Transparency (of assessment)

In relation to assessment, whether details of an assessment activity, such as competence areas to be assessed and timing of the activity, are disclosed publicly.

Validity

Quality or state describing whether a measurement approach measures what needs to be measured.

Verifiable evidence

Evidence that is objective, and capable of being proven and retained.

Work log

A record maintained by an individual of the nature of the assignments and tasks completed, and of the time incurred in completing those assignments and tasks. A work log might also include documentation of competences developed as a result of completing work assignments.

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Description of Levels of Proficiency

This description of levels of proficiency supports the use of learning outcomes in publications on professional accounting education such as IES 2, 3, and 4. It provides descriptions of three levels of proficiency. These descriptions, together with the learning outcomes, provide information to help IFAC member bodies design their professional accounting education programs for a variety of professional accounting roles and specializations.

Level of Proficiency Description

Foundation

Typically, learning outcomes in a competence area focus on:

  • Defining, explaining, summarizing, and interpreting the underlying principles and theories of relevant areas of technical competence to complete tasks while working under appropriate supervision;
  • Performing assigned tasks by using the appropriate professional skills;
  • Recognizing the importance of professional values, ethics, and attitudes in performing assigned tasks;
  • Solving simple problems, and referring complex tasks or problems to supervisors or those with specialized expertise; and
  • Providing information and explaining ideas in a clear manner, using oral and written communications.

Learning outcomes at the foundation level relate to work environments that are characterized by low levels of ambiguity, complexity, and uncertainty.

Intermediate

Typically, learning outcomes in a competence area focus on:

  • Independently applying, comparing, and analyzing underlying principles and theories from relevant areas of technical competence to complete work assignments and make decisions;
  • Combining technical competence and professional skills to complete work assignments;
  • Applying professional values, ethics, and attitudes to work assignments; and
  • Presenting information and explaining ideas in a clear manner, using oral and written communications, to accounting and non-accounting stakeholders.

Learning outcomes at the intermediate level relate to work environments that are characterized by moderate levels of ambiguity, complexity, and uncertainty.

Advanced

Typically, learning outcomes in a competence area focus on:

  • Selecting and integrating principles and theories from different areas of technical competence to manage and lead projects and work assignments, and to make recommendations appropriate to stakeholder needs;
  • Integrating technical competence and professional skills to manage and lead projects and work assignments;
  • Making judgments on appropriate courses of action drawing on professional values, ethics, and attitudes;
  • Assessing, researching, and resolving complex problems with limited supervision;
  • Anticipating, consulting appropriately, and developing solutions to complex problems and issues; and
  • Consistently presenting and explaining relevant information in a persuasive manner to a wide-range of stakeholders.

Learning outcomes at the advanced level relate to work environments that are characterized by high levels of ambiguity, complexity, and uncertainty.