Addis Ababa, Ethiopia (31 August 2022)
In line with Ethiopia’s Accounting and Auditing Board (AABE) mission to achieve full implementation of International Financial Reporting Standard (IFRS) across the country, regional states are no longer allowed to issue a license to accountants and auditors as of the newly started fiscal year.
Previously, regional authorities were given a trustee mandate to license accounting industry experts for more than five years. However, according to The Reporter, financial reports were not produced in accordance with the same standards, causing multiple bankruptcies and harming the economy as a whole. Following the recognition of this, this power granted to the regions by the Ministry of Finance has been revoked beginning with the FY 2022/23. The decision makes the AABE of Ethiopia the sole institution with the authority to register and renew accountants’ and auditors’ licenses throughout the country. Harari and Sidama regions are the first to handover the documents of accountants and auditors whom they have registered, while other regions are expected to follow.
Among institutions, the Commercial Bank of Ethiopia (CBE) was the first to fully implement IFRS in Ethiopia. It was followed by the country’s 17 banks and the same number of insurance companies. There are three types of IFRS implementers: full implementers, IFRS for small and medium-sized institutions, and IFRS for charities (IPSAS). Institutions must have annual budgets or revenues of at least ETB300 million and at least 200 employees to be eligible for full IFRS implementation. Small and medium-sized businesses have annual revenues of ETB20 million to ETB300 million and employ 20 to 200 people.
Source: The Reporter
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