USAID/IBTCI-%20PSARP

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USAID/IBTCI- PSARP
Accounting and Auditing in BiH
Senad Pekmez Senior Accounting
Consultant USAID/IBTCI Private Sector
Accounting Reform Project Bosnia and Herzegovina
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USAID/IBTCI- PSARP
STATE STRUCTURE

• BOSNIA AND HERZEGOVINA
• UNDER DAYTON AGREEMENT COMPOSED
• OF TWO ENTITIES
• FEDERATION OF BIH and
• REPUBLIC OF SRPSKA

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USAID/IBTCI- PSARP

• FEDERATION OF BIH
• Responsible Institutions
• Institute for Accounting and Auditing of FBiH
  (Government Institution)
• 2. Association of Accountants and Auditors of
  FBiH (Private Sector)
• 3. Securities Commission of FBiH

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USAID/IBTCI- PSARP
Legal Accounting Framework in FBiH

• Law on Accounting (from 1995 amended in 1998)
• - 32 Accounting Standards in a force from
  1999 (IAS)
• - New Chart of Accounts
• - New Format of Accounts (Set of Financial
  Statements)

2. Law on Auditing (from 1995 amended 1998)
- Auditing Standards - Translation of
IFAC International Standards on Auditing and
Related Services (1998 edition)
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USAID/IBTCI- PSARP
Legal Accounting Framework in FBiH
3. Law on Enterprises - Every
shareholding company should have audited
financial statements, subject of approval of
annual shareholdes assembly
4. Requirements issued by the SEC of FBiH -
By Law on contents, way and standards of
disclosure of financial reports
and other information concerning the activities
of shareholders company (OECD rules)
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USAID/IBTCI- PSARP
REPUBLIC OF SRPSKA
Responsible Institutions 1.
Association of Accountants and Auditors of RS
(Private Sector) 2. Securities Commission of RS
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USAID/IBTCI- PSARP
Legal Accounting Framework in RS

• Law on Accounting
• - 33 Accounting Standards published in 2000
  (IAS)
• - New Chart of Accounts
• - New Format of Accounts (Set of Financial
  Statements)

2. Auditing Standards - Translation of
IFAC International Standards on Auditing
and Related Services (1998 edition)
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USAID/IBTCI- PSARP
Legal Accounting Framework in RS
3. Law on Enterprises - Medium and large
shareholding companies should have audited
financial statements, subject of approval of
annual shareholdes assembly
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USAID/IBTCI- PSARP
Tasks and Goals of Profession and Project in
Accounting Reform

• Building the Audit Profession
• - To have audit firms in each entity capable
  of auditing in
• accordance with ISA and reporting on
  financial statements
• in accordance with IAS
• - Current activities organizing Audit Case
  Study training
• for 300 auditors. Each participant will
  be expected to agree to
• a post-training on-site visit by an
  experienced international
• auditor to review workpapers, discuss
  audit issues and assist in
• the application of sound audit practice.

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USAID/IBTCI- PSARP
Tasks and Goals

• 2. Modernizing University Curricula Reform
• - To have BiH universities adopt a modern
  accounting and auditing curriculum fully in
  accordance with UNCTAD and IFAC guidelines.
• - Seven BiH Universities signed MOA for
  implementing new curricula.
• translating, publishing and delivering new
  accounting, auditing, cost accounting and
  financial management textbooks to students and
  professors.
• Organizing Summer 2003 training for University
  professors

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USAID/IBTCI- PSARP
Tasks and Goals

• Enterprise Assistance in Applying IAS
• - private enterprises to improve their
  competitiveness, profitability, and access to
  foreign and domestic capital through modernizing
  their financial reporting and management
  accounting
• - present courses on financial reporting
  (IAS) and managerial accounting to enterprise
  accountants,
• - implement program of on site assistance to
  enterprises
• - train and subcontract local accounting and
  audit firms in the provision of assistance to
  individual enterprises

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USAID/IBTCI- PSARP
Tasks and Goals
4. Support to Professional Associations - A
professional associations of accountants and
auditors, with nationwide representations, made
suitable, and becomes a member of IFAC - The AAA
of FBiH and the AAA of RS are in negotiations
regarding the Charter for State Level Association
of Accountants and Auditors.
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USAID/IBTCI- PSARP
Tasks and Goals
5. Legal Regulatory Reform - to have a
nationwide law on accounting and auditing that
fully embraces International Accounting
Standards and International Standards on
Auditing 6. Other Activities - work closely
with SEC on preparing and issuing the rules which
regulate accounting and auditing for the players
in capital market (brokers, dealers, PIFs, MC,
listed shareholding companies etc.)
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USAID/IBTCI- PSARP
Tasks and Goals
Build a stronger relation between responsible
institution MF, IAA, AAA, and SEC in a both
entities and nationwide - To have better control
and monitoring of applying IAS and ISA in
financial reporting and auditing. - To have
accurate, fair and true financial reporting and
disclosure of information for users of financial
statements in capital market