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Publication(Washington, DC, 2013-06-01) World BankThis assessment of accounting and auditing practices in Moldova is part of a joint initiative that is implemented by the World Bank and the International Monetary Fund to prepare Reports on the Observance of Standards and Codes (ROSC). The assessment focuses on the strengths and weaknesses of the accounting and auditing environment that influence the quality of corporate financial reporting, and includes a review of both statutory requirements and actual practice. It uses International Financial Reporting Standards (IFRS) and the International Standards on Auditing (ISA) as benchmarks and draws on international experience and good practices, as well as the European Union's acquis communautaire given Moldova's strategy of further integration with the European Union. In the medium term, improvement in Moldova's business environment is essential to put the country on a sustainable growth path. The strategic objective of this task is to support the Government in its efforts to improving the business environment in Moldova by contributing to an elevated level of competitiveness and productivity across the economy through business enterprises providing timely and reliable financial information, formulated according to internationally accepted standards, while also observing standards of governance that create confidence among local and foreign investors. These will enable companies to have greater access to finance, invest and increase their productivity. This assessment was drawn up at the request of the Government of Moldova and builds on the previous Accounting and Auditing ROSC that was prepared in 2004. The 2004 ROSC had the following objectives: (i) to spell out the ingredients of a good set of national accounting and auditing practices; (ii) to assess how Moldovan practices and its accounting profession perform relative to those practices; and (iii) to lay out the reforms needed to bring those practices and the profession into compliance with the generic model of good practices.
Publication(Washington, DC, 2004-06-28) World BankFinancial reporting and auditing practices in Moldova's corporate sector are currently in a period of transition from providing for tax calculation and statistical needs to convergence with International Financial Reporting Standards (IFRS) and International Standards on Auditing (ISA). This report draws upon recent international experience in developed economies and EU accession countries as well as expected amendments to EU Directives. The review found that, except in the banking sector, the current level of compliance with financial reporting obligations is inadequate, and that the quality of the financial reporting is low. In that context, the report recommends the following actions: (i) the capacity of regulatory agencies for enforcing accounting standards and financial reporting requirements to all entities of public interest - including large state-owned enterprises - should be increased; (ii) a public registry should be set-up for all public-interest companies to file their financial statements; and (iii) an independent oversight board of auditors should be established under the soon-to-be-issued new Audit Law, with the function to qualify statutory auditors, adopt auditing standards and develop guidelines, and monitor auditors compliance with NSA and independence requirements.
Publication(World Bank, Washington, DC, 2004-06-28) World Bank GroupFinancial reporting and auditing practices in Moldova's corporate sector are currently in a period of transition from providing for tax calculation and statistical needs to convergence with International Financial Reporting Standards (IFRS) and International Standards on Auditing (ISA). This report draws upon recent international experience in developed economies and EU accession countries as well as expected amendments to EU Directives. The National Accounting Standards (NAS) were developed on the basis of International Accounting Standards (IAS) from 1996 to 1998 for the most part, but they are substantially incomplete and out of date vis-à-vis IFRS (which incorporate IAS). Accordingly, the standard-setting process should be streamlined so as to allow the prompt adoption of the numerous existing IASs not yet reflected in the NAS. The National Standards of Auditing were developed recently and mirror ISA. The existing Accounting Law and certain aspects of the Joint Stock Companies Law are unduly onerous and restrictive in that they demand bookkeeping and other administrative procedures not normally required in market economy systems. These conflict with mandated accounting standards, confuse the preparers of financial statements and are detrimental to the quality of the financial information. A new Accounting Law should be passed with simplified requirements and incorporating key elements of the NAS and relevant EU Directives on that matter.