Financial Crime World

Iraq’s Progress on International Accounting Standards

The Iraqi Union of Accountants and Auditors (IUAA) has made significant progress in adopting international accounting standards, but there is still room for improvement.

Assessment by the International Federation of Accountants

According to a recent assessment by the International Federation of Accountants (IFAC), IUAA has adopted several international standards, including:

  • The Code of Ethics for Professional Accountants
  • Standards on Auditing
  • A system for investigating and disciplining members in accordance with international best practices

Areas for Improvement

However, there are still some areas where Iraq needs to catch up. For example:

  • International Public Sector Accounting Standards (IPSAS) have not yet been adopted by the country.
  • The financial reporting framework is based on national accounting standards that differ significantly from IFRS Standards.

Code of Ethics and Auditing Standards

The assessment found that IUAA’s Code of Ethics for Professional Accountants is partially aligned with international standards, while its auditing standards are fully adopted. Additionally, the organization’s system for investigating and disciplining members is also in line with international best practices.

Public Sector Financial Reporting

Iraq has not yet adopted IPSAS, which are widely used by governments around the world to improve transparency and accountability in public sector financial reporting. The country’s financial reporting framework is based on national accounting standards that were initially modeled on International Accounting Standards (IAS) but have since diverged from international best practices.

IFRS for Small and Medium-sized Enterprises

Iraqi companies are not required to adopt IFRS for Small and Medium-sized Enterprises (SMEs), and there are no plans to do so in the near future. This could make it difficult for these companies to access international capital markets or compare their financial performance with other countries.

Conclusion

Overall, while Iraq has made progress in adopting international accounting standards, there is still much work to be done to bring its accounting practices in line with global best practices. The country’s accountancy profession needs to continue to develop and improve its systems and processes to meet the growing demands of a rapidly changing economy.