Forensic Accounting Services for Financial Institutions in Macedonia
Strengthening Financial Sector Governance in Macedonia
Macedonia, the former Yugoslav Republic of - As Macedonia continues to strengthen its financial sector, it has become increasingly important for financial institutions to adhere to international accounting standards. A recent report by the World Bank has highlighted several deficiencies in the country’s current arrangements for observing these standards.
Deficiencies in Compliance with International Accounting Standards
According to the report, while the Trade Company Law requires all entities to comply with translated International Accounting Standards (IAS), enforcement is not effectively carried out. As a result, financial statements reviewed by the ROSC team were of such poor quality that they could not be relied upon for investment decisions or other purposes.
Recommendations for Improvement
To address these issues, the report recommends:
- Requiring public interest entities to use IAS
- Allowing small- and medium-sized enterprises (SMEs) to use a reporting framework more adapted to their size
- Strengthening accounting standards enforcement mechanisms to enhance compliance with the law and provide investors and other users of financial statements with reliable information
Enhancing Oversight and Regulation
The report also advocates for the establishment of a regime of delegated regulation of the auditing profession, subject to adequate oversight. This is in line with recent international experience in developed economies and accession countries.
Government Initiatives
The Macedonian government has already taken steps to address these issues, preparing a new Trade Company Law and Audit Law that will resolve existing deficiencies and bring the country’s regulations in line with European Union law.
Conclusion
In conclusion, Macedonia’s financial institutions must prioritize the adoption of forensic accounting services to ensure compliance with international standards and provide investors and other stakeholders with reliable financial information. By implementing these measures, Macedonia can strengthen its financial sector governance and improve its attractiveness to foreign investors.