Turkey’s Authority Takes Charge of Accounting Standards and Auditing Regulations

Harmonizing Accounting Standards

The Public Oversight Authority of Turkey (KGK) has taken on a crucial role in shaping the country’s accounting standards and auditing regulations. As part of its mandate, the KGK sets Turkish Accounting Standards (TASs) and Turkish Financial Reporting Standards (TFRSs), which are fully compliant with International Financial Reporting Standards (IFRSs).

A Harmonized Approach to Accounting Standards

The KGK has adopted IFRS Standards for public interest entities (PIEs), including companies whose securities are traded in a regulated market, intermediary institutions, and portfolio management companies. These standards have been incorporated into laws and regulations as TASs and TFRSs, which are published in the Official Gazette.

Financial Reporting Standards for Large and Medium-Sized Entities

To cater to the needs of large and medium-sized entities, the KGK developed the Financial Reporting Standard for Large and Medium Sized Entities (BOBI FRS), which was published in 2017. This standard provides a cost-effective way of financial reporting and introduces additional obligations for large-sized entities.

Simplifying Financial Reporting for Small and Micro Entities

In addition to BOBI FRS, the KGK is working on a new standard for small and micro entities, known as Financial Reporting Standard for Small and Micro Entities (KUMI FRS). This standard aims to provide a cost-effective way of financial reporting for these entities, with simpler requirements and exemptions compared to small-sized entities.

Strengthening Auditing Standards

The KGK is also responsible for setting Turkish Standards on Auditing (TSAs), which are based on international standards. To ensure audit quality in Turkey, the KGK has signed a copyright agreement with the International Federation of Accountants (IFAC) and translated substantially all of the suite of international auditing and audit-related standards.

Authorizing and Registering Auditors

To carry out audits in Turkey, auditors or audit firms must be authorized by the KGK. Authorizations are granted based on the candidate’s qualifications, experience, and a thorough examination process.

Conclusion

The Public Oversight Authority of Turkey plays a vital role in promoting transparency and accountability in Turkey’s financial markets. Its efforts to harmonize accounting standards and strengthen auditing regulations demonstrate its commitment to ensuring the integrity of the country’s economy.