Azerbaijan to speed up switch on IFRS as part of global crisis preventive measures
Azerbaijan, Baku, Feb. 25 / Trend , U.Ismayilova/
Azerbaijan may begin independent development of financial reporting in line with international standards in the next four years, Azerbaijani Finance Ministry Finance and Metrology Department Alikhan Javadov said at a workshop on implementation of the Corporate and Fiscal Accounting Project jointly with the World Bank.
"To implement the project and fully transit to the International Financial Reporting Standards (IFRS), a special center for non-bank, government and corporate structures will be established at the Finance Ministry," he said.
Ministry's center for banks that were first in Azerbaijan to switch on IFRS is already available, he said.
According to Javadov, implementation of the project, that is accelerating transition to international financial reporting standards for all structures in the country, will also be one of Government's preventive measures on the backdrop of the global economic crisis.
The Ministry is currently the first phase of the project. The phase envisages improvement of legislative base and bringing it to the attention of all commercial and nonprofit entities, he said
The total cost of the Corporate and Fiscal Accounting Project is $24 million. The International Development Association (of WB) provided $11 million (for a period of 35 years with a grace period of 10 years), Japan Government allocated a 3-million-dollar grant, the Swiss Government allotted a two-million-dollars grant, and the Azerbaijani Government provided of $8 million.
Interest rate on WB's loan is 1.25 percent from Aug. 1, 2018 to Feb. 1, 2028 and 2.5 percent from Aug. 1, 2028 to Feb. 1, 2043. Duration of the project, which was signed in December 2008, is until December 2012.
The project envisages $6 million for introduction of IFRS in the commercial sector, $10 million for the International Public Sector Accounting Standards (IPSAS), Public Internal Finance Control), and improvement of external audit in the public sector, as well as $8 million for improvement of accounting and auditing management. Swiss State Secretariat's funds will be spent for improving internal financial controls over public revenues management (the state budget and enterprises). Advisory services are envisaged to support transformation of the Accounting Chamber into an independent Higher Audit Institute.
Azerbaijan has prepared 28 national commercial standards. There are 35 standards of financial reporting and auditing in the world. Azerbaijan's state sector launched transition to IFRS from Jan. 1, 2008.
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