Analyst talks obstacles for development of audit services in Azerbaijan

Finance Materials 9 April 2021 09:44 (UTC +04:00)
Analyst talks obstacles for development of audit services in Azerbaijan

BAKU, Azerbaijan, Apr.9

By Zeyni Jafarov – Trend:

Most of economic entities are irresponsible in conducting financial reporting, despite the documents of the normative legal nature of Azerbaijan ‘On the Audit Service’ and ‘On Accounting’, Director of A Audit&Consulting company, Rufat Aliyev, told Trend.

According to Aliyev, sanctions for evading a statutory audit were introduced back in 2011, but the body that draws up the protocol on the administrative offense has not been determined.

“Since May 2017, after determining the procedure for the application of administrative fines to violators of the law, in relation to banks, insurance companies and joint-stock companies, protocols began to be drawn up by the Chamber for Supervision of Financial Markets (now the Central Bank), and in relation to other commercial and non-commercial organizations - by the Chamber of Auditors,” the consulting company’s director said.

According to the Code of Administrative Offenses, if the protocols drawn up against legal entities that have not passed the mandatory audit of financial statements are confirmed in court, they will be fined from 1,500 manat ($882) to 2,500 manat ($1,470), Aliyev said.

“One of the main problems of entrepreneurs is that, having paid a fine, they think that this will exempt them from the statutory audit. In reality, there is nothing like this, since after paying the fine, business entities are required to audit financial statements for evading a statutory audit. This, in turn, costs twice as much and is not desirable for any entrepreneur,” Aliyev emphasized.

“A lot of work is being done to develop audit services in Azerbaijan. This direction is new and it is developing. However, the main obstacle to bringing the audit service to the proper level is the indifference of entrepreneurs to this process,” added the company’s director.

(1 USD = 1.7 manat on Apr.9)


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