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Update on accounting and financial reporting requirements in Kosovo

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22 Feb 2012

A new law on accounting, financial reporting and auditing has been approved in Kosovo. The law introduces laws defining which companies will apply which accounting standards, and it defines the powers of responsibilities of the newly formed Kosovo Council for Financial Reporting (KCFR).

Presented below are the main points of the new law.

Financial reporting requirements

  • Large business organisations and all business organisations registered as limited liability companies or shareholder companies in Kosovo, shall apply International Financial Reporting Standards (IFRS), including interpretations, recommendations and guidance issued by the International Accounting Standard Board, as approved by the Kosovo Council for Financial Reporting (KCFR)
  • Consolidated financial statements of relevant business organisations shall be in accordance with Directive 78/660/EEC of EU and IFRS
  • Financial statements shall be audited by statutory audit firms or auditors that are licensed to carry out statutory audits by the KCFR
  • All statutory audits in Kosovo, which include all audits required under this law, and external independent audits of other business or not-for-profit, socially owned or publicly owned enterprises or other entities as mandated by other applicable laws in Kosovo shall be carried out in accordance with the International Standards of Auditing (ISAs), and related interpretations, guidance and pronouncements of the International Auditing and Assurance Standards Board (IAASB), and by auditors that are approved by the KCFR to carry out statutory audits

KCFR functions and responsibilities

  • To draft and approve Kosovo Accounting Standards in accordance with International Accounting Standards IAS/IFRS and relevant EU directives
  • Supervise and implement Auditing Standards in accordance with ISA and relevant EU directives
  • Licensing and keeping register of auditors as well as of the audit firms and professional associations of accounting and auditing
  • Adoption of the standards of professional ethics, internal quality of auditing firms
  • Supervise continuous education, quality assurance and disciplinary system

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