Transparent financial reporting in five new EU member states
In the wake of both globalisation and a number of significant financial reporting scandals, the EU has agreed upon uniform requirements in accounting and corporate audits for its member states. Its aim is to create better conditions for the development of the private sector through increased quality, transparency and comparability of financial reporting. Switzerland is supporting Estonia, Latvia, Poland, Slovenia and the Czech Republic in the implementation of these EU regulations with a total of just under CHF 17 million.
Exchange promotes solutions to common challenges
One focal point of the programme is the development of specialist knowledge. For example, courses on International Standards on Auditing (ISA) und International Financial Reporting Standards (IFRS) were offered for authorities and industry associations. In Estonia and Latvia, these international standards are also being translated into the national language.
The five partner countries being supported all have different starting situations, but in terms of fulfilling EU financial reporting laws they face similar challenges. For this reason, the exchange of knowledge and experience is being promoted at regional seminars – a measure that also saves programme costs.
Preventing corporate and financial offences
The programme especially helps ensure both a competitive market in auditing and the high quality of auditing services. In concrete terms, public supervision of auditors is to be strengthened in all five countries and a quality assurance system to be developed. Independent, high-quality audits inhibit the falsification of corporate accounts and thus also help prevent balance sheet fraud and the economic instability that accompanies it.
In addition, courses and seminars will be held for the tax authorities in Latvia, Poland and the Czech Republic. They will focus on the question of how improved quality and transparency in accounting can be used to prevent tax evasion.
Transparent, high-quality and reliable accounting is also a pre-condition of investment: the use of international accounting standards makes companies more comparable and, in turn, simplifies decisions for international investors who are considering whether to invest in a certain company. Credible auditors are just as important: investors must be able to trust the statements in a company's annual accounts.