The key findings and recommendations of the Accounting and Auditing Report on the Observance of Standards and Codes Update (A&A ROSC) for Bosnia and Herzegovina were discussed at a workshop hosted by the World Bank in Sarajevo on 27 June 2011.
Pascal Frèrejacque, who led the World Bank team that prepared the A&A ROSC report explained: "A strengthened corporate financial reporting framework will foster private and financial sector development in Bosnia and Herzegovina, as well as restoring investors' trust and confidence, which is so much needed to economic growth."
The state and Entity-level ministers of finance praised the quality of the report and its recommendations and reiterated their commitment to pursuing the reforms needed for Bosnia and Herzegovina to meet the obligations of the EU acquis in financial reporting.
As Bosnia and Herzegovina is a potential candidate for EU accession, it will need to continue transposing the EU acquis communautaire into its domestic laws and regulations before it can join the EU. The report finds that good progress that has been made at both state and Entity levels in aligning their laws with the acquis, but that several challenges still need to be resolved. In particular, further work is needed to implement an effective and relevant accounting framework for small- and medium-sized enterprises (SMEs) and to develop a system of quality assurance and public oversight for external audits.
Ms. Sehija Mujkanovic, representative of the Bosnia and Herzegovina Ministry of Finance and Treasury said: "I would like to express our gratitude to the World Bank team of experts involved, during 2010, in the preparation of this report, for their effort related to the complex analysis of various accounting and audit issues and also for their professional recommendations aimed to improve the quality of financial reporting in Bosnia and Herzegovina."
As a sign of their commitment to further reform, the ministries of finance in the two Entities are currently preparing amendments to the laws governing accounting and auditing in order to better meet the needs of SMEs.
Henri Fortin, the Head of the CFRR, suggested: "To ensure transparency BH should implement rapidly IFRS for SMEs in a way that can be compatible with the EU acquis."
The workshop was attended by 50 participants, including ministers and assistant ministers of finance from both state and Entity levels; the vice-governor of the central bank, representatives from financial regulators at state and Entity levels, audit firms operating in Bosnia and Herzegovina and members of local accounting and auditing professional bodies.