OREANDA-NEWS. January 26, 2011.  The accounting reform programme was launched in Turkmenistan last July in order to enhance efficiency of the national monetary and credit policy.

This programme stipulates that all enterprises, institutions and organisations irrespective of the form of ownership (except for banks) are to ensure phase transition of the national accounting and auditing system to the international financial reporting standards (IFRS) starting from 1 January 2013 and full transition starting from 1 January 2014. The banking institutions in the country are to ensure the IFRS transition starting from 1 January 2011, draw up financial reports for 2011 in compliance with international standards and ensure conducting financial statement audit on a yearly basis in compliance with international standards starting from 2011.

Muhammet Nurmyradov, Head of the Department for Accounting and Reporting Methodology of the Ministry of Finance of Turkmenistan tells about key aspects of accounting and auditing reform programme in Turkmenistan:

“IFRS transition is an objective necessity under conditions of rapid development of a market economy in Turkmenistan and the country’s integration into the global economic system. The reform of the national financial reporting system is an important prerequisite for increasing efficiency of the national monetary and credit policy, facilitating Turkmenistan’s integration into the global economic system and intensifying partnership with foreign companies and investors.

“The measures aimed at updating regulatory documents on financial reporting, develop and introduce accounting standards and the standards for financial and economic activity of economic entities will enable to fulfil the tasks, including phase transition to international financial reporting and audit standards. The existing methods for recording cost of goods (works, services) sold and their structures to bring them in compliance with international standards, calculating depreciation expenses to fixed assets and applying accelerated depreciation are needed to be revised. IFRS is an instrument developed and updated as to conform with best accounting methods applied in developed countries and obtain the data on the financial activity, financial position and movements in shareholders’ funds of economic entities in order to facilitate managerial decision-making and transfer the required information to users.

“The full set of financial statements as consistent with IFRS should include statement of financial position (balance sheet) at, statement of comprehensive income (profit and loss statement), statement of movements in shareholders’ funds, cash flow statement, statements of change in accounting principle and explanatory note.

“The accounting and auditing reform programme in Turkmenistan provides for improvement of the regulatory framework and personnel training. In particular, the draft Law of Turkmenistan “On Accounting and Financial Reporting in Turkmenistan” takes best international practices into account.

“Professional training, retraining and advanced training of accountants will be enhanced through training accountants at educational institutions and using training materials of international organisations, which provide consultative assistance. Training centres providing training on a regular basis will be opened in the near future. IFRS incorporation in the national economy requires widening cooperation with international organisations. For this purpose experts of international organisations will be invited, consultations will be provided and study tours to foreign countries will be organized for our specialists.”