IFRS adoption in Cambodia 8 th Floor, VTRUST Tower, St. 196, Sangkat - PowerPoint PPT Presentation

វិទ្រាស្ទ ា នគណននយ៓យករជំនិញនិងសវនករកម៓ពុជិ KAMPUCHEA INSTITUTE OF CERTIFIED PUBLIC ACCOUNTANTS AND AUDITORS IFRS adoption in Cambodia 8 th Floor, VTRUST Tower, St. 196, Sangkat Veal Vong, Khan 7 Makara, Phnom Penh Tel. 855 23 23 17 07, email: kicpaa@kicpaa.org; www.kicpaa.org

Agenda INSTITUTIONAL DEVELOPMENT CHALLENGES 01 04 05 COOPERATION REGULATORY BODIES 02 OPPORTUNITY 06 KEY MILESTONES 03

INSTITUTIONAL DEVELOPMENT 1999 2002 2003 2016 2017 2019 Kampuchea Research Law on - NAC Law on National Institute of Committee for Accounts, Their - KICPAA Accounting and Accounting Certified Public International Audits, and Auditing Council Accountants and Accounting Accounting Auditors (KICPAA) Standards Profession

REGULATORY BODIES OF ACCOUNTING AND AUDITING KAMPUCHEA INSTITUTE OF NATIONAL ACCOUNTING COUNCIL CERTIFIED ACCOUNTANTS AND AUDITORS (KICPAA) 4

KEY MILESTONES 1 st delay adoption CIFRS for SME first set of for financial become effective CIFRS being institutions and prepared insurance to 2016 28 Aug 2009 1 Jan 2010 1 Jan 2012 30 Jun 2012 26 Feb 2016 2019 2 nd delay adoption CIFRS become MEF-NAC for financial announced to adopt effective institutions and IFRS and IFRS for general insurance SME to 2019 www.free-powerpoint-templates-design.com

CHALLENGES ENTITY ▪ Big gaps between local GAAP (CAS) and IFRS. ▪ Extensive resources are need to implement IFRS, including: ➢ People: ✓ limited IFRS knowledge amongst local stakeholders including accounting and finance team. ✓ Most entities have to engage external expert to help them with their IFRS conversion. ✓ Lack of local expert in the country. ➢ Process: Entities have to modify their processes in order align with IFRS requirement ➢ System: investment in system to cope with changes in the process and the data requirement for IFRS number and reporting. ➢ Data extraction ➢ Function ➢ Modeling ➢ Reporting

CHALLENGES ( con’t ) REGULATORS ▪ Similar to entity: people, process and system. ▪ Unfamiliar with the new accounting standards. ▪ Need to balance between accounting standards and prudential requirements. ▪ Impacts of new accounting standards require the update of regulations.

CHALLENGES ( con’t ) AUDITORS ▪ Increase cost of each IFRS audit assignments. ▪ Additional involvements and works due to client ’ s lack of IFRS understanding. ▪ Lack of resources locally in particular IFRS 9 adoption. ▪ Additional training requirements.

COOPERATION ▪ Various IFRS training are conducted either through KICPAA CPD and NAC ▪ Members of KICPAAA mainly big 4 are working directly with NAC and NBC on the training and sharing experience in the workshop ▪ IFRS working committee as established by standard setter, NAC, with KICPAA’s member are also part of them ▪ Member firms are also assist regulator in developing and reviewing the new chart of account for Financial Institutions ▪ Member firms are actively in joining public consultation relating to IFRS.

OPPORTUNITY ▪ Data as of August 2019, Cambodia have 46 commercial banks, n 15 specialized banks, 7 MDIs, 75 MFIs and 15 Leasing companies that require to adopt IFRS and IFRS for SMEs. ▪ We have less than 100 qualified accountants with ACCA or CPA ▪ IFRS 9 and IFRS 16 are generally sourced from other country. Mostly from Singapore and Malaysia.

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