Cabinet approves AASBB

The 69th session of the Lhengye Zhungtshog approved the Accounting and Auditing Standards Board of Bhutan (AASBB) to strengthen accounting and auditing practices in Bhutan. The board has nine members from various stakeholders, including representations from private, corporate, education and government sectors with the Auditor General of Bhutan as the chairperson.

Ugyen Tshewang, the auditor general, said the present system of accounting and auditing was a mix of various standards, thereby not complying with any particular set of standards. He said that the government and RAA have rules that govern accounting and auditing standards but the public and private sectors lack a uniform standard. The formation of the AASBB was formally inaugurated by the finance minister on July 26.

The AASBB will be the nerve centre and key mover for all reforms related to improvement of accounting and auditing standards in Bhutan. The board will set Bhutanese auditing and accounting standards in line with international standards, develop plan for the formation of chartered institute and chartered accountants qualification in Bhutan and harmonize financial reporting formats. The benefits of aligning with the international standards are many, which includes greater comparability of financial information for investors, greater willingness on the part of investors to invest across borders and elimination of multiple reports.

The auditor general said that, since the government had embarked upon a new foreign direct investment policy, setting up standard accounting and auditing would help potential investors gain confidence in the private and corporate sectors. Financial reporting is also a building block of a market-based monitoring of companies which allows shareholders and the public at large to assess management performance, thus influencing its behavior. High quality financial reporting contributes to strengthening the financial discipline of state-owned enterprises Currently, over 109 countries worldwide have agreed to adapt to international financial reporting standards by 2013 or 2014. In the next few years, the AASBB will issue Bhutanese accounting standards, provide trainings on IAS/AFRS to the companies to facilitate implementing the standards and work on developing professional accountancy education in Bhutan.

Feb 07, 2014    News    Admin

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