Armenia`s ministry of finance satisfied with auditing reforms 

ArmInfo. High-quality audit services cannot be cheap. This was stated by Deputy Minister of Finance of Armenia Arman Poghosyan on February 10 at a meeting of the parliamentary committee on financial and budgetary commission, answering a question from opposition MP from the Hayastan faction Artur Khachatryan about how much more expensive audit services have become after the reforms initiated by the Cabinet of Ministers.

Thus, Artur Khachatryan recalled that earlier the government of  Armenia, represented by the Ministry of Finance and the Ministry of Economy, initiated legislative changes in the field of auditing.

Audit companies licensed by the Ministry of Finance were required to undergo a certification process, which caused discontent among representatives of the field, but they were not listened to, he added.

In response, the Deputy Minister of Finance noted that the concern was not so much among audit companies, but among individual auditors who had received their qualifications from the Ministry of Finance 10 years ago, or perhaps more, and without undergoing an additional knowledge assessment procedure, they applied to be members of the newly created Chamber of Auditors and Accountants. At the same time, Pogosyan noted, the Ministry of Finance met them halfway, allowing them to become members of the Chamber in a simplified manner.  However, to our surprise, we did not wait for the corresponding  reaction, he noted.

Meanwhile, our number one task is to ensure quality. And quality without knowledge is not possible>, he emphasized.

As the representative of the Ministry of Finance pointed out, today 135-140 thousand business entities are actively operating in Armenia, and only 550 of them are required to undergo mandatory audit. These are large companies and those that, regardless of their size, have public significance (in accordance with Article 26 of the RA Law , adopted on December 4, 2019, the following are subject to mandatory audit: organizations representing public interest; large organizations; medium-sized organizations; a group whose parent organization represents public interest; large groups; medium-sized groups - ed.).

Nevertheless, Poghosyan is convinced that there is no direct  correlation between the reform and the rise in the cost of audit  services. The connection can be traced between the improvement in quality and the increase in price. In any case, the Ministry of Finance is satisfied with the results of this reform, he pointed out.

"It should be noted that the Law On Accounting was adopted in 2002. Subsequently, it was repeatedly amended. The concept of reforms in the sphere was approved on December 28, 2017. As indicated by the Ministry of Finance in 2018, as a result of legislative reforms, it is planned to create two independent structures regulating accounting and auditing activities, to which a number of powers will be delegated, as well as the introduction of new standards stimulating the development of the sphere. According to the bill, examinations and certification of auditors and accountants will no longer be carried out by the Ministry of Finance, but by the Chamber of Auditors and Accountants, which is proposed to be created on the basis of the Association of the same name, which will function at the  expense of membership fees. The state will control the Chamber through a Council of 7 people. 4 people are delegated there from the Ministry of Finance, 2 from the Central Bank, 1 from specialized public organizations. The organization, in particular, will carry out activities aimed at improving the professional capabilities of auditors and accountants through certification and quality supervision. As part of the legislative reforms, it was also planned to revise the process of licensing auditors by introducing a new system of recording the Register of Audit Organizations.