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International Financial Reporting Standards (IFRS) present the best model available, say regulators, standard setters, business and professional bodies in Latvia.

Participants of the First Baltic IFRS Adoption and Implementation Forum that took place on 18 March 2009 in Riga, Latvia, agreed that in the current economic conditions, once set of transparent and reliable international accounting principles is essential, though there are regional discrepancies and issues in regards to its adaptation and implementation.

For the first time IFRS implementation in Baltic States was discussed on the highest level, involving standard setters, regulators, business, international audit companies, professional bodies, and educators, at the First Baltic IFRS Adoption and Implementation Forum.

Forum was organized by the Latvian Business School, ACCA CPD provider.

Forum was opened by HE Ambassador of UK to Latvia Dr. Richard Moon. In his welcoming address Dr. Richard Moon said:

"In the current global climate, potential investors and business partners are looking more closely than ever at the opportunities at potential challenges which might arise in specific countries. This is where international financial reporting standards have a vital role to play because they provide a global measurement by which stakeholders can make important business judgements. These initial discussions have important implications not only for Latvia but all Baltic states, and I am delighted that this event, organized with the assistance of ACCA - the global body for professional accountants - will start the debate.”

Michael Wells, Director of IFRS Education Initiative, International Accounting Standards Committee Foundation, talking about the response of International Accounting Standards Board (IASB) to the credit crisis, stated:

“The International Accounting Standards Board is reviewing accounting issues emerging from the global financial crisis, including those identified by the G20 and other international bodies. Specifically, according to short-term action plan, governance of IASC Foundation is to be further enhanced, standard setters to enhance guidance for valuation of securities and complex, illiquid products. Standard setters have also to address weaknesses in accounting for off-balance sheet vehicles”.

Latvian legal system and tradition is not sufficiently flexible to allow for instant changes of Latvian Accounting Standards, says Kristine Potapoviča, Board Member, Latvian Association of Certified Auditors:

“Rapid developments of IFRS and limited resources of the Accounting Council cause difficulty to follow, resulting in increasing number of differences between Latvian Accounting Standards and IFRS”.

Richard Martin, Head of Financial Reporting, ACCA, said, that according to the recent CFO survey conducted for ACCA, polling 790 CFO’s worldwide, 70% of respondents stated that use of IFRS is benefiting their companies, or would benefit. Among the benefits of IFRS are: credibility for financial statements, easier to operate globally, improved consistency in markets, easier access to finance, reduced compliance costs, internal cost savings.

Dr. Nataliya Vovchuk, Head of ACCA Ukraine, Baltic and Caucasus States, informed on the importance of professional accountancy education, increasing capacity of business to work under IFRS:

“Educational system needs to increasingly react on transformation of profession – therefore examination on IFRS should be essential part of accounting qualification”.

The Forum also featured the workshop, led by Wojciech Krynski, Managing Director of BPP Poland, familiarizing participants with key changes and revisions of IFRS on a high level, that took place recently or planned in the future. The amendments and changes were discussed to explain their impact on financial reporting from both operational and financial perspective. The influence on the financial position and performance of reporting entities were discussed to enable the participants to appreciate how the reports of companies will be evolving over the near future.

Alexander Lebedev, President of Latvian Business School, stated the current economic situation gives opportunity to look at the processes from the different angle, analyze mistakes and rethink some concepts, including in financial reporting: “This Forum is an excellent opportunity for professionals to get together, discuss current issues and listen to the point of view of experts”.

Please view some photos from the event.

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