Progress of Financial Reporting Assistance Project

1. Progress of the Financial Reporting Technical Assistance ProjectAnnual meeting on the Latvian-Swiss Cooperation Programme, Riga, 25 April 2013

2. Activities implemented during the reporting period (I) Comprehensive International Financial Reporting Standards (IFRS) training • the training was delivered on 12 days between 20 November and 28 December, 2012 • 30 representatives from the Ministry of Finance (MoF), the State Revenue Service (SRS) and the Treasury participated in the IFRS training • the participants of the training were satisfied with the quality of the training, the training materials provided and the instructors who delivered the training Conference "IFRS: changing landscape, practical solutions for businesses and investors in Central and Eastern Europe", 6 December 2012, Warsaw • 4 representatives from the MoF, the SRS and the Financial Capital Market Commission participated in a IFRS conference • the conference programme provided participants with an opportunity to work on a practical case study involving the application of IFRS as well as to hear updates on current developments from high level speakers from the International Accounting Standards Board, the European Securities and Markets Authority and Polish practitioners and regulators

3. Activities implemented during the reporting period (II) Study Visits to the bodies responsible for public oversight of auditors and external quality assurance inspections in Switzerland and the Netherlands (10-11 December, 2012 and 13-15 March, 2013) • participated representatives with audit oversight and quality assurance responsibilities from the MoF and the Latvian Association of Sworn Auditors (LASA) (four people participated in the study visit to Switzerland and five people – to the Netherlands) • study visits provided opportunity for participants to learn from the experiences of the Swiss Federal Audit Oversight Authority, the Netherlands Authority for the Financial Markets and the Netherlands Institute of Chartered Accountants • the participants were able to share experiences with their counterparts in other participating the Financial Reporting Technical Assistance Program countries, including Poland, Slovenia and the Czech Republic

4. Difficultiesin project implementation and proposals for new activities (I) Delay in project implementation • one year left for implementation of project’s activities • financial completion of project 26% • decision to hire a project manager Audit software • the World Bank Centre for Financial Reporting Reform, the LASA and the MoF continued to explore how Descartes Audit Software System could be implemented in the Latvian language for use by Latvian practitioners • the pricing of licences is a significant factor that influence the level of demand for the software • despite continuing discussions among the parties, agreement on how to move forward either with Descartes Audit Software System or with other possible alternatives had not been reached

5. Difficulties in project implementation and proposals for new activities (II) Changes in relation to Translation activity • the LASA has informed the MoF that current Latvian language version of International Standards on Auditing is good enough and there is no need to revise it • the LASA has asked for possibility to translate the Guide to Using International Standards on Auditing in the Audits of Small- and Medium-Sized Entities (prepared by the Small and Medium Practices Committee of the International Federation of Accountants)instead • the MoF fully supports the proposal of the LASA and will propose appropriate amendments in the project

6. Thank you for attention! Ministry of Finance of the Republic of Latvia 1 Smilšu Str. Riga, LV – 1919 Phone.: +371 67095517 E-mail: Jana.Salmina@fm.gov.lv