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12 May 2006
Improved Accounting Promotes Investment in Eurasia
Partnership for a Better Life
In the former Soviet Union, people could be sent to jail for selling goods for more than the cost of production – an act officially designated "profiteering." Bookkeepers and formal accountants tracked quantities of goods and materials, not costs or income. Such basic concepts as profit, loss, depreciation and other modern accounting standards virtually were unknown when the region began its transition to a market system.
The use of old Soviet-style accounting principles and the lack of accountants skilled in international accounting principles has discouraged foreign investment and slowed the region’s integration into the global economic community.
An international alliance of the world’s leading accounting organizations is working to change that. In partnership with the U.S. Agency for International Development (USAID), the Certified International Professional Accountant (CIPA) Alliance and professional accounting associations across Eurasia are promoting international standards, practices and principles of accounting in the region.
By developing and offering training, examination and certification of professional accountants in local languages, the alliance is improving the business environment for U.S. and European investors, facilitating regional economic harmonization and furthering the integration of former Soviet republics into today’s global economy.
Since the early 2000s, more than 50,000 CIPA courses have been taught and more than 3,000 accountants in Eurasia have earned practitioner status.
"Enterprise accountants and financial market regulators throughout the former Soviet Union need international financial reporting standards in order to serve new investors and showcase their skills in the global marketplace. Our partnership with USAID is what makes this possible," said Kurt Ramin, director of the International Accounting Standards Board. Having good accounting will help discourage corruption, too.
The program also has the support of the United Nations Conference on Trade and Development and the Thunderbird Center for Business Skills Development.
(Distributed by the Bureau of International Information Programs, U.S. Department of State. Web site: http://usinfo.state.gov)
