Institute of Certified Accountants of Montenegro

The Law on Auditing No. 001 of 2017 introduced the requirement to establish a mandatory quality assurance (QA) review system for all statutory audits in Montenegro, to be implemented by the Ministry of Finance under the oversight of the Council on Audit. The Council on Audit has carried out QA reviews since 2018.

The Institute of Certified Accountants of Montenegro (ICAM) does not have direct responsibility for the operation of the jurisdictional QA review system. However, given its role as the professional accountancy organization representing Certified Accountants and Certified Auditors, ICAM plays an important supporting role in promoting compliance with Statement of Membership Obligations 1 (SMO 1) and related quality management standards.

ICAM reports that it supports implementation of QA and quality management requirements through professional education, technical guidance, workshops, seminars, and continuing professional development activities for its members, including activities related to International Standard on Quality Management 1 (ISQM 1), International Standard on Quality Management 2 (ISQM 2), and relevant auditing standards.

ICAM also continues to engage with the Ministry of Finance and the Council on Audit on quality assurance matters and supports members in understanding inspection findings, professional standards, and remedial expectations arising from the QA review process. These activities demonstrate ongoing efforts to support the jurisdictional QA framework and reflect a mature best endeavors approach within the scope of ICAM’s authority.

Going forward, ICAM should continue to strengthen implementation support for members subject to inspections, including practical guidance on quality management systems, remediation of deficiencies, and alignment with evolving international quality management standards.

Current Status: Review & Improve

Initial and continuing professional development (IPD and CPD, respectively) requirements for Bookkeepers, Authorized Accountants, Certified Accountants, and Certified Auditors are established in the Montenegrin National Accounting Educational Standard, CORS-1, the Law on Accounting No. 052 of 2016, and the Law on Auditing No. 001 of 2017, and are implemented by the Ministry of Finance, the Institute of Certified Accountants of Montenegro (ICAM), and the Institute of Accountants and Auditors of Montenegro (IAAM).

Tertiary education is provided by universities and, according to the World Bank’s Accountancy Education: Benchmarking Study (2017), undergraduate and master’s degree programs compare well against the revised International Education Standards (IES) requirements effective at the time of the assessment. ICAM reports that it continues to work toward stronger integration between academic and professional accountancy programs to enable students to follow a more efficient pathway to qualification.

The Law on Accounting No. 052 of 2016 and CORS-1 establish IPD requirements for Certified Accountants and authorize the Ministry of Finance to oversee the certification process implemented by ICAM. ICAM developed its professional education and training program in line with CORS-1, which is based on the 2009 International Education Standards and was published in the Official Gazette of Montenegro in August 2014.

The Centre for Financial Reporting Reform (CFRR) of the World Bank has supported both the Government of Montenegro and ICAM in strengthening educational requirements. The World Bank’s 2017 benchmarking study concluded that ICAM’s program, which is based on the Association of Chartered Certified Accountants (ACCA) syllabus and program, incorporates most IES requirements related to IPD. However, the study also identified the need for a structured review and update of the program and teaching resources, particularly in areas such as governance, risk, ethics, advanced financial and performance management, and competency-based practical experience requirements.

ICAM reports that it is updating its IPD program to align with the latest revisions to IES 2, IES 3, and IES 4, effective January 2021, and continues to update its education and training framework to reflect new pronouncements issued by the International Auditing and Assurance Standards Board (IAASB) and the International Ethics Standards Board for Accountants (IESBA). The institute also reports ongoing efforts to strengthen members’ digital and information technology skills in response to evolving market expectations.

CPD for Certified Accountants is required under the Law on Auditing No. 001 of 2017 as prescribed by ICAM. ICAM’s CPD requirements follow both an input-based and competency-based approach in line with IES 7, and compliance is monitored. These activities demonstrate active implementation of Statement of Membership Obligations 2 (SMO 2).

Going forward, ICAM should focus on formally aligning CORS-1 and related education provider requirements with the latest IES, particularly IES 2, IES 3, IES 4, and IES 8, and strengthening competency-based practical experience assessment in line with the recommendations of the World Bank’s 2017 benchmarking study.

Current Status: Execute

The Law on Auditing No. 001 of 2017 requires all mandatory audits to be conducted in accordance with the International Standards on Auditing (ISA) issued by the International Auditing and Assurance Standards Board (IAASB) and adopted and published by the Ministry of Finance or a competent authority entrusted by the Ministry, which in this case is the Institute of Certified Accountants of Montenegro (ICAM).

ICAM has a formal agreement with the Serbian Association of Accountants and Auditors (SAAA) to access the Serbian translation of the standards for application in the jurisdiction. As of 2024, the Serbian translation of the 2016–2017 ISA remains the version available for use in Montenegro.

To support its members with implementation of ISA, ICAM: (i) develops and disseminates implementation guidance; (ii) raises awareness of the adopted standards; (iii) communicates recent updates and modifications to ISA through publications such as the ICAM journal and seminars; and (iv) incorporates ISA into its education, examination, initial professional development, and continuing professional development (CPD) programs while collaborating with other parties responsible for education requirements to ensure that current standard-related topics are reflected in professional training.

ICAM also offers technical courses and organizes annual knowledge-sharing and networking events to educate Certified Auditors on a range of audit-related topics. In addition, ICAM solicits members’ feedback on IAASB exposure drafts as part of its participation in international standard-setting processes. These activities demonstrate a mature and ongoing commitment to supporting implementation of Statement of Membership Obligations 3 (SMO 3).

Going forward, ICAM should continue strengthening implementation support for members and prioritize efforts to facilitate access to more recent translations of ISA to reduce the time lag in the availability of current standards in the jurisdiction.

Current Status: Review & Improve

The Law on Accounting No. 052 of 2016 and the Law on Auditing No. 001 of 2017 require Certified Accountants and Certified Auditors, the two legally protected designations in Montenegro, to comply with the International Code of Ethics for Professional Accountants (including International Independence Standards) issued by the International Ethics Standards Board for Accountants (IESBA).

The Ministry of Finance has delegated responsibility for adoption and publication of the Code to the Institute of Certified Accountants of Montenegro (ICAM). ICAM has a formal agreement with the Serbian Association of Accountants and Auditors (SAAA) to access the Serbian translation of the Code for application in Montenegro. As of the date of the assessment, the 2018 version of the Code remains the latest translated version formally available in the jurisdiction.

ICAM supports implementation of the Code through its qualification framework, professional education, continuing professional development (CPD) activities, seminars, technical publications, and guidance materials for members. The institute also communicates developments and amendments to the Code through member publications, training events, and technical sessions and integrates ethics-related content into initial and continuing professional education programs.

In addition, ICAM continues to raise awareness of revisions and exposure drafts issued by the IESBA and encourages members to participate in international standard-setting consultations. These activities demonstrate a well-established and ongoing commitment to supporting implementation of Statement of Membership Obligations 4 (SMO 4).

Going forward, ICAM should continue strengthening practical implementation support for members, including case-based ethics training and guidance on application of the latest amendments to the Code, while also working to reduce the time lag in the availability of updated translated versions.

Current Status: Review & Improve

Public sector accounting standards in Montenegro are established by the Ministry of Finance under the national public financial management framework. The Law on State Property of 2009, the Law on Financing of Local Self-Government of 2010, and the Law on Accounting in the Public Sector of 2019 govern public sector financial reporting. While the current framework continues to rely primarily on a modified cash basis, the 2019 law introduced accrual accounting through national standards that reference the International Public Sector Accounting Standards (IPSAS), with transition expected to begin in 2027.

The Institute of Certified Accountants of Montenegro (ICAM) does not have direct authority over the adoption of public sector accounting standards or the delivery of official public sector training, which remains within the mandate of the Ministry of Finance. However, ICAM reports that it supports awareness raising and capacity building relating to public sector accounting reforms and the eventual transition toward accrual-based standards.

ICAM continues to engage with relevant public sector stakeholders and supports professional awareness of IPSAS-related developments through seminars, technical events, and member communications. Where possible, ICAM also contributes technical expertise and promotes the adoption of international best practices in public sector financial reporting. These activities reflect ICAM’s ongoing best endeavors in support of Statement of Membership Obligations 5 (SMO 5).

Going forward, ICAM should continue engaging with the Ministry of Finance and other public sector stakeholders to support the planned 2027 transition to accrual accounting and strengthen professional capacity building in IPSAS-related subjects.

Current Status: Review & Improve

The Institute of Certified Accountants of Montenegro (ICAM) is authorized to investigate and discipline its members, including Certified Accountants and Certified Auditors, and reports that it has established an investigative and disciplinary (I&D) system aligned with the requirements of Statement of Membership Obligations 6 (SMO 6).

ICAM’s system comprises an Investigations Committee, Disciplinary Committee, and Appeals Committee, with clearly defined procedures for receiving, assessing, and resolving complaints. Upon receipt of a complaint, or awareness of potential non-compliance through other sources, the Investigations Committee reviews the matter, requests additional information where necessary, and determines whether the case should proceed to the Disciplinary Committee.

Where a case is pursued, the Disciplinary Committee determines the appropriate sanction, which may include reprimand, suspension, or expulsion from membership in cases of serious breaches of professional, ethical, or continuing professional development requirements. ICAM reports that it communicates the existence and functioning of its I&D procedures to members and supports awareness through training and professional guidance.

ICAM also monitors compliance with continuing professional development (CPD) requirements and uses its membership registry and compliance monitoring systems to identify potential non-compliance that may require disciplinary follow-up.

Compared with the jurisdictional framework and the SMO 6 benchmark, ICAM’s I&D system appears established and operational, with defined procedures and evidence of monitoring mechanisms. At the same time, continued strengthening of transparency, independence of committee composition, and public accessibility of complaint procedures and outcomes would further enhance the system. These activities demonstrate a mature and ongoing approach to implementation of SMO 6.

Going forward, ICAM should continue strengthening public transparency and independent oversight features of its I&D system and continue benchmarking its procedures against regional and international good practices.

Current Status: Review & Improve

The Law on Accounting No. 052 of 2016 requires legal entities in Montenegro to prepare financial statements in accordance with International Financial Reporting Standards (IFRS Accounting Standards) and International Accounting Standards (IAS) as adopted and published by the designated competent authority. The Ministry of Finance has delegated responsibility for the translation and publication of the standards to the Institute of Certified Accountants of Montenegro (ICAM).

ICAM supports implementation of IFRS Accounting Standards through translation arrangements, professional education, technical guidance, seminars, workshops, and continuing professional development (CPD) activities for its members, including Certified Accountants and Certified Auditors. The institute also disseminates updates on new and amended standards through its journal, technical publications, seminars, and member communications.

ICAM reports that it incorporates IFRS Accounting Standards into its qualification framework, examination process, and continuing education programs and works with universities and other education providers to promote alignment between academic and professional education requirements.

In addition, ICAM continues to monitor developments issued by the International Accounting Standards Board (IASB) and supports awareness of recent amendments and exposure drafts through technical sessions and member outreach. These activities demonstrate a mature and ongoing commitment to implementation support under Statement of Membership Obligations 7 (SMO 7).

Going forward, ICAM should continue strengthening practical implementation support for members and work with relevant stakeholders to reduce the time lag in the translation and availability of the latest IFRS Accounting Standards in the jurisdiction.

Current Status: Review & Improve