Jordan

Member Organizations

Member Organization Associate Other PAOs

  International Arab Society of Certified Accountants
  Jordanian Association of Certified Public Accountants

Legal and Regulatory Environment

  • Overview of Statuatory Framework for Accounting and Auditing

    Companies Law No. 22 of 1997 governs the corporate financial reporting framework in Jordan, mandating the preparation of financial statements by all entities. All companies are required to have an annual statutory audit except for limited and general partnerships having capital of less than 100,000 Jordanian dinars. The Law further stipulates that the financial statements of public and private shareholding companies, as well as limited liability companies, must be prepared in accordance with “recognized international accounting standards,” which has been interpreted and applied as the use of IFRS as issued by the IASB. Law No. 73 of 2003 on Organizing the Practice of the Public Accounting Profession (Accountancy Law 2003) authorizes the Jordanian Association of Certified Public Accountants (JACPA) to recommend auditing standards to be adopted by the Higher Committee of the Accountancy Profession (HCAP). JACPA recommended the adoption of ISA as issued by the IAASB for financial statement audits, and the HCAP approved the use of the standards.

    In addition to the requirements established in the Companies Law and the Accountancy Law 2003, Banking Law No. 28 of 2000, Securities Law No. 76 of 2002, and Insurance Regulatory Act No. 33 of 1999 outline financial reporting requirements for banks, other financial institutions, listed entities, and insurance companies. In accordance with these Laws, and the regulations and instructions arising from them, regulated entities are required to have their financial statements prepared in accordance with IFRS as issued by the IASB. The Central Bank of Jordan maintains a list of auditors who are authorized to conduct audits of banks’ financial statements.

  • Regulation of Accountancy Profession

    Accountancy Law 2003 empowers the Higher Committee of the Accountancy Profession (HCAP) and the Jordanian Association of Certified Public Accountants (JACPA) to regulate the accountancy profession in Jordan. The HCAP recognizes professional accountancy organizations in the country and approves the granting or revocation of Certified Public Accountant (CPA) licenses. It is also responsible for adopting the auditing and ethical standards that the JACPA recommends. Accountancy Law 2003 defines the requirements for initial professional development (IPD) and continuing professional development (CPD) requirements, while the country’s universities and the Ministry of Higher Education and Scientific Research share responsibility for developing the university accounting or business degree curriculum.

    The JACPA is tasked with oversight of the IPD requirements stipulated in Accountancy Law 2003, including administration of the professional certification examinations and the verification of practical experience requirements. Candidates fulfilling all legal conditions are awarded the CPA designation, subject to HCAP approval and being a JACPA member. In addition, the JACPA, which has the authority to create its own by-laws, has instituted CPD requirements for its members. The JACPA also plays a standard-setting role as Accountancy Law 2003 requires it to recommend auditing and ethical standards to the HCAP. The association is tasked with the establishment of an investigative and disciplinary system and has the power to sanction members for non-compliance with its by-laws. Although, it does not have the authority to establish and operate a quality assurance review system, under Accountancy Law 2003, it can inspect its member’s working papers.

    The International Arab Society of Certified Accountants determines certification and CPD requirements for the two voluntary designations that it offers: International Arab Certified Public Accountant and International Arab Certified Management Accountant.

  • Audit Oversight Arrangements

    There are no independent audit oversight arrangements in Jordan. The oversight functions of the Higher Committee of the Accountancy Profession under Accountancy Law 2003 include providing confirmation and revocation of CPA licenses and adoption of audit and ethics standards. Other regulatory functions, such as monitoring and enforcing ethical requirements, is carried out by the Jordanian Association of Certified Public Accountants.

  • Professional Accountancy Organizations

    There are two professional accountancy organizations in Jordan:

    The International Arab Society of Certified Accountants (IASCA)

    The IASCA was established in 1984 in the United Kingdom as a non-profit professional accounting association, and was formally registered in Jordan in 1994 by the Ministry of Industry and Trade as the Arab Society of Certified Accountants. Although registered in Jordan, the association operates as a regional accountancy organization in the Middle East, and comprises solely individuals from academia and the public and private sectors. The IASCA is an organization with voluntary membership with a mission to enhance the professional and technical competence of the accountancy profession in the Arab world. It offers various certification schemes to fulfill its mandate.

    In addition to being a Member of IFAC, the IASCA is a member of the International Committee for Accounting Education and Research.

    The Jordanian Association of Certified Public Accountant (JACPA)

    The JACPA was established in 1988 in accordance with Law No. 42 of 1987. Membership in JACPA is mandatory for accountants and auditors. Its functions include advising on standard setting; ensuring that its members comply with the laws governing the profession, the association’s by-laws and ethical requirements; providing education and training to the accountancy profession; and promoting the interest of the profession.

    JACPA is a member of IFAC.

  • Projects or Other Information

    The Jordanian Association of Certified Public Accountant is in the process of designing a quality assurance review system under a World Bank-financed grant, as it awaits approval for an amendment to Accountancy Law 2003 that would grant it the authority to operate the system. Also, the Ministry of Finance launched a five-year plan to implement IPSAS in the public sector in 2015 with assistance from the United States Agency for International Development.

Adoption of International Standards

  • Quality Assurance

    There is no mandatory quality assurance (QA) review system in Jordan. The Jordanian Association of Certified Public Accountants (JACPA) is promoting amendments to Accountancy Law 2003, which would grant it the authority to design and implement a QA review system. The draft amendments are pending approval of the Parliament. In addition, the JACPA has started the process of designing a QA review system under a World Bank project to strengthen the profession.

    The International Arab Society of Certified Accountants does not have a QA review system in place for its members in Jordan.

    Current Status: Not Adopted

  • International Education Standards

    The Ministry of Higher Education and Scientific Research (MOHESR), universities, the Jordanian Association of Certified Public Accountants (JACPA), and the International Arab Society of Certified Accountants (IASCA) are involved in developing and providing initial professional development (IPD) and continuing professional development (CPD) of professional accountants in Jordan. The extent of adoption of the IES IPD and CPD requirements is unclear.

    Accountancy Law 2003 defines the requirements for IPD and CPD, and gives the universities and MOHESR shared responsibility for the university accounting or business degree curriculum. The JACPA and the IASCA oversee and administer professional certification examinations, practical experience requirements, and CPD requirements for their members.

    The JACPA has adopted most of the IES requirements for its members, and continues to promote and support adoption as part of ongoing legal reforms.

    The IASCA states that the syllabus and training programs that support the professional designations that it confers—the International Arab Certified Public Accountant, the International Arab Certified Management Accountant, and the IFRS Expert—are aligned with revised IES.

    The IASCA translated the 2015 version of the Handbook of International Education Pronouncements into Arabic and is in the process of translating the 2017 version.

    Current Status: Partially Adopted

  • International Standards on Auditing

    Companies Law No. 22 dated 1997 and Accountancy Law 2003 authorize the Jordanian Association of Certified Public Accountants (JACPA) and the Higher Committee of the Accountancy Profession (HCAP) to specify applicable auditing standards in Jordan. Under Accountancy Law 2003, the JACPA is responsible for recommending the auditing standards the HCAP is to adopt. In 1992, the HCAP adopted all ISA as issued by the IAASB for current and future audits.

    The JACPA uses the Arabic translation produced by the International Arab Society of Certified Accountants (IASCA). The IASCA translated the 2016–2017 Handbook of International Quality Control, Auditing, Review, Other Assurance, and Related Services Pronouncements into Arabic.

    Current Status: Adopted

  • Code of Ethics for Professional Accountants

    In accordance with Accountancy Law 2003, the Jordanian Association of Certified Public Accountants (JACPA) is responsible for recommending the ethical requirements for professional accountants that the Higher Committee of the Accountancy Profession (HCAP) is to adopt. In 1992, the HCAP adopted the IESBA Code of Ethics for Professional Accountants. All revised and new requirements of the IESBA Code are applicable in Jordan with the effective date issued by the IESBA.

    The JACPA uses the Arabic translation produced by the International Arab Society of Certified Accountants (IASCA). The IASCA translated the 2016 Handbook of the Code of Ethics for Professional Accountants and requires its members to adhere to this Code.

    Current Status: Adopted

  • International Public Sector Accounting Standards

    The Ministry of Finance is responsible for the adoption of public sector accounting standards in Jordan and, in 2015, officially endorsed the adoption and implementation of IPSAS. A five-year IPSAS implementation road map is in place, with implementation assistance coming from the United States Agency for International Development under Jordan’s Fiscal Reform Project. Currently, public sector accounting standards are prepared using a modified cash-basis accounting system.

    The International Arab Society of Certified Accountants reports that it will complete the translation of the 2016 Handbook of International Public Sector Accounting Pronouncements in November 2017.

    Current Status: Partially Adopted

  • Investigation and Discipline

    The Jordanian Association of Certified Public Accountants (JACPA) has the authority to discipline professional accountants in accordance with Accountancy Law 2003. The association states that it cooperates with the Jordanian Courts to operate an investigative and disciplinary (I&D) system. In addition, the JACPA indicates that it must seek approval from the Higher Committee of the Accountancy Profession to enforce certain penalties, such as expulsion from membership. The JACPA is in the process of updating its I&D system to ensure that all of the revised SMO 6 requirements have been adopted. This is being done as part of the proposed reform of Accountancy Law 2003.

    The International Arab Society of Certified Accountants (IASCA) established its own I&D system for its members. The IASCA completed a self-assessment of its I&D system and confirmed that its system incorporates the main requirements of SMO 6.

    Current Status: Partially Adopted

  • International Financial Reporting Standards

    The accounting standards that must be applied in Jordan are outlined in various laws and instructions, which include Companies Law No. 22 of 1997, Banking Law No. 28 of 2000, Securities Law No. 76 of 2002, and Insurance Regulatory Act No. 33 of 1999. The laws and instructions do not assign standard setting responsibilities to an institution or body.

    All public and private shareholding companies, limited liability and foreign companies operating in Jordan are required to use IFRS as issued by IASB. In addition, entities regulated by the Central Bank, and the Securities and Insurance Commissions, must apply IFRS for financial statement preparation. IFRS for SMEs has not been adopted.

    The 2015 version of IFRS was translated into Arabic through the IFRS Foundation. The International Arab Society of Certified Accountants indicates in its SMO Action Plan that it is licensed by the Foundation to translate the standards into Arabic and that it is in the process of translating the 2016 version of IFRS and the 2010 version of IFRS for SMEs.

    Current Status: Adopted

Disclaimer

IFAC bears no responsibility for the information provided in the SMO Action Plans prepared by IFAC member organizations. Please see our full Disclaimer for additional information.

Methodology

Methodology
Last updated: 12/2017
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