Expert Accountants' Association of Turkey

The EAAT is not responsible for establishing a quality assurance (QA) review system; however, it reports that it has been supporting the Public Oversight, Accounting and Auditing Standards Authority (KGK) and the Union of Chambers of Certified Public Accountants of Turkiye (TÜRMOB) with the implementation and results of their respective quality assurance review systems, which both align with SMO 1 best practices.

EAAT and TÜRMOB have a QA Taskforce and through this taskforce, EAAT and TÜRMOB develop related training programs and maintain communication with the KGK. Together the PAOs have completed a translation of the quality management standards and have disseminated guidance for implementation to their members.

In addition, EAAT reports that it participates in recruiting members to become QA reviewers.

Current Status: Sustain

Members of EAAT are first required to meet education requirements as prescribed by TÜRMOB and then fulfill additional requirements set by EAAT, by submitting a dissertation paper and passing an oral examination with its membership committee. EAAT awards the Expert Accountants Certificate to members, which is a privileged qualification but does not give its holder any practicing rights and is more academic in nature.

EAAT reports that it works closely with TÜRMOB and supports the Public Oversight, Accounting and Auditing Standards Authority (KGK) in activities related to professional education. EAAT indicates that TÜRMOB’s requirements were updated to reflect revisions from the 2019 IES and that it monitors discussions held by the International Panel on Accountancy Education.

EAAT members are required to complete 120 hours of Continuous Professional Development (CPD) each year and offers a CPD calendar. It applies an input-based approach. EAAT monitors if its members are fulfilling the CPD obligations set by the institute, TÜRMOB, and the KGK as appropriate.

Current Status: Sustain

The Public Oversight, Accounting and Auditing Standards Authority’s Organization and Responsibilities Statutory Decree No. 660 states that auditing and assurance standards are issued by the KGK under the title of Turkish Auditing Standards (TDSs). KGK has published national standards complying with ISAs issued by IAASB with small amendments to take into consideration the Turkish environment.

EAAT states that its role is to promote full convergence with ISA and to support its members with the implementation of the standards through trainings and other educational activities. Additionally, EAAT focuses on supporting the Union of Chambers of Certified Public Accountants of Türkiye (TÜRMOB) in the translation of the IAASB pronouncements, the operation of the quality assurance review system that ensures proper implementation of ISA, providing an ISA Guide for Small and Medium Practices, and offering educational and training courses that incorporate ISA requirements. EAAT provides a link on its website to the KGK’s dedicated page on auditing standards.

Additionally, EAAT collaborates with academics to prepare and publish articles on ISA and related topics and disseminate new and revised IAASB pronouncements. Lastly, EAAT reports to obtain comments from technical experts to comment on IAASB exposure drafts.

EAAT has demonstrated an ongoing process to maintain its fulfillment of the SMO 3 obligations and is committed to continuous improvement.

Current Status: Sustain

The Public Oversight, Accounting and Auditing Standards Authority’s Organization and Responsibilities Statutory Decree No. 660 authorizes the Public Oversight, Accounting and Auditing Standards Authority (KGK) to issue ethical standards in compliance with international standards for auditors. The KGK presently requires adherence to the latest version of the Handbook which as of the date of this assessment is the 2024 International Code of Ethics (available here on the KGK website).

TURMOB, which is a mandatory membership organization for CPAs and Sworn-in CPAs (including all EAAT members), requires adherence to the IESBA Code as issued by IESBA, which is the 2024 Handbook released in August 2024.

Through its training and website, EAAT provides members with access to updates, resources, and guidance about the IESBA Code of Ethics.

EAAT also supports member participation in the international standard-setting process by soliciting comments on IESBA Exposure Drafts.

Current Status: Sustain

The Public Financial Management and Control (PFMC) Law of 2006 requires the Government of Türkiye to adopt international accounting standards in the public sector. The Central Government is implementing accrual-basis IPSAS, modified for the local context (IFAC, CIPFA).

While EAAT has no direct authority for the adoption of public sector standards in Turkiye, it reports to participate in the Public Accounting Standards Board of Turkey (DMSK) work program committee and encouraging the regulator to submit comments on Exposure Drafts issued by IPSASB. Additionally, it has been working with TÜRMOB to encourage relevant authorities to maintain an ongoing process to translate the most recent version of IPSAS into Turkish in accordance with IFAC Translation Policy as part of the DMSK standard-setting process.

EAAT has demonstrated an ongoing process to maintain its fulfillment of the SMO 5 obligations and is committed to continuous improvement.

Current Status: Review & Improve

All EAAT members are subject to at least the Union of Chambers of Certified Public Accountants of Turkiye (TÜRMOB)’s enforcement system, which embodies the requirements of SMO 6 and in accordance with the Professional Law No: 3568 and Disciplinary Regulation. Its members might also be subject to sanctions by the KGK if they are auditors.

EAAT has a Disciplinary Board for its members, comprising the EAAT President and three members. It mostly functions to apply any sanctions as handed down by TÜRMOB, which has the legal authority for I&D in Turkiye among all professional accountants and is a robust system. EAAT’s Disciplinary Board is closely connected with TÜRMOB’s system whereby any disciplinary action taken by TÜRMOB will also be taken by the EAAT.

In 2024, EAAT completed a self-assessment of its I&D procedures and confirmed the procedures are mostly aligned with SMO 6 requirements with the exception of there being no independent review of complaints on which there was no follow-up established, or regular reviews of implementation and effectiveness of the system.

EAAT advertises and promotes members’ participation in TÜRMOB workshops to raise member awareness of I&D procedures.

EAAT is encouraged to address the gaps that were identified in the self-assessment against SMO 6 requirements. It is also encouraged to collaborate with TÜRMOB and the KGK to make amendments where possible that would strengthen the enforcement system to be aligned with the SMO 6 benchmark in full, in turn, advancing adoption of the global best practices.

Current Status: Review & Improve

The Public Oversight, Accounting and Auditing Standards Authority (KGK), which was established in accordance with the Public Oversight, Accounting and Auditing Standards Authority’s Organization and Responsibilities Statutory Decree No. 660, is responsible for setting corporate accounting standards in Türkiye.

KGK requires the application of Turkish Financial Reporting Standards (TFRS) which are fully converged with IFRS as issued by IASB for the financial statements of all public interest entities (PIEs). Other companies are permitted to apply IFRS or the Financial Reporting Standard for Large and Medium Sized entities (BOBI FRS) established by the KGK.

EAAT does not have authority for the adoption of accounting standards, but it does have an active role in the implementation process. EAAT supports TÜRMOB in the translation of IFRS in accordance. It also participates in the international standard-setting process by providing comments on Exposure Drafts issued by the IASB.

EAAT also supports its members with the application of accounting standards by providing access to guidance on its website and updating the education (IPD), examination, and training (CPD) curricula to incorporate new and revised Turkish Financial Reporting Standards.

EAAT is encouraged to continue to raise awareness of IFRS and emerging issues on adoption and implementation in the country. EAAT could coordinate with TURMOB and consider to what degree advocating for the adoption of IFRS for SMEs would help bring SME reporting in line with international best practices and would benefit the SME financial reporting environment in its country.

Current Status: Sustain