Lithuanian Chamber of Auditors

Member | Established: 2000 | Member since 2003

The LCA is a public legal entity unifying all certified auditors of Lithuania. In accordance with the Audit Law, the LCA has the following responsibilities: (i) administering the auditor qualification examination; (ii) issuing the auditor’s certificate; (iii) administering and monitoring of the continuing professional development program; (iv) maintaining the registry of certified auditors; (v) translation of international standards under the supervision of the Authority of Audit, Accounting, Property Valuation, and Insolvency Management (AAAPVIM); and (vi) establishing a quality assurance review system and an investigative and discipline system for registered auditors in cooperation with the AAAPVIM.

Apart from IFAC membership, LCA is also a member of Accountancy Europe, formerly known as the Federation of European Accountants, and a member of the International Valuation Standards Council.

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Statements of Membership Obligation (SMO)

The Statements of Membership Obligations form the basis of the IFAC Member Compliance Program. They serve as a framework for credible and high-quality professional accountancy organizations focused on serving the public interest by adopting, or otherwise incorporating, and supporting implementation of international standards and maintaining adequate enforcement mechanisms to ensure the professional behavior of their individual members.

Last updated: 06/2017
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SMO Action Plan

Status of Fulfillment by SMO

  • SMO 1: Quality Assurance

    LCA has played a leading role in the establishment and development of a quality assurance (QA) review system in Lithuania. From 2005–2008, LCA was legally mandated by the Audit Law to supervise the activities of the audit profession and to establish QA reviews for all audit firms. During this time, LCA administered the Audit Quality Control Committee (AQCC), which used a QA review system based on peer reviews. AQCC was an external body composed of members of LCA, the Ministry of Finance, and other organizations.

    In 2008, amendments to the Audit Law resulted in the sharing of responsibility for the QA system between LCA and the public oversight body, the Authority of Audit, Accounting, Property Valuation, and Insolvency Management (AAAPVIM). Overall supervision of the process was transferred to AAAPVIM. For example, while QA reviewers were nominated by LCA, they would be approved by AAAPVIM. In 2009, LCA adopted ISQC 1 and translated the international standard in accordance with the IFAC Translation Policy. Close cooperation between the two bodies has been ongoing since the AAAPVIM assumed its oversight responsibilities, particularly in regards to efforts to propose improvements to the QA system to Lithuanian Parliament such as requiring a QA review within one year to determine if firms were able to eliminate identified deficiencies.

    LCA reports that QA review questionnaires for auditors are in accordance with the latest version of ISA. The association provides ongoing training and information sessions to auditors on developments in the QA system in addition to organizing CPD training for full implementation of ISQC 1 amongst all types of audit firms. Furthermore, LCA also conducts a periodic review of the QA process to ensure it continues to be in line with SMO 1 requirements.

    Current Status: Sustain

  • SMO 2: International Education Standards

    Initial and continuing professional development (IPD and CPD, respectively) requirements for certified auditors are established by law in Lithuania and LCA is authorized to implement and set additional IPD and CPD requirements for its members under the supervision of the Authority of Audit, Accounting, Property Valuation, and Insolvency Management (AAAPVIM).

    LCA states that its IPD and CPD requirements are in line with IES and the association maintains an ongoing process to monitor new and revised IES and to incorporate them into the requirements. The association reports that since 2010, the curriculum for its CPD and examination programs have included topics on ISA and are being reviewed yearly. Under the oversight of AAAPVIM, LCA has also taken a leadership role in the translation and publication of the IES and strives to translate the standards on an ongoing basis.

    LCA is encouraged to establish plans to perform a benchmarking exercise to confirm its continued compliance with revised IES and to develop specific actions with a defined timeline if any gaps are identified. The association should also clarify the version of IES that has been most recently translated. It is also recommended that LCA collaborates with other stakeholders involved in the education of professional accountants in the jurisdiction, such as the AAAPVIM, to develop a roadmap for bringing national educational requirements for all professional accountants in line with IES. In addition, LCA should consider participating in the international standard-setting process by providing comments on exposure drafts and other pronouncements issues by the IAESB.

    Current Status: Review & Improve

  • SMO 3: International Standards on Auditing

    ISA and all other IAASB pronouncements are directly adopted by law in Lithuania. LCA plays an important role in the implementation process by translating the standards and ensuring that auditors are aware and using them as intended.

    Under the oversight of the Authority of Audit, Accounting, Property Valuation, and Insolvency Management), LCA has also assumed a lead role in the translation and publication of the standards and has developed an ongoing update process. LCA has established an ongoing process to ensure that the most recent version of ISA is being applied. The association reports that it follows IAASB pronouncements and establishes plans to translate revised standards before they become effective. LCA has adopted the new and revised auditor reporting standards and it has translated the complete suite of new and revised standards which consists of: ISA 700 (Revised) , ISA 701 (New), ISA 570 (Revised), ISA 706 (Revised), ISA 260 (Revised) and Conforming Amendments to ISAs 210, 220, 230, 510, 540, 580, 600, and 710. They are expected to be issued after the final publication clearance with IFAC.

    To facilitate application of ISA, the LCA reports that is has an Audit Committee which is responsible for developing guidelines regarding the main important issues that Lithuanian auditors face in everyday practice. All the guidelines are published on website of the LCA and are free of charge. The association also cooperates with different regulators (National Commission for Energy Control and Prices, Central Electoral Commission) and has developed special guidelines based on ISA for the audit services in specific sectors including the public sector and energy sector.

    In addition, the LCA supports its members’ implementation of the standards by conducting CPD courses. The association reports that it also uses its QA review system to monitor compliance with the IAASB pronouncements. Finally, with regards to the standard-setting process, LCA encourages their members to provide inputs on exposure drafts and other pronouncements issued by the IAASB.

    Current Status: Sustain

  • SMO 4: Code of Ethics for Professional Accountants

    The Audit Law No. XIII-96 of 2017 requires all certified auditors to comply with the IESBA Code of Ethics.

    The LCA, as the professional organization for certified auditors, has developed an ongoing process for the translation and publication of the Code of Ethics since 2009 to support its members’ adherence to the Code. It has translated and published the 2015 Code of Ethics according to IFAC Translation Policy. As of February 2017, LCA reports that they are in the process of translating and publishing the 2016 version. LCA has also completed the translation of the NOCLAR standard which is undergoing review and approval by May 2017.

    Furthermore, LCA also has a system for monitoring member compliance with the Code of Ethics and imposes sanctions for those found in violation of the code. The association has a Court of Honor, composed of two auditors and representatives from the Ministry of Finance, Ministry of Economy and Ministry of Justice. The Court of Honor deals with questions regarding compliance of Code of Ethics and has the right to impose penalties for auditors.

    In addition, the association has also established an ongoing process for communicating other IESBA pronouncements to its members. LCA reports that on an annual basis, it provides training on the implementation of the standards to its members.

    Current Status: Sustain

  • SMO 5: International Public Sector Accounting Standards

    LCA has no responsibility for the adoption of public sector accounting standards. The Ministry of Finance has led the reform to transfer all public sector accounting from modified cash basis to accrual basis. Since 2010, all public sector entities on both state and municipal levels have the duty to implement the National Public Sector Accounting and Reporting Standards (NPSAS) in Lithuania which are based on the International Public Sector Accounting Standards (IPSAS).

    LCA reports that it has a representative in the NPSAS Committee and cooperates with the Ministry of Finance by providing comments on the NPSAS. The association has also established an ongoing process to identify opportunities to further assist in the implementation of the standards.

    In its SMO Action Plan, LCA is encouraged to provide examples of activities it has undertaken to further assist the Ministry of Finance to support the implementation of IPSAS.

    Current Status: Review & Improve

  • SMO 6: Investigation and Discipline

    In Lithuania, a mandatory investigative and disciplinary (I&D) system has existed since 2005 as established by the Audit Law. According to the law, responsibility for the implementation of the I&D system is shared between the Authority of Audit, Accounting, Property Valuation, and Insolvency Management (AAAPVIM) and the LCA.

    Under the law, both the AAAPVIM and LCA are empowered to initiate sanctions, however, in cases regarding audit quality, only the AAAPVIM has the authority to investigate certified auditors and enforce disciplinary actions. In matters related to ethics, LCA has established the Auditors’ Court of Honor which has the authority to issue sanctions.

    In 2017, LCA conducted a self-assessment of the QA review system in the jurisdiction against the requirements of SMO 6 and reported that the system is aligned with the requirements. Moreover, the association has established an ongoing process of communication with the AAAPVIM and the Ministry of Finance to discuss improvements to the legislative requirements for the investigation and discipline of auditors and audit firms, and to ensure that they continue to be aligned with SMO 6.

    Current Status: Sustain

  • SMO 7: International Financial Reporting Standards

    The Accounting Law No. IX-574 of 2001 sets the requirements for the preparation of corporate financial statements in Lithuania. The Law outlines which accounting standards entities should apply based on their firm size and type: EU-endorsed IFRS or Lithuanian Business Accounting Standards (BAS). The Authority of Audit, Accounting, Property Valuation, and Insolvency Management (AAPVIM) is responsible for developing accounting legislation and for setting the BAS, however as from May 2017, the Ministry of Finance will be taking over the responsibility from AAPVIM.

    LCA reports that it supports the AAAPVIM in the preparation and implementation of BAS through its participation in the Accounting Standard Setting Committee of the oversight body. LCA also provides support in the translation of IFRS and indicates that it promotes the adoption of IFRS for SMEs. LCA also reports that the latest version of IFRS is being applied in the jurisdiction.

    LCA is encouraged to participate in the international standard-setting process by providing comments to IASB Exposure Drafts on new and revised pronouncements.

    Current Status: Review & Improve


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.



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