Italy

Italy, as a member of the European Union (EU), is subject to accounting, auditing, financial reporting, and sustainability reporting requirements established through EU Regulations and Directives as transposed into national law. The national legal and regulatory framework is aligned with the EU acquis communautaire in the areas of corporate reporting, statutory audit, and professional oversight.

The financial reporting framework is based on EU Regulation (EC) No. 1606/2002, as implemented through Legislative Decree No. 38/2005, which requires the application of International Financial Reporting Standards (IFRS) as endorsed by the EU for the preparation of consolidated financial statements of listed entities. In practice, IFRS are mandatory for listed companies under the supervision of the Commissione Nazionale per le Società e la Borsa (CONSOB), while other entities may apply IFRS on a voluntary basis or apply national accounting standards.

For entities not required to apply IFRS, financial reporting requirements are set out in the Italian Civil Code (Articles 2423–2435-bis), as amended by Legislative Decree No. 139/2015, which transposes Directive 2013/34/EU. These requirements are interpreted and supplemented by national accounting standards issued by the Organismo Italiano di Contabilità (OIC) under Law No. 116/2014. Italian accounting standards differ from IFRS, although convergence with international standards continues to be pursued.

Statutory audit requirements are established under Legislative Decree No. 39/2010, which transposes the EU Statutory Audit Directive and Regulation (EU) No. 537/2014, together with provisions of Legislative Decree No. 58/1998 applicable to public interest entities (PIEs). Mandatory audits are required for PIEs, companies limited by shares, and other entities meeting prescribed legal thresholds, including certain limited liability companies that exceed size criteria or are part of group structures.

Audits are required to be conducted by statutory auditors (Revisori Legali) registered with the Ministry of Economy and Finance (MEF). Audits are performed in accordance with Italian auditing standards (ISA Italia), which are developed through a multi-stakeholder process involving the Consiglio Nazionale dei Dottori Commercialisti e degli Esperti Contabili (CNDCEC), professional associations, MEF, and CONSOB, and are formally adopted by ministerial decree. ISA Italia are based on International Standards on Auditing (ISA) and reflect alignment with the 2022 ISA framework.

Sustainability reporting requirements are evolving in line with EU developments. Legislative Decree No. 254/2016 implemented Directive 2014/95/EU on non-financial reporting, while Directive (EU) 2022/2464 on corporate sustainability reporting is in the process of being transposed into Italian law, introducing expanded sustainability reporting obligations for a broader set of entities.

The regulation of the accountancy profession in Italy is governed by Legislative Decree No. 139/2005, Legislative Decree No. 39/2010, and subsequent amendments, including Legislative Decree No. 135/2016. The framework reflects a shared regulatory model in which responsibilities are divided among government authorities, independent regulators, and professional accountancy organizations.

Professional Accountants

The Legislative Decree No. 139/2005 establishes the regulatory framework for professional accountants and defines the roles and responsibilities of the Consiglio Nazionale dei Dottori Commercialisti e degli Esperti Contabili (CNDCEC) under the supervision of the Ministry of Justice.

Two professional designations are recognized within the profession: Dottori Commercialisti and Esperti Contabili. Both categories are authorized to provide accounting, tax, and advisory services, while Dottori Commercialisti are additionally permitted to perform broader professional activities, including company valuations, insolvency procedures, and non-statutory assurance engagements.

Entry into the profession is regulated by law and requires completion of a university degree, a period of supervised practical experience, and successful completion of a state examination. Individuals must be registered with the CNDCEC through its territorial chapters to practice.

The CNDCEC operates as the statutory professional body with mandatory membership and is responsible for establishing ethical requirements, monitoring compliance with professional standards, overseeing continuing professional development, and representing the profession at the national and international levels. The CNDCEC also contributes to the legislative process through consultation on draft laws and regulations and supports the implementation of technical standards among its members.

Statutory Auditors

The statutory audit profession is regulated under Legislative Decree No. 39/2010, which establishes the requirements for the qualification, registration, and oversight of statutory auditors (Revisori Legali).

Statutory auditors are subject to a separate public oversight system led by the Ministry of Economy and Finance (MEF) and the Commissione Nazionale per le Società e la Borsa (CONSOB). To qualify as a statutory auditor, individuals must complete a university degree, a minimum three-year period of practical experience, and pass a national examination before being registered in the register of statutory auditors maintained by the MEF.

The MEF is responsible for the registration and oversight of statutory auditors of non-public interest entities, including establishing continuing professional development requirements, conducting quality assurance reviews, and administering investigation and disciplinary procedures. The MEF also formally adopts auditing standards and ethical requirements applicable to statutory auditors.

Statutory auditors and audit firms that perform audits of public interest entities are subject to additional oversight by the CONSOB. The CONSOB is responsible for supervising audit quality, independence, and compliance with applicable standards for these entities, as well as conducting inspections and enforcing disciplinary measures where necessary.

Auditing standards and ethical requirements applicable to statutory auditors are developed through a multi-stakeholder process involving the CNDCEC, the Istituto Nazionale Revisori Legali (INRL), and the Associazione Italiana delle Società di Revisione Legale (ASSIREVI), in coordination with the MEF and CONSOB, and are formally endorsed through ministerial acts.

Independent public oversight of the audit profession in Italy is established under Legislative Decree No. 39/2010, as amended by Legislative Decree No. 135/2016, which transposes the European Union statutory audit framework into national law. The oversight system is shared between the Ministry of Economy and Finance (MEF) and the Commissione Nazionale per le Società e la Borsa (CONSOB).

The MEF maintains the register of statutory auditors and audit firms and is responsible for the oversight of statutory auditors and audit firms that do not audit public interest entities. Its responsibilities include registration, continuing professional development, quality assurance reviews, investigation and discipline, and the adoption of auditing standards and ethical requirements for statutory auditors.

The CONSOB is responsible for oversight of statutory auditors and audit firms that audit public interest entities. Its responsibilities include supervising audit quality, independence, and technical competence, conducting inspections, and enforcing applicable requirements for audits of public interest entities.

The CONSOB is a member of the International Forum of Independent Audit Regulators.

The Consiglio Nazionale dei Dottori Commercialisti e degli Esperti Contabili (CNDCEC)

The Consiglio Nazionale dei Dottori Commercialisti e degli Esperti Contabili (CNDCEC) is the statutory professional accountancy organization for professional accountants in Italy. It was established under Legislative Decree No. 139/2005 and operates under the supervision of the Ministry of Justice. Membership is mandatory for individuals practicing as Dottori Commercialisti or Esperti Contabili.

The CNDCEC operates as the national body coordinating the territorial orders of the profession. Its responsibilities include representing members at the national level, promoting relations with public institutions, adopting and updating ethical requirements, coordinating and supporting territorial orders, contributing to draft laws and regulations affecting the profession, and approving continuing professional development programs.

The CNDCEC also supports the profession through technical guidance, training, e-learning, and tools for members, including resources related to professional practice, taxation, business reporting, and recognition of foreign qualifications.

In addition to its national role, CNDCEC is a member of the International Federation of Accountants, Accountancy Europe, CFE Tax Advisers Europe, the Latin Integration Committee of Europe and the Americas, and Professional Accountancy Education Europe.

Legislative Decree No. 39/2010 establishes the quality assurance (QA) review system for statutory auditors and audit firms in Italy. The Ministry of Economy and Finance (MEF) is responsible for QA reviews of statutory auditors and audit firms that audit non-public interest entities, while the Commissione Nazionale per le Società e la Borsa (CONSOB) is responsible for QA reviews of statutory auditors and audit firms that audit public interest entities.

The QA review system is operational for audits of public interest entities under CONSOB oversight. However, the QA system for audits of non-public interest entities under MEF oversight is not fully operational for all mandatory audits. As a result, the jurisdiction-level QA framework is not fully aligned with the requirements of SMO 1.

Italy has adopted ISQM Italia 1 and ISQM Italia 2, which replace ISQC Italia 1 and are effective for audits of financial statements for periods beginning on or after January 1, 2025, with early application permitted from January 1, 2024.

Current Status: Partially Adopted

Legislative Decree No. 139/2005 establishes the initial professional development (IPD) requirements for professional accountants in Italy, with responsibilities shared between the Ministry of University and Research and the Consiglio Nazionale dei Dottori Commercialisti e degli Esperti Contabili (CNDCEC). Entry into the profession requires completion of a university degree, a period of supervised practical experience, and successful completion of a state examination. Continuing professional development (CPD) requirements are established and monitored by the CNDCEC and implemented through the territorial orders.

The IPD and CPD requirements for statutory auditors (Revisori Legali) are established under Legislative Decree No. 39/2010 and Legislative Decree No. 135/2016, including requirements for a university degree, a minimum three-year period of practical experience, a national examination, and mandatory CPD under the oversight of the Ministry of Economy and Finance.

The national education framework for both professional accountants and statutory auditors incorporates learning outcomes, practical experience, assessment, and CPD requirements that are aligned with the International Education Standards (IES) issued by the International Accounting Education Standards Board. The CNDCEC reports that the revised IES have been incorporated into national requirements.

Current Status: Adopted

In accordance with Legislative Decree No. 39/2010, statutory audits in Italy must be conducted by statutory auditors (Revisori Legali) registered with the Ministry of Economy and Finance (MEF) and in accordance with national auditing standards (ISA Italia). ISA Italia are developed through a multi-stakeholder process coordinated by the MEF, with the involvement of the Consiglio Nazionale dei Dottori Commercialisti e degli Esperti Contabili (CNDCEC), Associazione Italiana delle Società di Revisione Legale, Istituto Nazionale Revisori Legali, and the Commissione Nazionale per le Società e la Borsa (CONSOB), and are formally adopted by determination of the State Accountant General.

The latest ISA Italia incorporate the 2022 International Auditing and Assurance Standards Board Handbook. Italy has also adopted ISQM Italia 1, ISQM Italia 2, and ISA Italia 220 (Revised), which are effective for audits of financial statements for periods beginning on or after January 1, 2025, with early application permitted.

However, more recent revisions reflected in the latest International Auditing and Assurance Standards Board Handbook (2025) have not yet been incorporated into ISA Italia. As a result, the jurisdiction-level framework is not fully aligned with the most current ISA in effect at the time of the assessment.

ISA for Less Complex Entities has not been adopted in Italy.

Current Status: Partially Adopted

The Consiglio Nazionale dei Dottori Commercialisti e degli Esperti Contabili (CNDCEC) is responsible for setting ethical requirements for its members under Legislative Decree No. 139/2005. The CNDCEC Code of Ethics was most recently approved on March 21, 2024 and applies to members registered as Dottori Commercialisti and Esperti Contabili.

For statutory auditors (Revisori Legali), ethical and independence requirements are set out in the Italian Code of Ethics and Independence, adopted by determination of the Ministry of Economy and Finance on March 23, 2023. The Code applies to statutory audits of financial statements for periods beginning on or after January 1, 2023.

The Italian Code of Ethics and Independence was developed by Associazione Italiana Revisori Contabili, CNDCEC, and Istituto Nazionale Revisori Legali, jointly with the MEF and the Commissione Nazionale per le Società e la Borsa. It is based on the 2018 International Ethics Standards Board for Accountants Code, with adaptations and localizations for the Italian and European legal frameworks.

The current International Ethics Standards Board for Accountants Handbook is the 2025 edition. As Italy has adopted a localized framework based on the 2018 Code for statutory auditors, while professional accountants are subject to the CNDCEC national Code, the jurisdiction-level framework is not fully aligned with the latest Code in effect at the time of the assessment.

Current Status: Partially Adopted

Public sector accounting requirements in Italy are established under Law No. 196/2009 and related public finance legislation. Italy currently applies national public sector accounting requirements and has not adopted International Public Sector Accounting Standards (IPSAS) for all public sector entities.

Italy is undertaking an accrual accounting reform through the Ministry of Economy and Finance and the Ragioneria Generale dello Stato. The reform is linked to Italy’s National Recovery and Resilience Plan and is intended to introduce a single accrual-based accounting system for public administrations, supported by standards developed with reference to IPSAS and European Public Sector Accounting Standards (EPSAS).

IPSAS are assessed as Not Adopted because Italy has not adopted accrual-basis IPSAS for application by all public sector entities. The ongoing accrual reform is a significant development, but the jurisdiction-level framework is not yet aligned with SMO 5 requirements for IPSAS adoption.

Current Status: Not Adopted

Legislative Decree No. 139/2005 establishes the investigation and discipline (I&D) framework for professional accountants registered as Dottori Commercialisti and Esperti Contabili. Disciplinary authority is exercised through the territorial orders, with appeals available through the Consiglio Nazionale dei Dottori Commercialisti e degli Esperti Contabili (CNDCEC) and the ordinary courts. The framework is supported by CNDCEC disciplinary regulations and applies to members registered with the profession.

For statutory auditors (Revisori Legali), Legislative Decree No. 39/2010 establishes the I&D framework. The Ministry of Economy and Finance is responsible for statutory auditors and audit firms that do not audit public interest entities, while the Commissione Nazionale per le Società e la Borsa is responsible for statutory auditors and audit firms that audit public interest entities.

The system includes disciplinary procedures and sanctions for professional accountants and statutory auditors. However, the framework remains divided across separate authorities and does not clearly demonstrate full alignment with all SMO 6 requirements for all professional accountants, including consistent links with quality assurance review outcomes and separation of investigation and disciplinary functions across the full profession.

Current Status: Partially Adopted

The European Union (EU) Regulation (EC) No. 1606/2002 requires companies whose securities are admitted to trading on an EU regulated market to prepare consolidated financial statements in accordance with IFRS Accounting Standards as adopted by the EU. In Italy, IFRS as adopted by the EU are required for the consolidated financial statements of all domestic companies whose securities trade on a regulated market and are also required or permitted for certain other entities under national law.

Entities that are not required or permitted to apply IFRS generally apply Italian national accounting standards issued by the Organismo Italiano di Contabilità (OIC), which supplement and interpret the accounting requirements of the Italian Civil Code.

IFRS are assessed as Partially Adopted because IFRS as adopted by the EU, rather than IFRS as issued by the International Accounting Standards Board, are required for selected entities and are not required jurisdiction-wide for all entities of public interest.

The IFRS for SMEs Accounting Standard has not been adopted in Italy and is not under consideration.

Current Status: Partially Adopted

Relevant Organizations

Commissione Nazionale per le Società e la Borsa (CONSOB)

Consiglio Nazionale dei Dottori Commercialisti e degli Esperti Contabili (CNDCEC)

European Commission

Ministry of Economy and Finance (MEF)

Organismo Italiano di Contabilità (OIC)

Ragioneria Generale dello Stato (RGS)

Relevant Legislation

Directive 2013/34/EU on annual financial statements

Directive (EU) 2022/2464 on corporate sustainability reporting

Legislative Decree No. 38/2005

Legislative Decree No. 39/2010

Legislative Decree No. 135/2016

Legislative Decree No. 139/2005

Legislative Decree No. 254/2016

Legislative Decree No. 125/2024

Law No. 196/2009

Regulation (EC) No. 1606/2002

Relevant Publications

IFRS Foundation Jurisdiction Profile – Italy

CNDCEC Code of Ethics (2024)

Italian Code of Ethics and Independence for Statutory Auditors (2023)

ISQM Italia 1 (2025)

Supporting the implementation of accrual IPSAS/EPSAS accounting in the Italian public administration