Liberia

The presentation and publication of financial statements of corporate entities in Liberia are governed by the Liberian Associations Law of 1977. The Liberian Institute of Certified Public Accountants Act of 2011 establishes the Liberian Institute of Certified Public Accountants (LICPA) as the national standard-setting body for accounting and auditing. Under the Act and LICPA’s by-laws, accounting standards issued by LICPA are required to align with international standards.

LICPA has adopted International Financial Reporting Standards (IFRS) for application by public interest entities, including banks, credit unions, insurance companies, mutual funds, securities dealers, entities in the process of listing on a public exchange, and other deposit-taking institutions, with an effective date of December 2018. Other entities are permitted to apply either IFRS or the International Financial Reporting Standard for Small and Medium-sized Entities (IFRS for SMEs).

Statutory audit requirements are established under amendments to Title 5 of the Liberian Associations Law, which set out provisions for the appointment and disqualification of auditors. Mandatory audits are required primarily for banks and financial institutions, while other entities are not subject to a general statutory audit requirement.

Auditing standards are established by LICPA under the LICPA Act 2011. LICPA has adopted International Standards on Auditing (ISA) as issued by the International Auditing and Assurance Standards Board (IAASB) for application in the jurisdiction.

The accountancy profession in Liberia is regulated under a self-regulatory model by the Liberian Institute of Certified Public Accountants (LICPA), which was established by the LICPA Act of 2011. LICPA is the primary authority responsible for regulating professional accountants and auditors in the jurisdiction, with no independent public oversight body identified.

Under the LICPA Act 2011, LICPA is responsible for setting accounting and auditing standards; licensing and registering individuals and firms to engage in public practice; maintaining a public register of members; establishing and monitoring compliance with initial professional development and continuing professional development requirements; setting ethical requirements; adopting international standards and supporting their implementation; establishing and operating quality assurance review mechanisms; and administering investigation and disciplinary processes for professional misconduct. LICPA also serves an advisory role to the Government of Liberia on public sector accounting matters.

Membership in LICPA is mandatory for individuals and firms engaging in public practice. Only members holding the Certified Public Accountant (CPA) or Registered Practicing Accountant (RPA) designations are authorized to perform statutory audits.

LICPA recognizes multiple membership categories, including Chartered Members, Certified Public Accountants (CPAs), Registered Practicing Accountants (RPAs), and Associate Accounting Technicians (AATs). Transitional provisions under the LICPA Act 2011 enabled the recognition of legacy members from the former Institute of Certified Public Accountants, Liberia, including the designation of Chartered Members and RPAs for practitioners active prior to the enactment of the law.

Entry into the CPA profession is regulated by LICPA and requires completion of a university degree, a minimum of three years of practical experience under an authorized supervisor, and successful completion of professional examinations. LICPA administers its qualification pathway in collaboration with the Institute of Chartered Accountants, Ghana, whereby candidates who pass the final examinations are eligible for CPA membership in Liberia and a corresponding professional qualification through the regional partnership.

In addition, LICPA participates in the regional Accounting Technician Scheme, West Africa, which provides a technician-level qualification pathway for Associate Accounting Technicians. This contributes to the development of mid-level accounting professionals and supports capacity building within the profession.

There is no independent public audit oversight authority in Liberia. Audit regulation, including licensing, standard-setting, quality assurance, and disciplinary functions, is carried out by the Liberian Institute of Certified Public Accountants (LICPA) under the LICPA Act 2011.

LICPA is therefore responsible for both professional regulation and oversight of auditors, operating within a self-regulatory framework. This includes the establishment and implementation of quality assurance review systems and investigation and disciplinary mechanisms for audit practitioners.

While sector-specific regulators, such as financial sector authorities, may impose additional audit-related requirements for regulated entities, no separate, independent body has been identified with overarching responsibility for public oversight of the audit profession in the jurisdiction.

Liberian Institute of Certified Public Accountants (LICPA)

The Liberian Institute of Certified Public Accountants (LICPA) is the national professional accountancy organization in Liberia. LICPA is the successor to the Institute of Certified Public Accountants, Liberia, which was established under the 1933 Act, and was re-established under the LICPA Act of 2011 to regulate, represent, and promote the accountancy profession in the public interest.

LICPA membership is mandatory for individuals and firms that provide public accountancy services in Liberia. Its membership categories include Chartered Members, Certified Public Accountants, Certified Accountant Technicians or Student Members, and firm members. Registered Practicing Accountant is a transitional practice status for individuals who were engaged in public accounting before the LICPA Act became effective.

Under the LICPA Act, LICPA is responsible for regulating professional accountants and auditors, setting and adopting accounting, auditing, and other assurance standards, licensing individuals and firms in public practice, maintaining member registers, establishing quality control and quality assurance requirements, setting ethical requirements, and administering investigation and disciplinary mechanisms.

LICPA supports professional education and credentialing through the Accounting Technician Scheme, West Africa, the Institute of Chartered Accountants, Ghana Certified Public Accountant program, and its Syllabi Integration Program. The technician program is administered in Liberia under the auspices of the Association of Accountancy Bodies in West Africa, while the professional Certified Public Accountant pathway is administered under a memorandum of understanding with the Institute of Chartered Accountants, Ghana.

LICPA is affiliated with regional accountancy organizations, including the Association of Accountancy Bodies in West Africa and the Pan African Federation of Accountants.

Under the Liberian Institute of Certified Public Accountants Act of 2011, the Liberian Institute of Certified Public Accountants (LICPA) is responsible for establishing and implementing a quality assurance (QA) review system for auditors. The Act requires periodic QA reviews for audit practitioners and provides for the establishment of an Audit Quality Assurance Board to oversee the process and ensure appropriate remedial actions.

LICPA operationalized QA reviews in 2020 through a review conducted by the Institute of Chartered Accountants of Nigeria, covering audit firms performing assurance engagements in the jurisdiction. The review framework was based on International Standard on Quality Control 1 (ISQC 1), together with International Standards on Auditing and the International Code of Ethics for Professional Accountants.

International Standards on Quality Management 1 and 2 (ISQM 1 and ISQM 2), which replaced ISQC 1 and are effective from December 15, 2022, represent the current benchmark under SMO 1. Available information indicates that the QA review system in Liberia has been established and is operational; however, alignment with the latest quality management standards has not been fully demonstrated.

Current Status: Partially Adopted

Under the Liberian Institute of Certified Public Accountants Act of 2011, the Liberian Institute of Certified Public Accountants (LICPA) is responsible for establishing and implementing initial professional development and continuing professional development requirements for professional accountants in the jurisdiction.

LICPA’s initial professional development framework requires completion of a university degree, a minimum of three years of practical experience, and successful completion of professional examinations. The professional qualification pathway is administered in collaboration with the Institute of Chartered Accountants, Ghana, and is supported by the Accounting Technician Scheme, West Africa for technician-level qualifications. Continuing professional development is mandatory for members.

While the framework incorporates key components of the International Education Standards, available information does not demonstrate full alignment with the latest requirements in effect at the time of the assessment across all areas, including learning outcomes and competence-based approaches.

Current Status: Partially Adopted

Under the Liberian Institute of Certified Public Accountants Act of 2011, the Liberian Institute of Certified Public Accountants (LICPA) is authorized to determine, issue, and monitor professional standards, including auditing and other assurance standards. In July 2015, LICPA issued Regulation 1: Professional Standards and Related Practice Statements, which adopted International Standards on Auditing (ISA) as issued by the International Auditing and Assurance Standards Board (IAASB). All subsequent standards and revisions issued by the IAASB are automatically adopted for application in Liberia.

ISA for Audits of Financial Statements of Less Complex Entities is adopted in Liberia through the automatic adoption mechanism.

Current Status: Adopted

Under the Liberian Institute of Certified Public Accountants Act of 2011, the Liberian Institute of Certified Public Accountants (LICPA) is responsible for determining, issuing, monitoring, and enforcing ethics requirements for professional accountants in Liberia. The Act also requires LICPA’s Council to maintain a Code of Professional Ethics and ensure that ethics standards remain relevant to the needs of users of financial statements.

LICPA’s Council formally adopted the 2018 International Code of Ethics for Professional Accountants issued by the International Ethics Standards Board for Accountants (IESBA). LICPA’s published Code of Ethics indicates that members are subject to disciplinary action for non-compliance and that members may not apply less stringent standards than those contained in the Code.

Current Status: Partially Adopted

The Ministry of Finance and Development Planning is responsible for public sector accounting standards in Liberia. The Public Financial Management Act of 2009 and related regulations establish the public financial management framework, while the Liberian Institute of Certified Public Accountants Act of 2011 assigns the Liberian Institute of Certified Public Accountants an advisory role to the government on public sector accounting matters.

Liberia adopted Cash Basis International Public Sector Accounting Standards (IPSAS) in 2009, with a stated objective of transitioning to accrual-basis IPSAS. In 2021, the government announced implementation of the November 8, 2017 updated Cash Basis IPSAS for all government agencies.

Current Status: Partially Adopted

Under the Liberian Institute of Certified Public Accountants Act of 2011, the Liberian Institute of Certified Public Accountants (LICPA) is responsible for establishing disciplinary mechanisms for investigating and disciplining members for breaches of professional requirements. The Act requires LICPA to establish an I&D system in line with SMO 6.

LICPA has issued Sanction Regulations and established an Ethics and Discipline Committee to investigate allegations of professional misconduct involving members, member firms, and Registered Practicing Accountants. The regulations set out procedures for receiving complaints, investigating alleged misconduct, reporting findings to LICPA’s Governing Council, imposing sanctions, and communicating disciplinary decisions.

Available information indicates that the I&D system is established and operational and incorporates several SMO 6 requirements. However, the same committee appears to perform investigative and disciplinary functions, with final decisions subject to Governing Council approval, and full alignment with all SMO 6 requirements, including independent disciplinary decision-making and appeals arrangements, has not been demonstrated. Accordingly, the jurisdiction-level framework is not fully aligned with the SMO 6 requirements. I&D is assessed as Partially Adopted.

Current Status: Partially Adopted

The Liberian Institute of Certified Public Accountants Act of 2011 authorizes the Liberian Institute of Certified Public Accountants (LICPA) to adopt accounting standards for the private sector. LICPA has adopted IFRS Accounting Standards as issued by the International Accounting Standards Board for public interest entities, including banks, credit unions, insurance companies, mutual funds, securities dealers, entities seeking a public listing, and other public interest deposit-taking entities, effective December 2018. Other entities are permitted to apply either IFRS Accounting Standards or the IFRS for SMEs Accounting Standard.

Current Status: Adopted

Relevant Organizations

African Professionalisation Initiative

Liberian Institute of Certified Public Accountants

Ministry of Finance and Development Planning

Relevant Legislation

Liberian Institute of Certified Public Accountants Act, 2011

Public Financial Management Act, 2009

Relevant Publications

LICPA Code of Ethics (2020)

LICPA Sanction Regulations (2020)

Ministry of Finance and Development Planning Press Release on IPSAS Implementation (2021)