Mozambique

The financial reporting framework in Mozambique is principally set out in the Commercial Code, approved by Decree-Law No. 2/2005 of December 27, 2005, and Decree No. 70/2009 of December 22, 2009, which approved the Sistema de Contabilidade para o Sector Empresarial (SCE). The Commercial Code requires commercial entrepreneurs to maintain organized bookkeeping and prepare annual accounts. Decree No. 70/2009 established a differential reporting framework for private sector entities comprising the Plano Geral de Contabilidade para Empresas de Grande e Média Dimensão (PGC-NIRF) and the Plano Geral de Contabilidade para as Pequenas e Demais Empresas (PGC-PE). The PGC-NIRF is based on IFRS as published in November 2008, with certain omissions, while the PGC-PE applies to smaller entities. Banking and insurance entities are excluded from the SCE and are subject to sector-specific requirements issued by the Bank of Mozambique and the Ministry of Finance. Available sources also indicate that the accounting standards board envisaged under Decree No. 70/2009 has not yet been operationalized.

Auditing requirements are established through the Commercial Code and sectoral regulation. According to IFAC’s jurisdiction profile for Mozambique, large companies, listed companies, and companies with foreign shareholding are required to have their financial statements audited. The Commercial Code also requires companies issuing bonds or using public subscription to obtain the opinion of an auditor or audit firm on their accounts. Law No. 8/2012 authorizes the Ordem dos Contabilistas e Auditores de Moçambique (OCAM) to define technical standards taking into consideration international best practices, and OCAM reports that International Standards on Auditing as issued by the International Auditing and Assurance Standards Board are applied in Mozambique. Banks and insurance companies are also subject to additional sector-specific audit and reporting requirements, and financial institutions must obtain approval from the Bank of Mozambique for the appointment of their external auditor.

The accountancy profession in Mozambique is regulated by the Ordem dos Contabilistas e Auditores de Moçambique (OCAM) in accordance with Law No. 8/2012. The law establishes OCAM as the statutory professional accountancy organization responsible for regulating professional accountants and auditors in the jurisdiction. Under Section 6 of the Law, OCAM is responsible for, among other functions, promoting the interests of the profession; issuing practicing certificates for certified accountants and certified auditors; maintaining a register of members; establishing initial and continuing professional development requirements; setting ethical requirements; operating an investigative and disciplinary system; defining technical standards with reference to international best practices; proposing legislative and regulatory measures related to the Sistema de Contabilidade para o Sector Empresarial (SCE); and establishing and implementing a quality assurance review system.

All individuals wishing to practice as professional accountants in Mozambique must hold the designation of certified accountant or certified auditor and be registered with OCAM. These professional titles are protected by Law No. 8/2012 and may only be used by registered members. In accordance with Section 12 of the Law, certified accountants are authorized to provide accounting and advisory services, including the preparation of financial statements and accounting-related consultancy services, while certified auditors may provide these services in addition to statutory audit and assurance services.

The pathway to qualification is established through OCAM’s College of Accountants and College of Auditors. Candidates are required to hold a university degree in accounting or a related field, pass an entrance examination, complete three years of supervised practical experience under an OCAM member in good standing, and successfully complete the relevant written and oral examinations. OCAM has established cooperation arrangements with the Ordem dos Contabilistas Certificados and the Ordem dos Revisores Oficiais de Contas in Portugal, under which the examination frameworks are aligned. Individuals holding qualifications from IFAC-recognized professional accountancy organizations may also be admitted, subject to satisfying local taxation and company law examination requirements. Certified auditors are additionally subject to licensing requirements by the Ministry of Finance in order to conduct audit engagements.

There is no independent public audit oversight authority in Mozambique. The regulation and oversight of auditors is primarily carried out by the Ordem dos Contabilistas e Auditores de Moçambique (OCAM) in accordance with Law No. 8/2012. Individuals wishing to practice public audit must hold the designation of certified auditor and be registered as members of OCAM. In addition, auditors are subject to formal licensing requirements administered by the Ministry of Finance.

Under its statutory mandate, OCAM is responsible for issuing practicing certificates for certified auditors; maintaining the register of members; establishing initial and continuing professional development requirements; setting ethical requirements; defining auditing standards with reference to international best practices; operating the investigative and disciplinary system; and establishing and implementing the quality assurance review system.

OCAM is also a member of the African Forum of Independent Accounting and Auditing Regulators, which supports regional cooperation and capacity building in audit regulation and oversight across Africa.

Ordem dos Contabilistas e Auditores de Moçambique (OCAM)

The Ordem dos Contabilistas e Auditores de Moçambique (OCAM) is the statutory professional accountancy organization in Mozambique, established under Law No. 8/2012 and empowered to regulate the accountancy profession. Its membership comprises certified accountants and certified auditors. All individuals wishing to practice as professional accountants in Mozambique are required to hold one of these protected professional designations and be registered with OCAM.

Under Section 6 of Law No. 8/2012, OCAM’s responsibilities include promoting the interests of the profession; issuing practicing certificates; maintaining the register of members; establishing initial and continuing professional development requirements; setting ethical requirements; operating the investigative and disciplinary system; defining technical standards with reference to international best practices; proposing legislative and regulatory measures related to the Sistema de Contabilidade para o Sector Empresarial; and establishing and implementing the quality assurance review system.

In addition to being an Associate member of IFAC since 2019, OCAM is a member of the Pan African Federation of Accountants, through which it engages in regional initiatives to strengthen the accountancy profession and support the adoption and implementation of international standards and best practices across Africa.

The Ordem dos Contabilistas e Auditores de Moçambique (OCAM) is responsible for conducting quality assurance reviews in Mozambique in accordance with Law No. 8/2012. In 2014, OCAM established regulations adopting quality control standards, quality assurance review procedures aligned with the requirements of Statement of Membership Obligation 1, Quality Assurance (SMO 1), and a Quality Assurance Committee.

In 2017, OCAM entered into a Memorandum of Understanding with the Public Accountants and Auditors Board of Zimbabwe to support the operationalization of the quality assurance review system and strengthen local review capacity. Quality assurance reviews commenced in 2018 and continue to be conducted using both a risk-based and cycle-based approach. The system applies to all audit firms and includes review cycles of at least once every six years, and every three years for firms providing services to public interest entities.

OCAM has also received technical support and reviewer training from regional and international partners, including the Public Accountants and Auditors Board of Zimbabwe, the Independent Regulatory Board for Auditors of South Africa, and the Ordem dos Revisores Oficiais de Contas of Portugal.

The quality management framework was originally established under International Standard on Quality Control 1 (ISQC 1). Following the replacement of ISQC 1 by International Standard on Quality Management 1 (ISQM 1) and International Standard on Quality Management 2 (ISQM 2), effective December 2022, audit firms are expected to apply the updated international quality management standards as part of the jurisdiction’s applicable auditing framework.

The quality assurance review system is operational and remains aligned with the requirements of SMO 1.

Current Status: Adopted

Law No. 8/2012 outlines the general entry and educational requirements for professional accountants in Mozambique and authorizes the Ordem dos Contabilistas e Auditores de Moçambique (OCAM) to establish more specific initial professional development and continuing professional development requirements for its members.

The professional designations of certified accountant and certified auditor are protected by law and may only be used by registered members of OCAM. Individuals must hold a university degree in accounting or a related field to be eligible to sit OCAM’s examinations for admission to its College of Accountants or College of Auditors. Candidates are also required to complete three years of practical experience under the supervision of an OCAM member in good standing. Practical experience is evaluated following the successful completion of written and oral final examinations.

OCAM’s Admission and Qualification Committee and Examination Jury are responsible for defining the content of professional education and examinations. In partnership with the Ordem dos Contabilistas Certificados and the Ordem dos Revisores Oficiais de Contas of Portugal, OCAM’s Colleges utilize examination materials from the respective institutes, which align with the 2019 International Education Standards 2, 3, 4, and 6.

Chapter 20 of OCAM’s Internal Code of Conduct establishes mandatory continuing professional development requirements for all certified accountants and certified auditors. All members are required to complete 120 hours of continuing professional development over a three-year period. OCAM states that it has adopted the requirements of the International Education Standards.

Current Status: Adopted

The Commercial Code 2005 stipulates that large companies, listed companies, and companies with foreign shareholding are required to have their financial statements audited. Banks and insurance companies are also required to submit their annual audited financial statements to the Bank of Mozambique.

Law No. 8/2012 authorizes the Ordem dos Contabilistas e Auditores de Moçambique (OCAM) to define auditing standards taking into consideration international best practices. OCAM states that it has adopted the International Standards on Auditing as issued by the International Auditing and Assurance Standards Board for application in all mandatory audits in the jurisdiction.

All certified audit firms are required to apply the International Standards on Auditing in the conduct of audit work in Mozambique.

Current Status: Adopted

Under Law No. 8/2012, the Ordem dos Contabilistas e Auditores de Moçambique (OCAM) is responsible for establishing ethical requirements for professional accountants. OCAM issued Resolution 5/GB/2014, which adopted the International Code of Ethics for Professional Accountants as issued by the International Ethics Standards Board for Accountants in its entirety as OCAM’s Code of Ethics.

Current Status: Adopted

The Government of Mozambique is responsible for establishing public sector accounting standards. In accordance with Law No. 9/2012, public sector financial reporting continues to be based on national cash-basis accounting standards.

Recent public financial management reform documentation from the International Monetary Fund indicates that International Public Sector Accounting Standards are currently being used as guidance for the development of national public sector accounting standards adapted to Mozambique’s needs and institutional capacity, rather than being formally adopted as the applicable reporting framework.

While reform efforts are ongoing, including the Government’s broader public financial management strategy and prior reports of a taskforce established in collaboration with the Ordem dos Contabilistas e Auditores de Moçambique, accrual-basis International Public Sector Accounting Standards have not yet been formally adopted for application by public sector entities in the jurisdiction.

Current Status: Not Adopted

The Ordem dos Contabilistas e Auditores de Moçambique (OCAM) is empowered by Law No. 8/2012 to establish an investigative and disciplinary system for professional accountants. Resolution No. 8/GB/2014 establishes the procedures governing the system, which is overseen by the Judicial Council of the association.

The Judicial Council comprises four separate divisions responsible for investigation, discipline, representation of rights, and adjudication. Committee members are structured to operate independently and include both members and non-members, such as retired practitioners and legal professionals. An administrative court is also available to hear appeals.

OCAM reports that the system is operational and that, following the commencement of quality assurance reviews in 2018, quality assurance findings may lead to disciplinary consequences where appropriate. The association has also implemented an online platform to strengthen case recordkeeping and the tracking of investigative and disciplinary matters.

The investigative and disciplinary system is operational and incorporates the requirements of Statement of Membership Obligation 6.

Current Status: Adopted

The financial reporting framework in Mozambique is established under the Commercial Code 2005 and Decree No. 70/2009 of December 22, 2009. The Commercial Code establishes the obligation for companies to maintain books of account, while Decree No. 70/2009 sets out the applicable accounting standards framework.

Decree No. 70/2009 revised the general chart of accounts to establish the Sistema de Contabilidade para o Sector Empresarial, which includes the Plano Geral de Contabilidade para Empresas de Grande e Média Dimensão. This framework is based on International Financial Reporting Standards as published in November 2008, with certain standards omitted, and became effective in 2010. A simplified framework, the Plano Geral de Contabilidade para as Pequenas e Demais Empresas, became effective in 2011 for smaller entities.

The Sistema de Contabilidade para o Sector Empresarial does not apply to banking and insurance institutions, which are subject to separate requirements established by the Bank of Mozambique and the Ministry of Finance. While earlier regulatory notices referred to IFRS as published in 2008, OCAM reports that in practice entities supervised by these regulators apply International Financial Reporting Standards as issued by the International Accounting Standards Board.

Decree No. 70/2009 also envisaged the establishment of an accounting standards board under the Ministry of Finance to update and maintain the national framework; however, this body has not yet been operationalized. OCAM, with support from the Pan African Federation of Accountants, has proposed the establishment of an independent standard-setting committee, although approval remains pending.

International Financial Reporting Standards currently in effect have not been adopted for application by all domestic publicly accountable entities in the jurisdiction.

Current Status: Partially Adopted

Relevant Organizations

Ordem dos Contabilistas e Auditores de Moçambique (OCAM)

Relevant Legislation

Commercial Code 2005 (English)

Decree 70/2009 (English)

Relevant Publications

OCAM, SMO Action Plan, 2021.

Thomson Reuters, “Doing Business in Mozambique”, June 2012.

World Bank, Report on the Observance of Standards and Codes—Accounting and Auditing: Mozambique, June 2008