Yemen

The accounting, auditing, and financial reporting framework in Yemen is primarily established under the Audit and Review of Accounts Law No. 26 of 1999, as amended in 2004, and Council of Ministers Resolution No. 51 of 2019.

Accounting Framework

Council of Ministers Resolution No. 51 of 2019 requires the application of International Financial Reporting Standards (IFRS) as issued by the International Accounting Standards Board (IASB) for public interest entities beginning January 1, 2020. Public interest entities include banks and financial institutions supervised by the Central Bank of Yemen, as well as entities required to submit financial statements to the Ministry of Industry and Trade (MIT) and the Tax Authority. The Resolution also adopts the IFRS for Small and Medium-sized Entities (IFRS for SMEs) for eligible entities.

At the time of the assessment, IFRS as issued by the IASB are required by law; however, the extent to which the most current IFRS pronouncements are formally endorsed and implemented in practice could not be independently verified.

Auditing Framework

Council of Ministers Resolution No. 51 of 2019 requires the application of International Standards on Auditing (ISA) and related pronouncements issued by the International Auditing and Assurance Standards Board (IAASB) for all mandatory audits beginning January 1, 2020.

Certified Public Accountants (CPAs) are legally regulated under the Audit and Review of Accounts Law No. 26 of 1999, as amended in 2004. The Law established the Higher Council of Accounting and Auditing (HCAA) as the state-level authority for the profession. However, as the HCAA was not operationalized, Council of Ministers Resolution No. 51 of 2019 assigned regulatory responsibilities jointly to the Ministry of Industry and Trade (MIT) and the Yemeni Association of Certified Public Accountants (YACPA).

Under Council of Ministers Resolution No. 51 of 2019, MIT is responsible for overseeing the quality assurance (QA) review system for audits, adopting international accounting, auditing, and ethical standards issued by the relevant international standard-setting boards, and establishing and operationalizing an investigation and discipline (I&D) system.

YACPA is legally recognized as the professional association representing the accounting profession in Yemen and advises the government on accounting and auditing standards. The Audit and Review of Accounts Law No. 26 of 1999 also provides for a Public Accountants Permit Committee, through which MIT exercises regulatory responsibilities, with YACPA represented on the Committee.

YACPA is authorized to participate in drafting regulations related to the profession, monitor members’ compliance with ethical, accounting, and auditing standards, cooperate with MIT on I&D matters, organize professional education and training, deliver continuing professional development, administer CPA examinations, maintain the CPA registry, and operate the QA review system under MIT supervision.

YACPA confers the CPA qualification, while MIT grants practice permits to CPAs who are members of YACPA and authorized to practice audit. Audit and assurance services may only be performed by CPAs who are YACPA members and hold the required practice permit from MIT.

To obtain the CPA qualification, Yemeni nationals must be at least 26 years old, hold a bachelor’s degree or higher in accounting, complete the required practical experience, pass the CPA examination unless exempted as a PhD holder, and provide evidence of good standing. Required practical experience is four years after a bachelor’s degree, two years after a master’s degree, or one year after a PhD. Candidates who meet these requirements must apply for YACPA membership as CPAs before applying to MIT for authorization to practice audit.

There is no independent public audit oversight authority in Yemen. Audit regulation and oversight responsibilities are shared between the Ministry of Industry and Trade (MIT) and the Yemeni Association of Certified Public Accountants (YACPA) under the Audit and Review of Accounts Law No. 26 of 1999 and Council of Ministers Resolution No. 51 of 2019.

MIT is responsible for oversight of the audit profession, including supervision of the quality assurance review system, adoption of international auditing and ethical standards, licensing of auditors, and establishment of the investigation and discipline framework. YACPA operates the quality assurance review system under MIT supervision and cooperates with MIT in relation to investigation and discipline matters and implementation support for professional standards.

At the time of the assessment, no independent audit oversight body meeting the membership criteria of the International Forum of Independent Audit Regulators had been established in the jurisdiction, and Yemen is not represented in IFIAR membership.

Yemeni Association of Certified Public Accountants (YACPA)

The Yemeni Association of Certified Public Accountants (YACPA) is legally recognized under the Audit and Review of Accounts Law No. 26 of 1999 as the mandatory professional association for public accountants in Yemen. The Law provides YACPA with legal personality and establishes membership in YACPA as a requirement for practicing as a public accountant.

YACPA represents the accounting profession in Yemen and advises the government on accounting and auditing standards. It participates in the Public Accountants Permit Committee, through which the Ministry of Industry and Trade exercises regulatory responsibilities for the profession.

YACPA’s responsibilities include participating in drafting regulations related to the profession, monitoring members’ compliance with ethical, accounting, and auditing standards, cooperating with MIT on investigation and discipline matters, organizing professional education and training, delivering continuing professional development, administering CPA examinations, maintaining the CPA registry, and operating the quality assurance review system under MIT supervision.

YACPA’s membership comprises accountants working in business, industry, and the public sector; auditors licensed by MIT; and partners in audit firms. YACPA also maintains member and practitioner directories and provides training and professional development activities through its website.

In addition to being an Associate member of the International Federation of Accountants, YACPA is reported to be a member of the Arab Federation of Accountants and Auditors and the Gulf Cooperation Council Accounting and Auditing Organization.

Council of Ministers Resolution No. 51 of 2019 introduced mandatory quality assurance (QA) reviews for statutory audits in Yemen. Under this framework, the Yemeni Association of Certified Public Accountants (YACPA) is responsible for establishing and operating the QA review system under the oversight of the Ministry of Industry and Trade (MIT).

The QA framework is intended to apply to statutory audits and is supported by the adoption of relevant International Auditing and Assurance Standards Board pronouncements, including International Standard on Quality Management 1, International Standard on Quality Management 2, and International Standard on Auditing 220 (Revised).

However, the QA review system does not yet appear to be fully operational. YACPA has undertaken capacity-building activities and has planned initial voluntary reviews, but there is no evidence that mandatory QA reviews are being conducted on a recurring basis for all statutory audits. Key elements required under SMO 1, including the review cycle, selection methodology, reviewer qualifications, reporting, remediation, and linkage of QA findings to investigation and discipline processes, have not yet been fully evidenced in practice.

Current Status: Partially Adopted

The Audit and Review of Accounts Law No. 26 of 1999 establishes general entry requirements for public accountants in Yemen, including a bachelor’s degree in accounting, prescribed practical experience, completion of a professional examination, and good standing requirements. Practical experience requirements are four years after a bachelor’s degree, two years after a master’s degree, or one year after a PhD.

The Yemeni Association of Certified Public Accountants (YACPA) administers the Certified Public Accountant examination and supports professional education and continuing professional development under the oversight of the Ministry of Industry and Trade. YACPA also participates in the regulation of the profession through the Public Accountants Permit Committee.

YACPA participated in an International Education Standards (IES) alignment project with IFAC and the International Panel on Accountancy Education in 2022 and identified gaps in alignment with the 2019 IES. Publicly available information does not indicate that these gaps have since been fully addressed. Accordingly, while the jurisdiction-level framework incorporates key entry, practical experience, assessment, and continuing professional development elements, it has not been demonstrated to fully align with the IES in effect at the time of the assessment or with SMO 2 requirements to support adoption and implementation of the latest IES.

Current Status: Partially Adopted

Council of Ministers Resolution No. 51 of 2019 requires the application of International Standards on Auditing (ISA) and related pronouncements issued by the International Auditing and Assurance Standards Board (IAASB) for all mandatory audits, beginning January 1, 2020.

The 2025 Handbook of International Quality Management, Auditing, Review, Other Assurance, and Related Services Pronouncements is the current IAASB Handbook and is available in Arabic.

At the time of the assessment, no evidence was identified that the International Standard on Auditing for Audits of Financial Statements of Less Complex Entities (ISA for LCE) has been formally adopted in Yemen. Council of Ministers Resolution No. 51 of 2019 adopts ISA and related IAASB pronouncements generally but predates the issuance of ISA for LCE.

Current Status: Adopted

Council of Ministers Resolution No. 51 of 2019 requires all professional accountants in Yemen to comply with the International Code of Ethics for Professional Accountants, including International Independence Standards, and related pronouncements issued by the International Ethics Standards Board for Accountants (IESBA).

The 2024 Handbook of the International Code of Ethics for Professional Accountants is available in Arabic through the IFAC Translations Database.

Current Status: Adopted

The Ministry of Finance and the Central Organization for Control and Auditing (COCA) are responsible for public sector accounting requirements in Yemen. Public sector entities continue to follow national public financial management and accounting requirements, including the Unified Accounting System. No evidence was identified that International Public Sector Accounting Standards (IPSAS) have been adopted for application by public sector entities.

Current Status: Not Adopted

The Ministry of Industry and Trade (MIT) is empowered under the Audit and Review of Accounts Law No. 26 of 1999, as amended in 2004, to establish a Disciplinary Council responsible for investigation and discipline (I&D) processes for professional accountants. The Law provides for disciplinary sanctions, including warnings, fines, suspension, and removal from the register, without prejudice to criminal or civil proceedings before the courts where applicable.

In September 2020, MIT approved a joint I&D mechanism between the Public Accountants Permitting Committee and the Yemeni Association of Certified Public Accountants (YACPA). Under this mechanism, complaints are referred to a joint Investigative Committee, and YACPA’s Disciplinary Council imposes sanctions on members with oversight from the Public Accountants Permitting Committee. The Disciplinary Committee was established and operationalized in 2021.

YACPA reports that it completed a gap analysis of the jurisdiction-level I&D framework against SMO 6 requirements in 2022 and identified areas for further alignment, including the scope of the system, initiation of proceedings, investigative and disciplinary processes, and public interest considerations. Publicly available information does not indicate that all identified gaps have been fully addressed.

Current Status: Partially Adopted

Council of Ministers Resolution No. 51 of 2019 requires International Financial Reporting Standards (IFRS) as issued by the International Accounting Standards Board (IASB) for application by public interest entities beginning January 1, 2020. Public interest entities include banks and financial institutions required to submit financial statements to the Central Bank of Yemen, and entities required to submit financial statements to the Ministry of Industry and Trade and the Tax Authority. Resolution No. 51 of 2019 also adopts the IFRS for Small and Medium-sized Entities Standard.

The IFRS Foundation jurisdiction profile confirms that IFRS are incorporated into law and regulation in Yemen through the Council of Ministers resolution, Ministry of Industry and Trade processes, the Public Accountants Permit Committee resolution, Tax By-Laws, and other regulations.

Current Status: Adopted

Relevant Organizations

Central Organization for Control and Auditing (COCA)

International Forum of Independent Audit Regulators (IFIAR)

IFRS Foundation – Yemen Jurisdiction Profile

Yemeni Association of Certified Public Accountants (YACPA)

Relevant Legislation

Audit and Review of Accounts Law No. 26 of 1999 (English Translation)

Council of Ministers Resolution No. 51 of 2019 on the Adoption of International Standards in Yemen

Relevant Publications

IFRS Foundation – Yemen Jurisdiction Profile (PDF)