Adoption of the Egyptian Accounting

  The Egyptian Accounting Standards have been endorsed by the Accountability State Authority.[1] Hence, public sector companies and public business sector companies are now officially required to follow these new accounting standards and to consider them as complementary to the Unified Accounting Standard. The Accountability State Authority The Accountability State Authority was first established in Egypt in 1942 as the Accountability Authority. It was later developed and various laws have been issued amending its structure and mandate. The last of these laws was issued in 1988^[2] stating the mandate of the Accountability State Authority (“ASA”) to be to undertake the financial and legal supervision of – among others – the central and local government units, all public sector entities including public sector companies, public business sector companies, and public authorities, private law companies which are at least 25% owned by the public sector. Other entities may also be financially and legally supervised by ASA if the constitutional laws of these entities state that they will be subject to the supervision of ASA. ASA is not only required to undertake the financial and legal supervision, but it is also required to supervise performance of the entities subject to its supervision and to follow up on the implementation of the government’s plan. The Unified Accounting System and the Egyptian Accounting Standards In order to facilitate the mandate of the ASA, a Unified Accounting System (“UAS”) was created in 1966^[3] to apply to all public economic units and the Head of ASA was given the power to form a committee that would be in charge of constantly reviewing the UAS and suggesting amendments thereto.^[4] In order to align the accounting rules followed by public and private companies and in order to further align with the international accounting practices, the Head of ASA endorsed the Egyptian Accounting Standards (“EAS”) as complementary rules to the UAS. This was first done in 1996 when the Head of the ASA issued a decision^[5] stating that the EAS shall be applicable to all public economic entities with the exception of those specifically exempted in the UAS. Most recently, the Head of ASA endorsed the latest version of the Egyptian Accounting Standards, which was issued by the Minister of Investment in 2015,^[6] and requires all entities subject to the supervision of ASA (and that are required to comply with the UAS) to comply with the EAS, being complementary to the UAS. Conclusion We note that the decision of the Head of ASA endorsing the 2015 EAS was issued in August 2016 but was only published in December. We also note that although the EAS are stated to be attached to the decree of the Head of the ASA, they were not published along with this decree. They were published along with the Minister of Investment Decree referred to above in 2015 in the Egyptian Gazette. A copy of the EAS can be obtained from the website of the ASA.     [1] ASA’s Decision No. 609/2016 adopting the accounting standards as a framework to complement the unified accounting system, Egyptian Gazette, Issue No. 281, 14 December 2016. ^[2] Law No 144/1988 on the Accountability State Authority, Official Gazette, Issue No. 23 (cont.), 9 June 1988. ^[3] Presidential Decree No. 4723/1966 adopting the unified accounting system. ^[4] Accountability State Authority’s Website, the Unified Accounting System, Available through this link (Arabic). ^[5] ASA’s Decision No. 2644/1996 issuing the accounting standards as a framework to complement the unified accounting system, Egyptian Gazette, Issue No. 215 (cont.), 23 September 1996. ^[6] Ministry of Investment’s Decision No. 110/2015 on the revised accounting standards, Egyptian Gazette, Issue No. 158 (cont.) (a), 9 July 2015.