The critical shortage of certified actuaries and valuators is expected to be addressed as Parliament approves establishment of Ethiopian Institute of Certified Public Accountants last week. The Institute will achieve this by training and certifying professionals in International Financial Reporting Standards (IFRS), ultimately improving the country's financial reporting standards. Currently, Ethiopia has only 500 internationally certified auditors, with less than half certified by the Accounting & Auditing Board of Ethiopia (AABE). The AABE will oversee the new institute, which will regulate, certify, and monitor accounting students and professionals, ensuring compliance with the International Federation of Accountants (IFA). Revenue will be generated through annual membership fees, sponsorships, donations, and school fees. The lack of certified auditors has forced local companies, particularly banks and insurance firms, to outsource auditing services to international firms. This new institute aims to rectify this reliance on foreign expertise. The establishment of this institute brings Ethiopia in line with regional standards. Kenya, for instance, established a similar institute in 1978 and now boasts 45,000 certified accountants. The need for qualified accountants has become increasingly urgent in Ethiopia following the launch of its capital market, as listed companies are required to report financial statements under IFRS.
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