REGULATORY FRAMEWORK FOR THE ACCOUNTING AND AUDITING OF FINANCIAL INSTRUMENTS IN UZBEKISTAN: A CLAUSE-LEVEL COMPARATIVE ANALYSIS WITH IFRS 9 AND ISA 540 (REVISED)

Abstract

Uzbekistan has transitioned from the voluntary application of International Financial Reporting Standards (IFRS) to a regulatory framework requiring public interest entities to maintain accounting records and publish audited financial statements in accordance with IFRS, while statutory bookkeeping continues to be governed by national accounting standards (NAS). This study examines the extent to which the regulatory framework in force as of October 2026 supports the accounting and auditing of financial instruments. Thirteen national regulatory acts, including laws, presidential and government resolutions, ministerial orders, and national accounting standards, were systematically mapped at the clause level against IAS 32, IFRS 9, IFRS 7, IFRS 13, and ISA 540 (Revised). The identified differences were classified into five categories: terminological, methodological, taxation-related, auditing-related, and institutional. Of the twelve methodological areas examined, one (foreign-currency revaluation) was found to be aligned, two were partially aligned, and nine were identified as requiring further regulatory and methodological harmonization. In particular, the national chart of accounts and NAS No. 12 do not explicitly incorporate IFRS 9 classification categories, the effective interest method, expected credit loss requirements, financial instrument modification, or hedge accounting. Furthermore, the tax framework does not recognize expected credit losses until the relevant debt is determined to be uncollectible. Although International Standards on Auditing have legal force, further development is required regarding an officially recognized state-language version, national guidance on auditing accounting estimates, and quality-control criteria applicable to such estimates. The study also identifies areas requiring clarification concerning the legal basis for IFRS reporting during the transition between the repeal of the 2020 mandate and the initial obligations established under the 2026 register, as well as the timely recognition of amended IFRS texts. Based on these findings, six groups of recommendations are proposed for consideration in the forthcoming law on accounting and financial reporting and the 2026–2030 audit development concept.