The 2008 financial crisis that enveloped the main economies of the world brought a series of aftershocks to the system of financial regulation and oversight as well a significant number of criticisms to the financial reporting world in the use and relevance of the audit report. Post crisis, the G20 group of nations underscored the importance of both International Standards and the robustness of the audit report by insisting that harmonisation of the major economies in a financial reporting sense was essential to help mitigate against a crisis of similar proportions ever happening again.
While understandable, these criticisms nonetheless overshadow all of the positive aspects provided by an audit – especially in a country like Poland which is making significant progress with improving its capacity in international financial reporting because enhanced auditing mechanisms and its high quality that are standardized across the entire country can help foster transparency and trust - necessary conditions for attracting investment and bolstering the business environment in any country, including Poland.
In the nearly ten years since it joined the European Union (EU), Poland has made great strides in bringing its financial reporting policies in line with the EU’s vision of “smart regulation" – a platform that emphasizes the delivery of EU polices and laws capable of offering the greatest possible benefits to people and businesses in the most effective way. The most recent June 2013 new EU directive on accounting will have to be adapted to the Polish regulation within two years. Additionally, there is still room for advancement in implementing the provisions of the acquis in practice.
In particular, there is a need to improve the operation of the system of public oversight and to strengthen the capacity of the auditing profession to implement the provisions of the Statutory Audit Directive. The projects organized under Poland’s FRTAP program are designed to address these issues. Although the EU has not yet adopted universal auditing standards as part of its smart regulation agenda, policy makers in Poland have nonetheless worked to improve the country’s business environment - recognizing that by doing so they can better position the country to attract more foreign investment and provide the long-term capital necessary to create employment-generating activities. This, in turn, can help contribute to financial stability in Poland and facilitate long-term savings in the country.