This report is based on the findings ofa review of accounting and auditing standards and practicesin Colombia. The review exercise focused mainly on thestrengths and weaknesses of the institutional framework thatsupports a corporate financial reporting system in thecountry. The current legal and regulatory requirements onaccounting have led to issuance of conflicting accountingstandards from multiple sources. Legal arrangements thatgave various regulatory bodies the right to determine theaccounting requirements for entities within theirjurisdiction have led to the predominance of special-purposefinancial reporting. This report provides policyrecommendations to improve accounting and auditingpractices, including strengthening enforcement mechanisms toensure compliance with accounting and auditing requirements,and a professional code of ethics for auditors. In thiscontext, it is recommended that a statutory regulatory bodybe established. Other policy recommendations include thecreation of a Higher Council that would be responsible forissuing international accounting and auditing standards aslocal mandatory requirements for public interest entities;establishing a new professional organization for auditors offinancial statements; reforming accounting curriculum andimproving significantly the teaching capacity of accountinginstructors at universities; and organizing trainingprograms on practical aspects of international auditingstandards for accountants, auditors, and others.
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