Non-compliances Identified as a Result of Financial Statements Reviews and Review Priorities – Fourth Edition

In order to promote the improvement of the quality of financial statements, SARAS, taking into account the practice of the European Union, annually reviews the financial statements submitted by entities. It also indicates the priorities and approaches to which it will pay particular attention during the review of financial statements. With this in mind, each year SARAS prepares documents on the non-compliances identified as a result of the review of financial statements and review priorities.. This year, SARAS has decided to present the above documents in a unified form and, at the same time, to consider the characteristics of high-quality financial statements according to which entities should prepare annual general purpose financial statements. 
The document describes the main non-compliances identified by SARAS in the process of reviewing the compliance of the 2021-2022 financial statements with the IFRS standards in 2023. In particular, the document summarizes the non-compliances identified as a result of the review of the 2021-2022 financial statements submitted by PIEs and part of I and II category enterprises (8% of the total number of PIEs, 9% of the total number of I category enterprises, 5% of the total number of II category enterprises).

Taking these results into account, the entities will be able to present high-quality financial statements. In the part of identified non-compliances, SARAS provides relevant recommendations for the entities and indicates the ways of eliminating such non-compliances with IFRS standards in the financial statements. At the same time, the trends of increase/decrease of the identified non-compliances in comparison with the non-compliances of the previous reporting period have been analyzed, which makes the document more informative and valuable. It also provides information on the priorities and approaches to which SARAS will pay particular attention when reviewing the 2022 and 2023 financial statements. In addition, it describes the criteria that SARAS will use to select the submitted and published financial statements for the review.

We would like to remind you that the process of submitting and publishing financial statements continues. Entities are required to submit their financial statements for the 2023 reporting period immediately, as soon as they are available, but no later than 9 months after the end of the reporting period, on the reporting portal https://rms.reportal.ge/.  

SARAS believes that the availability of transparent, high quality, timely and reliable corporate information in a central space enhances the confidence and security of investors, creditors and other interested parties, which in turn contributes to the development of the capital market and improves access to finance for entities. 
Timeliness of reporting is extremely important for the development of capital markets and the improvement of access to finance. By submitting reports on time, you create a reliable and transparent image for your organization, help to find investors and increase the potential for a reliable partnership with the banking sector. 

Non-compliances Identified as a Result of Financial Statements Reviews and Review Priorities – Fourth Edition