MASERU — The Lesotho Institute of Accountants (LIA) says it is important for Lesotho to adopt international accounting standards to improve financial reporting standards.
Moahloli Mphaka, a technical manager with the LIA, said it was crucial to adopt the latest financial reporting standards to ensure that the country is not left behind.
Mphaka was speaking a day after the institute held a one-day workshop in Maseru which was organised to discuss and review the latest international accounting standards.
“Financial reporting standards are always changing depending on the changes in the economy,” he said.
“There is a drive for global convergence towards the same standard of reporting all over the world so we make sure that we are not left behind.”
Mphaka said the LIA wants all its members to comply with the latest international financial reporting standards.
“We believe that members should be up to date with the developments of the international financial reporting standards,” he said.
Mphaka said the global financial meltdown experienced in 2008 had created havoc in the global economy and had resulted in changes in the financial reporting standards.
He said the idea behind adopting new financial reporting standards whenever they are changed is to make sure that local accounting standards are on par with the rest of the world.
“We want to make financial reporting standards to be user-friendly both for the practitioners and the investors as the investors both local and international are the ones developing the economy of every country,” Mphaka said.
“One of the advantages of using the international financial reporting standards is to help attract international investors into the country as it will be easier for them to refer to financial information reported locally to make decisions as the standards are the same.”
He said accountants have to have fully rounded skills that will allow them to facilitate the smooth growth of businesses and make informed decisions towards increased economic performance.
Mphaka said Lesotho was a member of the International Federation of Accountants (IFAC) which regulates accounting standards worldwide.
Lesotho is also a member of the Eastern, Central and Southern Africa Federation of Accountants.
Mphaka said the LIA’s main mandate is to protect and safeguard the interests of the public.
“The high quality of financial reporting standards that we are always striving for are targeted mainly at protecting the interests of the public to help improve economic growth through application of high quality standards and ensuring adherence to high standards in the businesses and the public sector,” Mphaka said.
Currently there are about 41 new standards of financial reporting, and nine of those standards that are published by the IFAC through the international accountancy board have been adopted by Lesotho.