Overview

The Road to Europe: Program of Accounting Reform and Institutional Strengthening (REPARIS) was a regional program aimed at creating a transparent policy environment and effective institutional framework for corporate reporting within South Central and South East Europe, implemented by the CFRR from 2008 to 2014. Participating countries/entities included Albania, Bosnia and Herzegovina, Croatia, Kosovo, Former Yugoslav Republic of Macedonia, Moldova, Montenegro, and Serbia.

REPARIS began the process of introducing, implementing, and effectively enforcing the relevant portions of the EU acquis communautaire with a view to contributing to foreign direct and portfolio investment, fostering private and financial sector developments, improving the business environment and investment climate, and facilitating potential integration into (or harmonization with) the European Union.

A successor program, EU-REPARIS, launched in 2015 to continue this process. Funded by the European Union, as an integral part of the Western Balkans Enterprise Development and Innovation Facility, EU-REPARIS continues to support EU enlargement candidate, and potential candidate, countries in Southeast Europe align their legislative framework more closely with the EU. A previous program, the Advanced Program in Accounting and Auditing Regulation, set the foundation for the two REPARIS programs in 2006.

Project features

Objectives

The key interventions under REPARIS included strategic input on:

• drafting and phasing-in of legal and regulatory instruments to comply with the acquis;
• institutional design and operating procedures; and
• design of ongoing education and training programs, both academic and professional.

In addition, the Program included twinning arrangements with leading foreign institutions, as well as the establishment and start-up support of a network of regulators, standard-setters, and officials from participating countries.

On a global level, the World Bank plays a leading role in advising countries on accounting and audit regulation. The international community has emphasized the important role of international standards in strengthening the international financial architecture. In this context, the World Bank is the international institution charged with assessing countries’ systems of accounting and auditing regulation through the Reports on the Observance of Standards and Codes (ROSC) Accounting and Auditing Program. The ROSC Accounting and Auditing Program was established to assist countries in implementing International Financial Reporting Standards and International Standards on Auditing in order to strengthen their financial reporting regime. For first and second wave accession countries, the ROSC assessments have been carried out in close cooperation with the European Commission and these ROSC reports has formed the analytical and diagnostic underpinning for the REPARIS initiative. The REPARIS program was built on the robust analytical underpinning, the ROSCs, and a systematic approach to the development of a multi-faceted reform program.

Approach & Benefits

The REPARIS Program was designed around the introduction, implementation, and effective enforcement of relevant portions of the EU acquis communautaire with a view to contribute to foreign direct and portfolio investment, foster private and financial sector developments, and facilitate eventual integration into (or harmonization with) the European Union. Importantly, the program was built on a robust analytical underpinning, the A&A ROSC and a systematic approach to the development of a multi-faceted reform program.

The REPARIS Program contributed to long-term prosperity by promoting private and financial sector growth and reducing volatility through:

• Strengthening financial architecture and reducing the risk of financial market crises and their associated negative economic impacts.
• Promoting foreign direct and portfolio investment and helping to mobilize domestic savings.
• Allowing investors, both domestic and foreign, to better evaluate corporate prospects and make informed investments and voting decisions, which will result in a lower cost of capital and a better allocation of resources.
• Facilitating smaller-scale corporate borrowers’ (e.g., micro, small and medium enterprises) access to credit from the formal financial sector by lowering high costs of information and borrowing.
• Facilitating potential integration into the European Union.