The World Bank Centre for Financial Reporting Reform (CFRR) located in Vienna, Austria, is part of the Governance Global Practice (GGP) of the World Bank Group (WBG). In collaboration with other units and regions of the GGP and other WBG global practices, the CFRR engages in supporting countries in strengthening their corporate financial reporting and auditing, and public sector accounting. These are core areas of engagement for the Governance Global Practice in the WBG. The CFRR supports client countries to build capable, efficient, open, inclusive, and accountable institutions by providing knowledge services and capacity development assistance. Services include analytical and advisory services, technical advice, knowledge sharing, and support to developing and strengthening institutions.
Economic growth is key to ending extreme poverty and boosting shared prosperity for developing countries. Growing economies create jobs, generate income, produce social benefits, and attract investments. However, to function optimally, economies and markets need correct, timely and reliable financial information.
Producing trustworthy financial information requires sound national accounting and auditing frameworks, adequate and realistic requirements, and effective mechanisms to ensure compliance. All these components build the foundation for transparent and accurate financial reporting processes.
Reliable corporate financial reporting gives investors and owners an accurate understanding of the financial viability and performance of businesses, provides detailed information for creditors to make informed lending decisions to help businesses develop and grow, and gives regulators a clear picture of financial institutions’ credit exposure.
Government activity can account for an important part of gross domestic product (GDP), and government assets and liabilities are usually substantial in all economies. It is therefore important that they are effectively managed and that governments are accountable for this management to their citizens, their representatives, investors and other stakeholders.
While trust in the accuracy of private sector financial reporting expands access to and reduces the cost of credit, trust in credible and transparent financial reporting of a well-managed public sector fosters a stable and positive environment for public and private investments leading to economic growth.
Enhanced supervision of the financial sector reduces the risk of crises in the financial sector and increases financial stability, allowing capital markets to develop and flourish.
The World Bank Group (WBG) recognizes the importance of strong corporate financial reporting and public sector accounting frameworks as part of a broad-based and sustainable development strategy. This is of particular importance to developing economies, whose strategic development goals include significant efforts to improve the business climate, increase access to finance, strengthen the financial sector, promote private sector-led growth and ensure the long-term sustainability of public finances. Effective financial reporting and public sector accounting systems therefore serve as a strong underpinning for a country’s development.
Through helping client countries to build strong accounting, reporting, and auditing practices, the Centre for Financial Reporting Reform (CFRR) promotes and contributes to sustainable and equitable private sector-led growth, strengthened governance and business accountability.
The CFRR offers a wide range of services to partner countries in the area of financial reporting and auditing:
Analytical and Advisory Services
The CFRR regularly conducts diagnostics to identify issues and problems in national financial reporting and audit systems and recommends solutions. Initial diagnostics are used as a baseline against which progress and the success of reforms can be assessed. In addition to country-specific diagnostic work, the CFRR produces publications on specialized areas of interest.
Our diagnostics form the basis for CFRR expert technical advice and detailed support through the different stages of reform implementation. This includes: supporting the development of legislative frameworks; encouraging institutional strengthening; promoting modern educational methods and tools; and building the capacity of local experts through our targeted technical assistance projects. We have supported several countries in establishing and/or strengthening public oversight bodies for the audit profession. We have also supported the development of quality assurance systems for external audits in many countries including Albania, Croatia, and the Czech Republic.
We promote the dissemination of knowledge and good practice, and the sharing of expertise among partner countries in many ways. Regular CFRR conferences convene ministers and other senior policymakers to assess reform progress and maintain ongoing commitment at the highest levels of government. We bring financial reporting enthusiasts from around the region together into thematic “communities of practice (CoPs)” in accounting and auditing, for example in areas such as education and standards. We also organize a wide range of face-to-face training workshops and virtual seminars. All the training and workshop materials, videos, and other relevant information are published on the CFRR website and disseminated through our newsletter.
Partnerships and Outreach
We cooperate closely with our global contacts and cultivate our extensive international, regional, and bilateral partnerships to benefit our partner countries. We promote the application of international benchmarks and standards with the support of global organizations such as IASB (International Accounting Standards Board), IAASB (International Auditing and Assurance Standards Board), IFAC (International Federation of Accountants), and OECD (Organization for Economic Co-operation and Development). The European Commission is a close partner and we work together to ensure that policy tools and advice are aligned with EU requirements. We engage with donors to secure funding to support our programs and partner countries’ reform efforts. We develop and build enduring contacts in all partner countries with dedicated teams assigned to each.
The CFRR specializes in a range of technical practices, which include:
- Accounting and auditing standards;
- Audit regulation and public oversight;
- Accountancy education and professional development;
- Public sector accounting;
- Financial reporting in banking and insurance sectors;
- Financial accountability, transparency and controls in state-owned enterprises.
The CFRR has helped client countries build new institutions and laws based on international standards, and upgrade capacity in our client countries. We use a robust process to identify countries‘ needs and to assist with the design and implementation of comprehensive reform programs:
- Robust diagnostic underpinnings, based on international and EU benchmarks, carried out to a very high standard of quality–the Accounting and Auditing ROSC (Reports on the Observance of Standards and Codes) assessments; Well-resourced, professionally supported, participatory client-driven action-planning processes to convert the high-level policy recommendations of the ROSC assessments into detailed, costed action plans for reform, supported by all the relevant stakeholders.
- Direct involvement of representatives/staff of the relevant EU and international institutions in the diagnostic and advisory dimensions of the program;
- Advisory services and technical assistance at both country and regional level; and
- Cutting edge and cost-effective knowledge management technology to share best practices across our partner countries.
The CFRR has organized in the period 2008–2019 over 200 events with a total number of about 8,000 participants, and 38 virtual workshops with over 2,100 participants. Additionally, the FRTAP programs run by the CFRR from 2009 to 2017 have trained over 33,000 participants. Regular CFRR conferences convene ministers and other senior policymakers to assess reform progress and maintain ongoing commitment at the highest levels of government. The CFRR facilitates “communities of practice (CoPs)”, bringing together groups of practitioners from participating countries to share knowledge, experiences and ideas on specific accounting and auditing themes, for example in areas such as education and standards. A wide range of face-to-face training workshops and virtual seminars are also regularly organized. All the training and workshop materials, videos, and other relevant information are published on the CFRR website and disseminated through a newsletter.