Diagnostic Study of Accounting and Auditing Practices (Private …

Short Description
Accounting and Auditing Practices in Selected Developing Member Countries: A. Diagnostic Study of Azerbaijan, Fiji Islands, Marshall Islands, …

Website: unpan1.un.org | Filesize: 206kb

Content
9
I. Introduction
1. Study Background
growing body of compelling economic research reveals that
governance arrangements strongly influence development outcomes
including social indicators such as infant mortality and adult literacy
rates.
1. Sound accounting and auditing practices are an integral part of
good governance arrangements. There is strong evidence that sound
accounting and auditing mechanisms: (i) attract investment; (ii)
support financial market development; (iii) reduce country risk
premiums; (iv) improve privatization outcomes; and (v) lower the risk
of financial crises, but when crises do occur, reduce their severity and
duration.2
2. Moreover, the 1997-1998 Asian financial crisis exposed structural
weaknesses in the banking and corporate sectors of affected countries
owing largely to poor governance, a lack of transparency, and weak
supervision and regulation.3
3. The Asian Development Bank (ADB) has been taking a number of
initiatives to assist its Developing Member Countries (DMCs) to
overcome these structural problems. The focus on improved governance
includes enhancing the effectiveness of public administration and
development management at the sector level and in national
institutions. Where appropriate, institutional development of the local
and provincial agencies and the private sector is also covered. A sound…