Prom Audit Uzbekistan assists with IFRS reporting in a landscape of reform

Zoya Malik speaks to Doniyor Islamov, CEO and managing partner at PrimeGlobal member firm Prom Audit, about ease of doing business and the development of the accountancy profession in Uzbekistan 

Zoya Malik: What is the business climate like in Uzbekistan in terms of ease of doing business for foreign companies?

Doniyar Islamov: Uzbekistan is the largest country in Central Asia, with a population of 34 million. It is a young economy, with the average age of the population at 25 years, and vast natural resources such as gold, gas, zinc and uranium.

For the longest period, the country has been a closed economy with a significant role for state-owned enterprises (SOEs). In 2016, a new president of the country was elected and since then large-scale reforms aimed at unlocking its potential have been implemented, including:

  • Currency liberalisation;
  • Foreign direct investments support (free repatriation in hard currency);
  • Tax reforms;
  • International trade easing;
  • Investments in infrastructure;
  • Privatisation and transformation of SOEs;
  • Stimulation of entrepreneurship.

All these reforms, and many others supported by International development institutions, have had a profound impact in attracting investment inwards into Uzbekistan and have impacted its growth.

The World Bank Doing Business rankings have improved, moving Uzbekistan from 87th to 69th place. Even in 2020, Uzbekistan was one of the rare countries in the world to record 1.6% GDP growth.

Doniyor Islamov, CEO and managing partner, PrimeGlobal member firm Prom Audit

ZM: What are regulators doing to raise accounting industry standards?

DI: Reforms were also made in the field of reporting and transitioning to IFRS. Starting in 2021, all companies with an annual revenue of over $1m must implement IFRS reporting.

This is a significant challenge for the country, due to limited human resources with necessary capabilities. The Ministry of Finance is doing a great job by arranging training on IFRS, translating accounting standards to the Uzbek language, but there is still a lot more to do.

ZM: What is unique about the services offered by the firm in Uzbekistan? 

DI: Our firm, Prom Audit, is one of the leading audit firms in the country, operating since 2005.

In 2020, a new team took over the leadership of the company. The team combines both strong international and local backgrounds with experience in audit and consulting services from Big 4 companies.

ZM: What is the firm in Uzbekistan doing to ensure audit quality, compliance and reporting?

DI: Our goal is to support local companies to transition to IFRS as well as consult international companies with local accounting and tax rules.

Currently our client portfolio not only includes the largest mining, manufacturing and transportation companies, but also international financial institutions providing loans to support the local economy.

By implementing international best practices in methodology, quality control and technology, we are aiming to be ranked amongst the top-five Uzbekistan audit firms in the next three to five years.

Uzbekistan is the largest country in Central Asia, with a population of 34 million

How well is the firm supported by PrimeGlobal in terms of tech support, lead generation and referrals?

DI: We have only recently joined PrimeGlobal. For us, it is a great honour to join one of the top international associations and to be the first representative from Central Asia.

We believe that our clients, and the Uzbekistan market as a whole, will benefit from the professional insights gained from PrimeGlobal. Our clients and other PrimeGlobal firms’ clients will also benefit from excellent services both locally and globally.

We have already started to receive leads from PrimeGlobal members, and are collaborating with the partners in terms of joint projects.