RESOLUTION OF THE CABINET OF MINISTERS OF THE KYRGYZ REPUBLIC

of January 14, 2026 No. 6

About approval of the Strategy of development for the corporate financial reporting and audit in the Kyrgyz Republic for 2026-2030

For the purpose of improvement of quality of the financial reporting and audit, expansion of availability of transparent and solid financial information, according to Item 112 of the Action plan of the Cabinet of Ministers of the Kyrgyz Republic for 2025 approved by the order of the Cabinet of Ministers of the Kyrgyz Republic of January 17, 2025 No. 18-r, Articles 13, of the 17th constitutional Law of the Kyrgyz Republic "About the Cabinet of Ministers of the Kyrgyz Republic" the Cabinet of Ministers of the Kyrgyz Republic decides:

1. Approve:

1) the Strategy of development for the corporate financial reporting and audit in the Kyrgyz Republic for 2026-2030 according to appendix 1;

2) the Actions plan on strategy implementation of development of the corporate financial reporting and audit in the Kyrgyz Republic for 2026-2030 (further - the Actions plan) according to appendix 2;

3) matrix of indicators of the Strategy of development for the corporate financial reporting and audit in the Kyrgyz Republic for 2026-2030 according to appendix 3;

4) assessment of resource cost of the Strategy of development for the corporate financial reporting and audit in the Kyrgyz Republic for 2026-2030 according to appendix 4.

2. To the state bodies of the Kyrgyz Republic involved in implementation of the Actions plan:

1) to take necessary measures for accomplishment of the Actions plan in full and at the scheduled time;

2) quarterly no later than the 15th following the accounting period to provide information on the course of accomplishment of the Actions plan in the Ministry of Economy and Trade of the Kyrgyz Republic for generalization.

3. To the Ministry of Economy and Trade of the Kyrgyz Republic:

1) to perform monitoring of implementation of the Actions plan;

2) quarterly no later than the 25th following the accounting period to provide the summarized information on the course of accomplishment of the Actions plan in Administration of the President of the Kyrgyz Republic.

4. To impose control of execution of this resolution on management of control of execution of decisions of the President and the Presidential Administration Cabinet of Ministers of the Kyrgyz Republic.

5. This resolution becomes effective after seven days from the date of official publication.

Appendix 1

to the Resolution of the Cabinet of Ministers of the Kyrgyz Republic of January 14, 2026 No. 6

The strategy of development for the corporate financial reporting and audit in the Kyrgyz Republic for 2026-2030

Chapter 1. Introduction

This Strategy of development for the corporate financial reporting and audit in the Kyrgyz Republic for 2026-2030 (further - Strategy) determines the purposes and the main directions of enhancement of the corporate financial reporting and audit in the Kyrgyz Republic for the short-term and medium-term periods, and also financial provision and mechanisms of realization of the provided actions.

This Strategy represents the strategic plan of actions of the second stage of reforms of the corporate financial reporting and audit in the Kyrgyz Republic following from the realized Strategy of development for the corporate financial reporting and audit in the Kyrgyz Republic for 2014-2020 approved by the order of the Government of the Kyrgyz Republic "About approval of the Strategy of development for the corporate financial reporting and audit in the Kyrgyz Republic for 2014-2020" of March 31, 2014 No. 191.

Investment appeal of the country and its integration into the foreign trade and other foreign economic relations substantially depend on as far as participants of the international market trust the financial reporting of the companies. With respect thereto one of the most important directions of reforming of the corporate financial reporting is building confidence in the corporate financial reporting by means of application of international accounting standards and regulation of quality of financial records audit.

At the same time the simplified requirements of the financial reporting for the small and medium companies which are capable to satisfy needs of owners of the companies and the markets are the most important element of development and growth of this segment of the companies in the Kyrgyz Republic.

Important task is adaptation to the changing economic conditions and accounting of needs of the foreign investors interested in large and perspective investment projects. This Strategy shall consider the potential of different industries of economy of the Kyrgyz Republic, and also provide accurate and transparent conditions for investment. Important aspect is demonstration of transparency and openness of the corporate financial reporting that implies active informing on opportunities and conditions for investors, and also on ensuring protection of their rights and interests.

This Strategy serves as reference point for development of the actions and programs directed to strengthening of the investment climate, improvement of business environment and creation of conditions for sustained economic growth.

Chapter 2. General analysis of situation

In 2020 strategy implementation of development of the corporate financial reporting and audit in the Kyrgyz Republic for 2014-2020 ended. The Strategy implementation of actions for 2014-2020 was enabled within the project on development of audit and the financial reporting of the World Bank (PRAFO, grant on the amount of 1235000 (one million two hundred thirty five thousand) US dollars) financed by the State secretariat of Switzerland on economic problems (SECO) in the Kyrgyz Republic.

In 2023 in economy of the Kyrgyz Republic financial and economic activities performed 29,8 of one thousand companies (organizations). Their activities were characterized by growth of number of operating plants, increase in amount of gross income, strengthening of material resources, growth of number of profitable enterprises, and also obtaining following the results of year of positive balanced financial result (profit). At the same time the tendency of growth of mutual non-payments of debts, increases in stock remainders of inventory items in warehouses remains, receipt of considerable amount of losses from not operating activiies is observed.

According to analytical data of National Statistical Committee "Finance of the companies of economy of the Kyrgyz Republic in 2023" the main number of the companies of economy - 29,1 of one thousand companies (percent 97,7 from total number of the companies) was the share of the real (non-financial) sector and 666 organizations (percent 2,3) - on the financial sector of economy. In industry section 32 percent from total number of the companies of economy performed activities in the field of trade, percent 12,6 - in industries, percent 10,7 - in construction, 9,2 of percent were the organizations of professional, scientific and technical activity (1).

According to the Law of the Kyrgyz Republic "About financial accounting" all subjects are divided on categories of conducting financial accounting and creation of the financial reporting: the subjects of public interest (SPI) and the subjects of big business (SBB) apply International accounting standards (further - IFRS), subjects of medium business - the International accounting standard to subjects of small and medium entrepreneurship (further - IFRS for MSP), small business entities - the simplified rules of accounting of financial accounting.

By the companies for accounting method for 2020-2023 and in 9 months 2024 distribution of the companies looks as follows.

Group of the companies (organizations) for accounting method for 2020-2024

These indicators confirm tendency of increase in number of the companies applying IFRS.

As audit standards in the republic since 2002 apply the International standards of audit (further - MCA) published by committee on the international audit practice of the International federation of accountants in New York.

IFRS and MCA are annually updated and published in English. In too time regulatory legal acts according to the legislation of the Kyrgyz Republic are subject to official publication in the state and official languages by reproduction of texts in the printing or electronic edition determined by the Cabinet of Ministers of the Kyrgyz Republic (further - KMKR).

For the purpose of creation of the regulatory legal base necessary for achievement of the corresponding law-enforcement practice in the Kyrgyz Republic in the field of financial accounting, the financial reporting and auditor activities, resolutions KMKR are accepted:

- "About approval of the Procedure for the organization and holding examinations, recognitions of length of service in audit area and financial accounting, issue of the qualification certificate of the auditor and recognition of internationally acknowledged qualification certificates in the field of financial accounting and audit" of January 11, 2024 No. 5;

- "About approval of the Procedure for accreditation of training programs of professional auditor associations" of March 25, 2024 No. 130;

- "About approval of Rules of conducting financial accounting by small business entities" of August 26, 2024 No. 505.

Events for digitalization of management and development of digital infrastructure, in particular on creation of public depositary of the financial reporting are held. 29287216 (twenty nine million two hundred eighty seven thousand two hundred sixteen) som are allocated for the "Public Depositary of the Financial Reporting" project approved by the order of KMKR of October 31, 2023 No. 663-r. Preparation of architecture of system is begun, in December, 2023 with GP Infoky the contract for 14513116,1 amount is signed (fourteen million five hundred thirteen thousand hundred sixteen whole one tenth) som, the specification is approved. 13061804 (thirteen million sixty one thousand eight hundred four) som according to the order of KMKR of April 12, 2024 are also in addition allocated to No. 151-r. Now development of frontend-and back end - parts of system is conducted.

The decision of the Supreme Eurasian economic council No. 22 of December 26, 2016 approves plans for liberalization of the single market of services in audit area and financial accounting. The Kyrgyz Republic together with state members works on their accomplishment, including the draft agreement on auditor activities within the Eurasian Economic Union (EEU) which was ratified on February 15, 2023 is developed and approved. At stage of development there is draft agreement on administrative cooperation in audit area which received the name "Agreement on Order of Interaction of Bodies of State Members of EEU". The "Agreement on the Harmonized Requirements to Service Providers in the field of the Reporting and Financial Accounting" project is also developed.

Interaction with the International Federation of Accountants (IFA), also with fund of international accounting standards board (IFRS Fund), the being developers of international standards, the Code of ethics of professional accountants is performed. IFRS and IFRS for MSP, MCA, the Code of ethics of professional accountants are translated into the Kyrgyz language and are in open entry.

The Kyrgyz Republic is included into the Coordination council on financial accounting under Executive committee of the Commonwealth of Independent States (further - the CIS) created for coordination of actions of the CIS countries in the field of financial accounting, audit and their harmonization with IFRS and MCA. In too time the Kyrgyz Republic, being member of the Intergovernmental working group of experts in international standards of accounting and the reporting (ISAR), interacts with the Conference of the United Nations (UN) on trade and development of "United Nations Conference on Trade and Development" (UNCTAD) - body of the United Nations General Assembly.

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