According to the decision of the Board published in the Official Gazette on 26/08/2014, PIEs are required to apply TFRSs, in general. The definition of public interest entities has been made in Statutory Decree No. 660 in line with EU’s Audit Directive 2006/43/EC as “public interest entities are publicly held companies, banks, insurance, reassurance and pension companies, factoring companies, financing companies, financial lease companies, asset management companies, pension funds, issuers and other capital market institutions.”
Entities which will have to prepare their financial statements in accordance with local GAAP (in compliance with EU Directive 2013/34/EU)
For the entities other than public interest entities, in general, and subject to the Cabinet Decree (sets the criteria for entities that are subject to audit), the KGK has initiated efforts to establish local GAAP which will be in compliance with European Union Directive 2013/34/EU, in 2014. Financial Reporting Standard for Large and Medium-sized Entities (BOBI FRS) was published in the Official Gazette No. 30138 dated July 29, 2017 and will be applied for the reporting periods beginning on and after 1 January 2018.
This local GAAP will be applied by the entities that:
• are subject to audit and
• are not obligated to use TFRSs which are in compliance with IFRSs published by IASB.
In order to ensure audit to be qualified in Turkey, the KGK signed a copyright agreement with International Federation of Accountants (IFAC) in 2013. The auditing standard setting process has been conducted on the basis of IFAC’s Policy for Translating Reproducing Standards and consultation commissions and a review committee have been composed for the adaption of the standards.
The KGK has translated and implemented as Turkish Standards on Auditing substantially all of the suite of international auditing and audit-related standards as issued by the IAASB. The KGK has also translated and issued for publication the Code of Ethics as issued by the IESBA.
The projects for the revisions of standards carried by the Independent Boards within IFAC are closely followed and TSAs are also being revised on a timely basis.
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