IBRD, Azerbaijan sign new credit agreement

IBRD, Azerbaijan sign new credit agreement
# 26 September 2008 14:06 (UTC +04:00)
Also an agreement letter on the Japanese grant to co-finance the project was inked in Baku.
The credit agreement was signed by Samir Sharifov, Azerbaijan’s Minister of Finance, and Gregory Jedrzejczak, World Bank Country Manager for Azerbaijan.
The US$11 million credit has a maturity of 35 years with a grace period of 10 years.
The main aim of the project is to strengthen accountability and transparency in financial reporting for the public and corporate sectors in line with international best practices. The key beneficiaries are the Public Interest Entities including State-Owned Enterprises, the Chamber of Accounts (the country’s supreme audit institution), the Chamber of Auditors (the country’s auditing services regulator and standard-setter), the Ministry of Finance, and accounting and auditing professionals and stakeholders in Azerbaijan.
The IBRD Specific Investment Credit will finance US$11 million of the estimated total project cost o f US$24 million. The balance of US$13 million will be provided by Government counterpart finding of US$8 million; and a Japan Policy and Human Resource Development (PHRD) Co-financing Grant of US$3 million which will support embedding IFRS in PIEs. A Swiss Government/SECO Grant will extend US$2 million to finance the strengthening of public sector accountability.
There are four components to the project. The first component is the Corporate Sector Component. This component would support the corporate sector in implementing appropriate accounting standards; ensure the sustainability and transparency of these interventions through the establishment of appropriate legal and institutional frameworks; and strengthen the statutory audit function. The second component consists of Public Sector Accountability. This component aims to enhance public sector accountability through the implementation of the Government’s public sector accounting reform strategy, being the strategy currently being drafted to implement that part of the accounting Law that requires budget organizations and off-budget state funds to prepare financial statements in accordance with National Accounting Standards for Budget Organizations which in turn are based on International Public Sector Accounting Standards.
The third component consists of strengthening accounting, auditing and financial management capacity.
This component will build long-term capacity in accounting, auditing and financial management. It will include the creation of an Azerbaijan Center for Professional Accounting, Auditing Training Education and Research (ACPATER) which will be subordinate to the Ministry of Finance, and have broad responsibility for strengthening Azerbaijan accounting, auditing and financial management capacity, including the implementation of this component. Finally the fourth component consists of project management.