IFRS: What the Standards Are and Who Applies Them in Uzbekistan

Who applies IFRS in Uzbekistan from 2026

• public interest entities (PIEs) (Presidential Resolution PP-282): issuers listed on an exchange, banks, microfinance organisations, payment organisations, investment funds, exchanges; companies with a state share of 50% or more and large organisations — with assets and revenue of at least 1 million BCV for two consecutive years (for large organisations, also 500 or more employees) (Regulation No. 3736);
• PIEs are entered in the Register every year by July 1 and keep IFRS accounts from January 1 of the following year;
• others may switch voluntarily by notifying the tax authority by March 1; those who voluntarily prepare IFRS financial statements are exempt from reporting under national accounting standards (NAS) (PP-4611).

What IFRS are and how they differ from national accounting

National accounting has historically been oriented towards control: it answers whether a transaction is properly documented and whether taxes are calculated correctly. IFRS answer a different question — what economic picture the user of financial statements sees, be it an investor, a bank or the owner.

Hence the main difference: the international standards involve a lot of professional judgement. Measuring assets, recognising revenue, determining useful life — all of this requires a reasoned decision, not just a reference to a document.

The second difference is substance over form. If a contract calls a transaction one thing but in substance it is another, IFRS financial statements will reflect the substance.

How the system of standards is structured

The system consists of the earlier IAS standards, the later-generation IFRS standards and interpretations of them. In practice they are usually referred to by number: IFRS 1, IFRS 2, IFRS 3 and so on.

Keep in mind that standards are revised regularly and some are replaced by new versions. So when preparing financial statements always check the version in force at the reporting date, not notes from three years ago.

• IFRS 1 — first-time adoption of International Financial Reporting Standards
• IFRS 2 — share-based payment
• IFRS 3 — business combinations and accounting for acquisitions
• IFRS 5 — non-current assets held for sale and discontinued operations
• IFRS 6 — exploration for and evaluation of mineral resources
• IFRS 7 — financial instruments: disclosures
• IFRS 8 — operating segments
• IFRS 9 — classification, measurement and impairment of financial instruments

Who needs IFRS financial statements

The first group is companies for which IFRS reporting is required by law. The list of such organisations is set by regulations and is refined from time to time, so it should be checked against the current version.

The second group is those who switch to IFRS voluntarily. These are usually companies preparing to raise finance, enter foreign markets or sell a stake: an investor wants to read financial statements in a format they are used to.

The third group is groups of companies that need a consolidated picture. When a business consists of several legal entities, only consolidation under uniform rules shows the real result.

What changes in the company when moving to IFRS

The transition affects more than the accounting department. The set of data to be collected changes: requirements appear for information on contracts, terms, collateral and related parties. Some of this information was never recorded anywhere before.

The role of the accounting policy also changes. Under IFRS it stops being a formal document and becomes a working tool: it is where the chosen approaches to measurement and recognition are set out.

Finally, there is a need for disclosures. A large part of IFRS financial statements consists of notes, without which the figures are not considered complete information.

What a transition project looks like in practice

We start with a diagnostic: we look at current accounting, contracts and the group structure and identify the areas where differences from national accounting are most significant. Usually these are fixed assets, leases, financial instruments and revenue recognition.

Next, the methodology is developed — the IFRS accounting policy and the data conversion model. At this stage it is important to agree what the company does itself and what the consultant takes on.

Then the first IFRS financial statements and comparative figures are prepared, followed by training for the team so that the company can close the next reporting period on its own or with minimal support.

• diagnosing differences and estimating the scope of work
• developing an accounting policy under the international standards
• collecting additional data and adjusting processes
• conversion or parallel accounting
• preparing the financial statements and disclosures
• handing over the methodology to the company's team

Typical difficulties and how to resolve them

The most common problem is a lack of source data. The company discovers that a calculation under a standard requires information that was never collected in the accounts, and it is hard to reconstruct retrospectively.

The second difficulty is professional judgement. Where national accounting gives a ready-made rule, IFRS require justification, and that justification must be documented — otherwise the auditor cannot confirm it.

The third is trying to convert the financial statements mechanically, without revising processes. Such a conversion produces a report that looks fine on paper but falls apart at the first audit.

Why it is worth doing this with auditors

Leader Audit is an audit firm. Over 13 years of practice we have carried out more than 220 audits and work with companies across Uzbekistan.

Audit experience helps build financial statements that hold up under audit from the start: we know which judgements will need support and which disclosures usually turn out incomplete. This saves the company one or two rounds of rework.