Maldives

The financial accounting and auditing reporting framework in the Maldives is established under several laws.

Under the Companies Act of 2023and Income Tax Act, all registered companies are required to follow international accounting standards during the preparation of financial statements. The Maldives Chartered Accountants Act of 2020 establishes CA Maldives with the responsibility to adopt accounting standards. As of 2024, the latest IFRS and IFRS for SMEs are adopted in the Maldives. The Maldives Banking Act of 2010 requires all banks and financial institutions to comply with international accounting standards — also interpreted as IFRS. Under the Income Tax Act (regulation S.122), the accounting standards accepted by the Commissioner General of the Maldives Inland Revenue Authority (MIRA) are IFRS, IFRS for SMEs and standards adopted by the Accounting and Auditing Organization for Islamic Financial Institutions (AAOIFI). The Capital Market Development Authority (CMDA) as stated in its corporate governance code requires all listed companies on the Maldives stock exchange to prepare their financial statements in accordance with IFRS.

Under the Maldives Chartered Accountants Act of 2020, CA Maldives is responsible for establishing auditing standards. As of 2024, the latest ISA are adopted in the Maldives. The Regulation on Statutory Audit issued by the Auditor General’s office requires that financial audits of state-owned enterprises are conducted in line with the ISA. The Maldives Banking Act of 2010 states that external auditors must audit a bank’s operations on a consolidated basis in compliance with recognized auditing standards and any standards issued through regulation — this is interpreted as the ISA.

In the Maldives, under the Maldives Chartered Accountants Act, only Chartered Accountants (auditors) are regulated. The body responsible for regulating Chartered Accountants is the Institute of Chartered Accountants Maldives (CA Maldives). Other segments of the profession are not formally regulated, but individuals who are not auditors may choose to join CA Maldives. Membership is mandatory for auditors and voluntary for non-auditors.

Under the Maldives Chartered Accountants Act, CA Maldives is authorized to: register auditors and provide the services of a professional accountancy institute; protect the interests of the members of the institute and provide them with opportunities to work in the accountancy profession both at home and abroad; set curricula for financial accounting, management accounting, professional qualifications and accounting technician programs of the institute; authorize educational institutes in the Maldives to carry out the institute’s programs and conduct such programs on its own; establish and enforce mandatory financial accounting standards and auditing standards for the private sector; monitor compliance with financial accounting standards, auditing standards and the Code of Professional Conduct and Ethics governing private sector accounting and take necessary disciplinary action against persons registered with the institute that are in breach of these standards and the Code; and carry out such other functions as may be necessary to discharge the responsibilities assigned to the institute.

Additionally, under the Regulation for Statutory Audit & Assurance Services, CA Maldives is responsible for regulating audit and auditors in the Maldives. Its functions include issuing licenses to conduct statutory audit in Maldives; revoke licenses; develop the audit profession; adopt relevant standards; monitor and ensure license holders maintain discipline and assist in further improving their conduct; ensure quality of the statutory audits conducted in the Maldives and provide assurances to relevant stakeholders, and general public; and ensure that statutory audits are conducted within the laws and regulation of the Maldives.

A national professional accountancy program and qualification does not exist and professional accountants in the jurisdiction are already qualified and hold membership with specific foreign institutions that are members of IFAC. These institutions include ACCA, CIMA, CPA Australia, CAANZ, AICPA, CA Sri Lanka, ICAI India, ICAEW, and CIPFA. CA Maldives is responsible for registering and maintaining a registry of auditors in Maldives who hold qualifications with these organizations.

CA Maldives recognizes two type of members–Associate and Fellow:

• Associate Members must be a member in good standing of an IFAC Member.
• Fellow Members must be a member in good standing of an IFAC Member, and have worked either in public practice, in the commerce industry, as a lecturer at an institution of higher education, or as an accountant in business for a period of at least five years.

There is no independent audit oversight authority in the Maldives. Under the Regulation for Statutory Audit & Assurance Services, the Institute of Chartered Accountants Maldives (CA Maldives) is responsible for regulating auditors in the Maldives as described in the Regulation section.

Institute of Chartered Accountants of the Maldives (CA Maldives)

With the ratification of the Chartered Accountants Act of 2020, CA Maldives was established as the body with the legal mandate and responsibility to regulate and develop the accountancy profession in the Maldives. CA Maldives membership consists of both accountants and auditors, and membership is mandatory for all auditors and voluntary for non-auditors. CA Maldives objectives defined as: regulate and develop the accountancy profession; facilitate the acquisition of requisite knowledge, training, and resources for the members of CA Maldives; ensure that accounting professionals working in private and public sectors possess the relevant knowledge and experience in the accountancy field; enable persons from the accountancy profession that work in the private sector to maintain their independence; formulate a Code of Professional Conduct and Ethics to be followed by persons registered with the Institute and ensure compliance with such; and carry out other functions as may be necessary to develop and promote the accountancy profession in the Maldives.

CA Maldives is a member of the South Asian Federation of Accountants (SAFA) and the Asia-Oceania Standard-Setters Group (AOSSG).

Under the Maldives Chartered Accountants Act of 2020 and the Regulation for Statutory Audit and Assurance Services in the Maldives (2021), the Institute of Chartered Accountants of the Maldives (CA Maldives) is responsible for establishing and conducting the quality assurance review function. The Audit and Licensing Committee (ALC) of CA Maldives is tasked with this function.

As of 2024, CA Maldives reports that its Quality Assurance Review (QAR) framework has been developed following the SMO 1 benchmark but is not yet operational. Plans are in place to operationalize the QAR. The relevant standards—ISQM 1, 2, and ISA 220 (revised)—are also adopted.

Current Status: Partially Adopted

Under the Maldives Chartered Accountants Act of 2020, CA Maldives is responsible for establishing IPD and CPD requirements. The Act provides CA Maldives as the body responsible for establishing entry requirements into the profession.

A national professional accountancy program and qualification does not yet exist and professional accountants in the jurisdiction are already qualified and hold membership with specific foreign institutions that are members of IFAC. These institutions include ACCA, CIMA, CPA Australia, CAANZ, AICPA, CA Sri Lanka, ICAI India, ICAEW, and CIPFA. The CA Maldives Membership Regulation R-121 of 2020 establishes the criteria for membership, rights and obligations of members, and the procedure for membership application, rejection, and removal of members.

As CA Maldives completed its application for IFAC membership, the institute completed IFAC’s Accountancy Education Self-Assessment and reports ongoing progress to align with the IES. CA Maldives offers its own CPD training and related seminars for its members. CA Maldives reports that the government has established a policy and plans to localize the accountancy profession and the IES will be referenced in any further progress to this initiative.

Current Status: Partially Adopted

Under the Maldives Chartered Accountants Act of 2020, CA Maldives is responsible for establishing auditing standards in the Maldives. As of 2024, the latest ISA are reported to be adopted.

Current Status: Adopted

Under the Maldives Chartered Accountants Act of 2020, the Institute of Chartered Accountants of the Maldives is responsible for adopting ethical requirements.

CA Maldives states it adopts the International Code of Ethics for Professional Accountants as issued by IESBA.

Current Status: Adopted

Under the Public Finance Act of 2006, the Ministry of Finance is responsible for setting public sector accounting standards in the Maldives. The scope of application includes the national government, local government, government ministries, departments, programs, commissions, agencies, and international government organizations. As of 2024, the government of Maldives has adopted cash-basis IPSAS and is currently undertaking a four-year project to move to accrual-basis IPSAS. The first set of financial reporting on accrual accounting is targeted to be completed by 2025.

Current Status: Partially Adopted

The Maldives Chartered Accountants Act of 2020 provides the Institute of Chartered Accountants of the Maldives (CA Maldives) with the responsibility to establish an investigation and disciplinary (I&D) system for professional accountants in the Maldives. The Council, Ethics Committee, Appeals Committee, and the management team of CA Maldives is responsible for managing this system, which CA Maldives reports is fully compliant with SMO 6 requirements.

Since its establishment, CA Maldives has been drafting regulation and related guidance on Complaint Handling and Conducting Investigations, and a Rules of Procedure of the Ethics Committee. It is expected that the draft guidance will be published in 2024.

Current Status: Partially Adopted

Under the Companies Act of 2023 and Income Tax Act, all registered companies are required to follow international accounting standards during the preparation of financial statements. The Maldives Chartered Accountants Act of 2020 establishes CA Maldives with the responsibility to adopt accounting standards. As of 2024, the latest IFRS and IFRS for SMEs are adopted in the Maldives. The Maldives Banking Act of 2010 requires all banks and financial institutions to comply with international accounting standards — also interpreted as IFRS. Under the Income Tax Act (regulation S.122), the accounting standards accepted by the Commissioner General of the Maldives Inland Revenue Authority (MIRA) are IFRS, IFRS for SMEs and standards adopted by the Accounting and Auditing Organization for Islamic Financial Institutions (AAOIFI). The Capital Market Development Authority (CMDA) as stated in its corporate governance code requires all listed companies on the Maldives stock exchange to prepare their financial statements in accordance with IFRS.

Current Status: Adopted

Relevant Organizations

Institute of Chartered Accountants Maldives

Auditor General’s Office Maldives

Relevant Legislation

Audit Licensing and Assurance Regulation

Companies Act

Chartered Accountants Act

CA Maldives Members Regulations

Regulation for Registration of Accountants in Business

Regulation for Registration of PIE Auditors

Relevant Publications

CA Maldives, SMO Action Plan, 2024.

IFRS Profile: Maldives, September 2017