الهيئة العامة للرقابة المالية

• Application begins on January 1, 2027, marking a shift to global standards and a commitment to higher levels of financial statement transparency and integrity.
• Auditing standards serve as the essential foundation for examining and validating that financial statements strictly adhere to approved principles.
• 46 new standards are introduced, systematically organized into three main sections: Auditing, Review and Other Assurance Engagements.
• Crucial new Quality Control Standard is issued, mandating that audit firms establish rigorous systems to guarantee strict adherence to all professional standards and legal/regulatory requirements.
• Public Interest Entities (PIEs) must comply with the full, comprehensive standards, while Small Enterprises benefit from simplified, scaled-down standards tailored to their resources.
• The standards update is a strategic step to consolidate confidence in financial reports and enhance Egypt’s position as a regional center for investment.

In line with its pioneering role in developing the regulatory and organizational framework for Non-Banking Financial Markets , FRA led the efforts to prepare and update the Egyptian Standards on Auditing, Limited Review and Other Assurance Engagements. This is a qualitative step aimed at enhancing the quality of financial reports and raising the levels of transparency and governance in the Egyptian business environment.

Following the meticulous work conducted by the Standards Committee, led by FRA Chairman Dr. Mohamed Farid, Prime Minister Dr. Mostafa Madbouly issued Decree No. 3725 of 2025. This landmark decree officially implements the new standards, pivotal to aligning local professional practices with international benchmarks which will significantly bolster confidence in financial data and attract crucial investment to Egypt.

Egyptian Accounting Standards and Auditing Standards function as two integrated, essential pillars that jointly underpin the integrity and transparency of the financial system. Accounting Standards are the fundamental rules and bases that dictate how financial statements are prepared and how an entity’s financial position and performance are presented. Their primary purpose is to ensure that financial information is accurate, consistent and readily comparable across different entities and periods.

Conversely, Auditing Standards provide the necessary framework for verification. These standards govern the professional procedures and controls utilized by auditors during the examination of those financial statements, thereby assuring their compliance with the approved Accounting Standards. Auditing Standards are recognized as a primary tool for enhancing trust in financial information, guaranteeing both the objectivity and the quality of corporate reports. This rigorous assurance process, in turn, contributes directly to consolidating the principles of governance and transparency, protecting investor rights, supporting the overall efficiency and stability of financial markets and the national economy.

The release of these updated standards addresses a substantial 17-year gap since the last update to the Egyptian Auditing Standards, previously enforced under the Minister of Investment’s Decree No. 166 of 2008. The new Prime Minister’s Decree ensures a definitive transition by stipulating the cancellation of the former standards effective on or after January 1, 2027, thereby commencing the full, phased application of the new framework.

This major update is not merely an administrative change; it is a strategic necessity designed to keep pace with fundamental changes in global auditing and financial review standards. The core objective is to bridge the professional and regulatory gap between Egypt’s previous framework and its international counterparts. The new standards will dramatically enhance the transparency and reliability of financial statements issued by Egyptian companies. This move is crucial for accommodating current economic developments, supporting the national economy’s increasing openness to global markets, and facilitating the continued growth of cross-border financial and investment transactions.

As the Egyptian economy rapidly integrates globally, its business landscape is becoming highly interconnected. This rising openness creates a complex web of international trade and investment. Consequently, updated Egyptian Standards are imperative to address these relationships and align with the need for globally consistent regulations. Numerous domestic companies operate with branches and subsidiaries outside Egypt and also , a significant number of foreign companies maintain branches or wholly-owned subsidiaries within the Egyptian market.

Furthermore, the shares of several Egyptian and multinational entities are actively listed and traded on both local and international stock exchanges. Due to this cross-border activity, investors and market participants critically rely on the financial data, statements and crucially, the accompanying auditors’ reports. This reliance necessitates that Egypt’s professional standards must be updated. The modernization is therefore an absolute necessity to guarantee consistency with international standards and to effectively meet the rigorous demands for transparency and disclosure inherent in the modern cross-border business environment.

The new edition of the Egyptian Standards on Auditing, Review and Other Assurance Engagements establishes a comprehensive framework comprising forty-six standards across three primary sections. The first section is dedicated to the core functions, including a standalone standard for Quality Control and thirty-seven Auditing Standards. The second section addresses engagements requiring varying levels of assurance, featuring one standard for Review Engagements, five for Other Assurance Engagements, and two for Related Services Engagements. Finally, the third section provides essential supplementary publications and guides to support the practical application of the standards.

This organized structure is designed to promote greater integration across all professional and regulatory tasks. By clearly defining the application scope for each standard based on the engagement’s nature and the entity’s size, the new framework ultimately aims to enhance the efficiency and quality of all audit and oversight activities within the Egyptian business environment.

A key highlight of this new edition is the inclusion of an updated and entirely new standard for Quality Control specifically governing auditors’ work. This standard is mandatory, requiring every professional firm or office to implement an integrated system of quality control. The system’s purpose is to ensure the firm and its personnel adhere to all prevailing professional, legal and regulatory requirements. Crucially, it mandates the application of effective internal control systems to build a high level of confidence in issued financial reports, thereby guaranteeing that all reports—whether for auditing or other assurance engagements—are both appropriate for the circumstances and reliable in their content.

The new standards significantly reinforce the requirements for documenting audit evidence, particularly in areas considered high-risk. This includes crucial judgmental areas such as accounting estimates, the assessment of the entity’s ability to continue, identifying and responding to Fraud Risks, and evaluating the quality of the financial information systems used in preparing statements. This focus on rigorous documentation directly contributes to boosting the accuracy and credibility of audit findings.

A major update involves evolving the form and content of auditors’ reports to increase public transparency. For companies listed on the stock exchange, the standards introduce the Extended Audit Report (or Long-Form Report). Critically, this new model mandates the disclosure of Key Audit Matters (KAMs).

To ensure sustained high performance, the new edition actively promotes the integration of modern technological tools into the audit process. Audit firms are encouraged to adopt advanced computer systems, utilize Data Analytics systems and implement Electronic Auditing techniques. Furthermore, the standards push firms to establish specialized internal departments for Quality Control and Information Technology. This technological and structural push is intended to support the overall efficiency of the oversight process and elevate the quality of professional performance across the board.

Dr. Mohamed Farid, FRA Chairman expressed strong support for the new standards, affirming that the Prime Minister’s decree is a pivotal step for the Egyptian auditing profession. Dr. Farid emphasized that this move is key to improve the quality and efficiency of audit work, ensuring Egypt operates in accordance with the best international practices and standards.

Dr. Farid further explained that the issuance of the updated Egyptian Auditing Standards supports disclosure and transparency and improve the credibility of financial statements for companies and institutions operating across various economic sectors. This, in turn, will have a positive impact on the confidence of both local and international investors in the national economy. Ultimately, it supports FRA’s efforts to build a disciplined financial market founded on the principles of integrity, efficiency and sustainability.

FRA Chairman took the opportunity to express his deep gratitude to Standards Committee which was established by a Prime Ministerial decree and operates under FRA’s supervision. He also acknowledged the significant contributions of the dedicated working team comprised of FRA members. This collective, diligent effort was crucial in developing and updating the Egyptian Auditing Standards, ensuring the new framework not only addresses local and international changes but also fully keeps pace with the demands of the modern business environment.

Dr. Mohamed Farid affirmed FRA’s unwavering belief in the pivotal role of robust auditing standards as the foundation for enhancing confidence in corporate financial data. By mandating the highest degrees of objectivity, independence and accuracy, these standards ensure that all stakeholders -from investors to regulatory bodies – can rely on financial information to make sound, informed decisions. He added that the release of these updated standards marks a crucial continuation of national efforts to modernize Egypt’s regulatory and professional ecosystem. By fostering seamless integration between accounting and auditing standards, FRA is solidifying the pillars of transparency and accountability. This systemic improvement is strategically designed to enhance the capability of both public and private sectors to effectively address economic challenges and drive the nation toward sustainable development.

Financial Regulatory Authority views this standards’ update as a landmark achievement in developing the regulatory infrastructure that supports financial disclosure’s quality. It actively cultivates a business environment characterized by trust and credibility. Ultimately, this modernization effort is intended to significantly strengthen Egypt’s strategic position as a premier regional hub for attracting investments, particularly within non-banking financial sectors.