What is auditing?

An audit is an examination and verification of a company’s financial and accounting records and supporting documents by a professional, such as a Certified Public Accountant.

Who needs auditing and in Morocco?          

The Companies Law of 1999 has redefined the status of the auditor. Furthermore, the National Council of the Institute of the Chartered Accountants developed a manual of profession standards primarily based on the IFAC standards. This information comes from an Ernst & Young publication: Doing Business in Morocco.

Audit is required for all public limited companies, listed companies, banks and insurances and for all other companies with an annual turnover over than MAD 50 million.

For some companies (listed, public, banking, credit institute, insurance…) audit must be lead by two statutory auditors who are required to comply with the Ethical Standards established by the chartered accountant Institute. This information was published in a publication of RSM International in 2011. More can be read here.

What are the audit processes in this country?

The auditor’s report must state whether the financial statements have been properly prepared in accordance with the provisions of the Companies’ Law and whether they give a true and fair view. More can be read here.

The general approach to auditing in Morocco is largely consistent with the IFAC International Standards on Auditing (ISA). The standards have been considerably improving over the years. However, according to the Report on the Observance of Standards and Codes (ROSC) by the World Bank, the Moroccan auditing standards have not all been updated, such as:

• ISA 240: Auditor’s responsibility to consider fraud and error in an audit of financial statements.

The Moroccan auditing standards have neglected to incorporate specific ISAs, such as:

• ISA 550: Related Parties

The Moroccan auditing standards are also less explicit and detailed than the ISAs, such as:

• ISA 401: Auditing in a computer information systems environment,

The latter is only partly incorporated into the Moroccan standards, despite the importance of the computer environment in Morocco.

Useful Links

• IG/MCC List of approved audit firms in Morocco
• UHY on doing business in Morocco
• Ernst & Young in Morocco – overview
• WIKIHOW to the 6 basic steps to take when one wants to perform basic accounting audits
• PricewaterhouseCoopers – information on Company auditingP
• Guide to conduct financial audit
• Information and advice on how to prepare for an audit