Background

The Egyptian Financial Regulatory Authority (FRA) was established in 2009 as the primary regulator and supervisor of non-bank financial markets and instruments in Egypt. The FRA’s mandate encompasses ensuring market stability, protecting investors, enhancing transparency, and promoting confidence in the country’s non-bank financial sector.

In addition to its regulatory responsibilities, the FRA plays a central role in developing and maintaining accounting and auditing standards in Egypt. The FRA Chairman serves as the head of the Standard-Setting Committee, which is tasked with reviewing existing standards, issuing clarifications, and providing technical guidance on matters related to Egyptian Accounting Standards. The Committee also submits recommendations to the Minister of Investment regarding the adoption of relevant accounting and auditing standards. Through these mechanisms, the FRA ensures that the financial reporting framework in Egypt remains robust, consistent, and aligned with the evolving needs of the market.

Accounting Standards

Egypt has not fully adopted the International Financial Reporting Standards (IFRS) as issued by the International Accounting Standards Board (IASB). Instead, the country applies its own Egyptian Accounting Standards (EAS), which were initially issued in July 2015 and subsequently amended in 2019 and 2023 to reflect emerging financial reporting practices and market needs. While the EAS are broadly aligned with IFRS, they are not identical and do not cover all areas comprehensively.

Recognizing the limitations of the EAS in addressing certain complex transactions and economic events, Egyptian regulations allow entities to refer to IFRS for guidance when local standards do not provide sufficient instructions. This hybrid approach ensures that financial statements prepared in Egypt maintain relevance, reliability, and comparability, while also enabling alignment with international practices where necessary.

The FRA's oversight and the adoption of Egyptian Accounting Standards are critical to maintaining investor confidence, ensuring financial transparency, and supporting the development of non-bank financial markets. By establishing clear reporting requirements and guidance, the FRA helps safeguard the integrity of financial statements, facilitates informed decision-making by stakeholders, and promotes the sustainable growth of Egypt’s financial sector.