MINISTERY OF HIGHER EDUCATION AND SCIENTIFIC RESEARCH

GRADUATE SCHOOL OF FINANCE AND ACCOUNTING

The second cycle department

Third year

Unit 1: public accounting

What is public accounting?

Public accounting refers to firms of accountants that serve clients or businesses (retailers,
manufacturers, individuals, and governmental organizations. They can be solely owned or managed
by a unique or sole accountant or belong to huge international firms employing thousands of CPAs:
Certified Public Accountants.

What type of services do they offer ?

Preparation, review, and auditing of the clients' financial statements

Tax work including the preparation of income tax returns, estate and tax planning, etc.

Consulting and advice involving accounting systems, mergers and acquisitions.

Accounting and accounting rules in Algeria

Accounting Rules

Tax Year: The tax year begins on 1 January and finishes on 31 December of the same year.

Financial Reporting Framework in Algeria: Algeria does not have a stock exchange.

All business enterprises, public enterprises, quasi-public enterprises, cooperatives, and other ongoing
commercial entities are required to prepare financial statements in accordance with Algerian
accounting standards, with the exception of very small enterprises for which a simplified set of
standards has been developed.

Accounting structure includes: the balance sheet, the income statement, the cash-flow statement,
the statement of change in shareholders' equity and an appendix.

Publication Requirements Monthly and Annual declarations are compulsory:

- A monthly declaration of tax paid in cash or deducted at source. Before the 21st of every month,
each company must make a monthly declaration, series GN50, if they belong to the Real Regime.

- An annual declaration of company profits (IBS: tax on company profits). Before 1 April of every year,
each company must make an annual declaration of its profits, series E N6, to the tax office it comes
under.

Large companies have to pay provisional tax three times a year: 20 March, 20 June, 20 November.

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 MINISTERY OF HIGHER EDUCATION AND SCIENTIFIC RESEARCH
GRADUATE SCHOOL OF FINANCE AND ACCOUNTING

Companies are no longer required to close their books by 31 December if that is not compatible with
their activities according to the new accounting framework. This provision still has to be accepted by
the tax authority.

Professional Accountancy Bodies: ONCA , National Organization of Chartered Accountants

Certification and Auditing: Most companies are required to appoint auditors and audit their
accounts, according to the 2011 Finance Law. However, companies with a turnover below DZD
10,000,000 are not required to have their accounts certified by an auditor.

Algerian accounting standards (the Plan Comptable National, or PCN) are established by the Conseil
National de la Comptabilite within the Ministry of Finance. In July 2006 the Ministry of Finance
adopted a programme to revise the PCN based substantially on IFRSs, effective 1 January 2010.
Companies currently prepare accounts using a statutory format published in 1975.

Accounting Standards: The Act 07-11 of 25 November 2007 (only in French) on the financial
accounting system has ended the rule of the national accounting plan dating from 1975. This law,
which is in force as of 2010, aimed to harmonize the Algerian accounting plan with the international
standards (IFRS) of the IASB.

New accounting standards largely based on these IFRS have been officially adopted (IFRS Standards
with several exceptions)Accounting Regulation Bodies Accounting Reports :All business enterprises,
public enterprises, quasi-public enterprises, cooperatives, and other ongoing commercial entities are
required to prepare financial statements in accordance with Algerian accounting standards, with the
exception of very small enterprises for which a simplified set of standards has been developed.

Since January 1, 2010, companies in Algeria have been forced to use the new SCF (accounting and
financial system), inspired in its majority of international accounting standards IAS/IFRS, issued by
the international Accounting Standards Board (IASB). This mutation, which is expected as it is due
more than ten years of reflection, should enable users of financial statements to better understand
the financial situation of Algerian companies. With the development of the increasingly important
information requirements of financial markets, it has become necessary to standardize international
accounting standards so that companies can provide financial information the same level of financial
information using the same methods of calculation. A new principle of component accounting is
required for all corporations. It is to register separately for fixed asset items that are used differently
by the company and then to establish its own depreciation schedule for each. The damping
components is to absorb separately, each using a method and an appropriate depreciation rate,
important components that is to say of an asset component that have different useful lives or that
are consumed at different rates. It is an accounting method of depreciation by components.

New Law on Public Accounting and Financial Management: 4 draft executive decrees examined by
the government

The government discussed at its weekly meeting, chaired on Saturday by Prime Minister Aïmene
Benabderrahmane, four draft executive decrees of the new law on public accounting and financial
management, according to a statement from the Prime Minister's Office.

According to the same source, “the Minister of Finance has submitted four draft executive decrees
that are implemented under the provisions of Law No. 23-07 of June 21, 2023, on the rules of public
accounting and financial management.”

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 MINISTERY OF HIGHER EDUCATION AND SCIENTIFIC RESEARCH
GRADUATE SCHOOL OF FINANCE AND ACCOUNTING

These are the draft executive decree laying down the content and the procedures for implementing
public accounting, the executive decree laying down the procedure for the payment by credit of
public expenditure, the one laying down the conditions and procedures for replacement, delegation
of signature and appointment of temporary agents, and finally the draft executive decree laying
down the types of Treasury correspondents and procedures for the operation of the accounts for the
deposit of funds, the press release states.

The enactment of these texts will allow “the implementation of the provisions of Law n 23-07 of 21
June 2023 aimed in particular at establishing the new accounting structure provided for by the
organic law on the laws of finance,” it points out in the same text.