Accounting Reforms and Access to Finance for Small and Medium Enterprises (SMEs) in Developing Economies (The Case of Georgia)

Eka  Gegeshidze  Natia  Kalatozishvili

Journal number 3 ∘ Eka Gegeshidze ∘ Natia Kalatozishvili ∘
Accounting Reforms and Access to Finance for Small and Medium Enterprises (SMEs) in Developing Economies (The Case of Georgia)

doi.org/10.52340/eab.2025.17.03.14

In the context of global financial reporting harmonization, Georgia offers a compelling case for examining the impact of accounting reforms on SME access to finance. As a small, rapidly developing country with aspirations for European integration, Georgia – with a population of 3.7 million and a GDP per capita of USD 9,141 (Geostat.ge) –has made notable strides in aligning its financial reporting and auditing practices with international standards, particularly under the framework of the 2014 Association Agreement with the European Union. In a financial landscape where private sector funding is largely dependent on commercial banks and capital markets remain underdeveloped, the availability of timely and reliable financial information is critical for informed lending decisions – especially for small and medium-sized enterprises (SMEs). Acknowledging this need, Georgia enacted the Law on Accounting, Reporting, and Auditing in 2016, initiating a comprehensive reform to enhance financial transparency, strengthen regulatory oversight, and promote economic growth. This reform was especially significant for improving SME access to finance, as it aimed to provide creditors with standardized and trustworthy financial data to support more accurate credit assessments.
A key feature of the reform was the mandatory disclosure of financial statements through a national online portal (www.reportal.ge), introduced in 2019. Companies were classified into four categories based on size and activity type, determining their respective accounting and auditing obligations. Public Interest Entities and large companies (Category I) were required to prepare audited financialstatements in accordance with full IFRS starting in October 2018. Large and medium-sized companies (Categories II and III) adopted IFRS for SMEs from 2019, with auditing mandatory for Category II and voluntary for Category III. The smallest businesses (Category IV) were granted until 2021 to implement simplified IFRS reporting, also with voluntary audit requirements (Pirveli & Shugliashvili, 2019).
Oversight was provided by the Service for Accounting, Reporting and Auditing Supervision (SARAS), whose reports indicated consistently high submission rates among larger companies (95% in 2021, 93% in 2023 for Categories I–III). In contrast, submission rates among micro and small enterprises (Category IV) declined over time (from 80% in 2021 to 72% in 2023), highlighting persistent challenges within this segment. Despite extensive broad public education campaigns and the retraining of over 2,200 accounting and audit professionals between 2019 and 2022, SARAS acknowledged ongoing issues with the quality, reliability, and timeliness of submitted reports. Notably, no systematic public data exists on the actual accuracy of submitted financial statements, leaving a significant gap in assessing evaluating the reform’s overall effectiveness.
To examine the impact of these regulatory changes on SME access to finance, this study employed a mixed-method approach. A baseline survey was conducted in 2019 among 74 Georgian companies, supplemented by expert interviews with three professional accountants and auditors. The survey revealed a notable gap between optimistic expectations of the reform’s benefits (81% expected positive effects) and actual preparedness (only 42% had a good or comprehensive understanding of requirements). Key concerns included insufficient accounting skills, limited comprehension of reform details, and the potential for increased compliance costs among smaller businesses.
Five years into the reform, in 2024, the study conducted semi-structured interviews with senior representatives from three of Georgia’s major commercial banks to assess its influence on lending practices. The findings underscored persistent challenges. All respondents agreed that financial statements published on the state portal remained insufficiently reliable for assessing SME credit risk – particularly for Categories III and IV, whose reports are typically unaudited. Consequently, banks continued to rely primarily on financial data obtained directly from clients, as public disclosured statements were often outdated by the time lending decisions were made.
Bank representatives observed that tax declarations submitted to the Revenue Service were generally more reliable, owing to systematic cross-checks, whereas the reporting portal was regarded by many SMEs as largely procedural. Financial statements for the previous year typically became available only by the third quarter of the following year, making them outdated for real-time credit assessments. Consequently, public disclosures were consulted primarily when discrepancies or concerns emerged in the financial data submitted directly by clients.
The interviews also revealed several structural factors contributing to the low quality and limited utility of SME financial reporting. This included low levels of financial literacy, weak internal financial management practices, and a persistentreluctance on informal, traditional businesshabits. As a result, the banking sector
continued to depend primarily on collateral-based lending, making minimal use of publicly disclosed financial performance indicators in SME credit risk assessments, largely due to the unreliability of financial statements.
Nonetheless, banks noted isolated signs of progress, particularly among younger entrepreneurs adopting automated accounting systems. While this development is promising, remains limited and has yet to acieve systemic scale. Based on these findings, the study offers several practical recommendations:
• Strengthen quality control and oversight mechanisms for public financial reporting, including the upgrade of automated error detection systems.
• Develop financial literacy and analytical culture among SMEs through systematic programs and access to accounting and audit advisory services.
• Promote the adoption of digital accounting platforms among SMEs through targeted support and incentives.
This study makes a significant academic contribution by offering one of the first focused evaluations of the impact of accounting standards harmonization on SME access to finance within the context of a developing economy. It highlights not only the regulatory progress achieved but also the enduring challenges that continue to hinder financial transparency and constrain lending opportunities for SMEs in Georgia. The findings emphasize that improvements in technical compliance do not necessarily lead to substantive changes in financial decision-making and credit assessment practices, particularly when deeper structural issues remain unadressed.
For future research, it is recommended to continue monitoring these trends developments, undertake cross-country comparative analyses, and assess evaluate the performance of similar reforms perform in other emerging economies. Such efforts could help identify best practices for enhancing strengthening financial access and cultivating a robust reporting culture among SMEs in developing markets.

Keywords: Accounting reform, SME financing, financial transparency, Georgia, emerging markets.
JEL Codes: G21, M41, M48, O16, L26

References:
• bughaltruli aghritskhvis, angarishgebisa da auditis zedamkhedvelobis samsakhuris tsliuri angarishebi: [Accounting, Reporting and Audit Supervision Service Annual Reports:
(2019). https://saras.gov.ge/Content/files/SARAS_AR_2019.pdf ,
(2020). https://saras.gov.ge/Content/files/SARAS_Annual_Report_2020.pdf,
(2021). https://saras.gov.ge/Content/files/SARAS_annual_report_2021.pdf ,
(2022). https://saras.gov.ge/Content/files/SARAS%20AR22-2.pdf
(2023).https://saras.gov.ge/Content/files/%e1%83%ac%e1%83%9a%e1%83%98%e1%83%a3%e1%83%a0%e1%83%98%20%E1%83%90%E1%83%9C%E1%83%92%E1%83%90%E1%83%A0%E1%83%98%E1%83%A8%E1%83%98%202023.pdf,
(2024). https://saras.gov.ge/Content/files/AR24.pdf ] (last seen 2025, 2 July)] In Georgian
• bughaltruli aghritskhvis, angarishgebisa da auditis zedamkhedvelobis samsakhuri (2023). strategia 2023–2026 tslebistvis. [Accounting, Reporting and Audit Supervision Service. (2023). Strategy for 2023–2026. https://saras.gov.ge/Content/files/SARAS_Strategy_2023-20262.pdf Strategy.] Last seen July 2, 2025) in Georgian
• Pirveli E. (2019). bughaltruli aghritskhvisa da auditis reporma: pirveli shepaseba [Accounting and Auditing Reform: A First Assessment Forbes Georgia, 9(2), 82–85.] https://ssrn.com/abstract=3369617 in Georgian
• Kalatozishvili N. (2019). gazrdili gamchvirvaloba da finansur informatsiaze khelmistsatmoboba sakartveloshi. [Increased Transparency and Financial Information Availability in Georgia. Collection of Scientific Works from the First International Scientific-Practical Conference in the Field of Accounting and Finance, 192. Tbilisi: Caucasus University. https://dspace.nplg.gov.ge/handle/1234/445791] in Georgian
• sakartvelos parlamenti. (2016). kanoni bughaltruli aghritskhvisa, angarishgebisa da auditis shesakheb [Law on Accounting, Reporting and Auditing. https://www.saras.gov.ge/Content/files/SARAS_LAW_29_05_2024.pdf] (Last seen 2025, 2 July) in Georgian
• sakartvelos statistikis erovnuli samsakhuri (sakstati). (2025). sakartvelos mosakhleoba da mshp. ert sulze [National Statistics Office of Georgia. (2025). Population of Georgia and GDP per Capita. https://www.geostat.ge/ka] (Last seen 2025, 2 July) in Georgian
• Beck T. (2007). Financing Constraints of SMEs in Developing Countries: Evidence, Determinants and Solutions. Financing Innovation-Oriented Businesses to Promote Entrepreneurship, 13–36. https://repository.tilburguniversity.edu/server/api/core/bitstreams/a21cf137-ace8-4b3f-bb83-2c24adf3bec9/content
• Chingvaro L. (2023). Exploring Regional Variations in the Adoption of IFRS for SMEs: A Structrured Review. International Journal of Research Publications. 138(1), 277-306. https://doi.org/10.47119/IJRP10013811220235738
• Hellman N., Nilsson H., Tylaite M., & Vural D. (2022). The Impact of an IFRS For SMEs-Based Standard on Financial Reporting Properties and Cost of Debt Financing: Evidence from Swedish Private Firms. European Accounting Review. Taylor & Francis Journals. 31(5), 1175-1205. https://doi.org/10.1080/09638180.2022.2085758
• Hyblová E. (2019). The Current Problems of Harmonization of Accounting for Small and Medium-Sized Enterprises. Economic Research-Ekonomska Istraživanja, 32(1), 36–52. https://doi.org/10.1080/1331677X.2018.1561317
• Jorissen A., Ram R., & Barros P. (2022). Are IFRS Standards a ‘Trusted’ Language for Private Firm Credit Decisions? An Analysis of Country Differences in Users’ Perspective. Accounting and Finance, Journal of Accounting, 62(2), 3021-3065. http://dx.doi.org/10.1111/acfi.12949
• Kharabadze E., & Mamukelashvili I. (2016). The Development of Financial Reporting and Auditing Standards throughout the World: Importance of Institutions. Journal of Business & Management (COES&RJ-JBM), 4, 130–139. https://ideas.repec.org/a/jso/coejbm/v4y2016i3p130-139.html
• Nanyondo M., Tauringana V., Kamukama N., & Nkundabanyanga S. (2014). Quality of Financial Statements, Information Asymmetry, Perceived Risk and Access to Finance by Ugandan SMEs. International Journal of Management Practice, 7(4), 324–340. http://dx.doi.org/10.1504/IJMP.2014.065230
• Erekle P., & Zimmermann J. (2025). Twenty Years of IFRS ‘Success’? A Systematic Review of Scopus Literature. Journal of International Accounting, Auditing and Taxation. (Forthcoming). http://dx.doi.org/10.2139/ssrn.4699908
• Pirveli E. (2022). Corporate Disclosure Timing Under IFRS: The Case of Emerging Georgia. Journal of Financial Reporting and Accounting, 22(5), 1253-1283. https://doi.org/10.1108/JFRA-12-2021-0443
• Pirveli E., & Shugliashvili T. (2019). Accounting and Audit Reform in Georgia: Theoretical and Descriptive Analysis. Economics and Business, 10(2), 163–184. https://dspace.tsu.ge/server/api/core/bitstreams/9d87c39c-9e9b-4eff-8621-0482df86d91f/content
• Sabauri L. (2018). Approval and Introduction of the International Financial Reporting Standards (IFRS) in Georgia: Challenges and Perspectives. Journal of Accounting & Marketing, 7(2). https://doi.org/10.4172/2168-9601.1000268
• Sabauri, L., & Kvatashidze, N. (2018). Prospects of Application of International Standards in Financial Reporting by Small and Medium-Size Businesses in Georgia. International Journal of Business Administration, 9(2), 1–8. https://doi.org/10.5430/ijba.v9n2p1
• Potharla S. (2025). Global Adoption of International Financial Reporting Standards (IFRS): A Comprehensive Review and Critical Analysis (2000–2025). SSRN. http://dx.doi.org/10.2139/ssrn.5277789
• IFRS Foundation. (2025). Analysis of the IFRS Profiles for the IFRS for SMEs Accounting Standard. https://www.ifrs.org/use-around-the-world/use-of-ifrs-standards-by-jurisdiction/#analysis-of-the-use-of-the-ifrs-for-smes-accounting-standard (Last seen 2025, 2 July)
• IFRS Foundation. (2025). Use of IFRS Accounting Standards by Jurisdiction. https://www.ifrs.org/use-around-the-world/use-of-ifrs-standards-by-jurisdiction/#analysis-of-the-169-profiles (Last seen 2025, 2 July)
• Official Journal of the European Union. (2014). Association Agreement between the European Union and Georgia. https://www.eeas.europa.eu/sites/default/files/association_agreement.pdf (Last seen 2025, 2 July)
• World Bank Group. (2015). Report on the Observance of Standards and Codes on Accounting and Auditing. https://documents.worldbank.org/en/publication/documents-reports/documentdetail/254551468189259272/acs13210-revised-georgia-rosc-aa-report-final-092015-box393232b-public-english-dissemination (Last seen 2025, 2 July)
• World Bank Group. (2019). Audit Oversight to Enhance Trust and Transparency in Corporate Financial Statements: Challenges in Developing Countries. https://cfrr.worldbank.org/publications/audit-oversight-enhance-trust-and-transparency (Last seen 2025, 2 July).

Economics and Business Referential and Reviewed International Scientific-Analytical Journal of Ivane Javakhishvili Tbilisi State University, Faculty of Economics and Business

ISSN 1987-5789 ESSN 2587-5426 doi 10.52340	Journal number 3 ∘ Eka Gegeshidze ∘ Natia Kalatozishvili ∘ Accounting Reforms and Access to Finance for Small and Medium Enterprises (SMEs) in Developing Economies (The Case of Georgia) doi.org/10.52340/eab.2025.17.03.14 In the context of global financial reporting harmonization, Georgia offers a compelling case for examining the impact of accounting reforms on SME access to finance. As a small, rapidly developing country with aspirations for European integration, Georgia – with a population of 3.7 million and a GDP per capita of USD 9,141 (Geostat.ge) –has made notable strides in aligning its financial reporting and auditing practices with international standards, particularly under the framework of the 2014 Association Agreement with the European Union. In a financial landscape where private sector funding is largely dependent on commercial banks and capital markets remain underdeveloped, the availability of timely and reliable financial information is critical for informed lending decisions – especially for small and medium-sized enterprises (SMEs). Acknowledging this need, Georgia enacted the Law on Accounting, Reporting, and Auditing in 2016, initiating a comprehensive reform to enhance financial transparency, strengthen regulatory oversight, and promote economic growth. This reform was especially significant for improving SME access to finance, as it aimed to provide creditors with standardized and trustworthy financial data to support more accurate credit assessments. A key feature of the reform was the mandatory disclosure of financial statements through a national online portal (www.reportal.ge), introduced in 2019. Companies were classified into four categories based on size and activity type, determining their respective accounting and auditing obligations. Public Interest Entities and large companies (Category I) were required to prepare audited financialstatements in accordance with full IFRS starting in October 2018. Large and medium-sized companies (Categories II and III) adopted IFRS for SMEs from 2019, with auditing mandatory for Category II and voluntary for Category III. The smallest businesses (Category IV) were granted until 2021 to implement simplified IFRS reporting, also with voluntary audit requirements (Pirveli & Shugliashvili, 2019). Oversight was provided by the Service for Accounting, Reporting and Auditing Supervision (SARAS), whose reports indicated consistently high submission rates among larger companies (95% in 2021, 93% in 2023 for Categories I–III). In contrast, submission rates among micro and small enterprises (Category IV) declined over time (from 80% in 2021 to 72% in 2023), highlighting persistent challenges within this segment. Despite extensive broad public education campaigns and the retraining of over 2,200 accounting and audit professionals between 2019 and 2022, SARAS acknowledged ongoing issues with the quality, reliability, and timeliness of submitted reports. Notably, no systematic public data exists on the actual accuracy of submitted financial statements, leaving a significant gap in assessing evaluating the reform’s overall effectiveness. To examine the impact of these regulatory changes on SME access to finance, this study employed a mixed-method approach. A baseline survey was conducted in 2019 among 74 Georgian companies, supplemented by expert interviews with three professional accountants and auditors. The survey revealed a notable gap between optimistic expectations of the reform’s benefits (81% expected positive effects) and actual preparedness (only 42% had a good or comprehensive understanding of requirements). Key concerns included insufficient accounting skills, limited comprehension of reform details, and the potential for increased compliance costs among smaller businesses. Five years into the reform, in 2024, the study conducted semi-structured interviews with senior representatives from three of Georgia’s major commercial banks to assess its influence on lending practices. The findings underscored persistent challenges. All respondents agreed that financial statements published on the state portal remained insufficiently reliable for assessing SME credit risk – particularly for Categories III and IV, whose reports are typically unaudited. Consequently, banks continued to rely primarily on financial data obtained directly from clients, as public disclosured statements were often outdated by the time lending decisions were made. Bank representatives observed that tax declarations submitted to the Revenue Service were generally more reliable, owing to systematic cross-checks, whereas the reporting portal was regarded by many SMEs as largely procedural. Financial statements for the previous year typically became available only by the third quarter of the following year, making them outdated for real-time credit assessments. Consequently, public disclosures were consulted primarily when discrepancies or concerns emerged in the financial data submitted directly by clients. The interviews also revealed several structural factors contributing to the low quality and limited utility of SME financial reporting. This included low levels of financial literacy, weak internal financial management practices, and a persistentreluctance on informal, traditional businesshabits. As a result, the banking sector continued to depend primarily on collateral-based lending, making minimal use of publicly disclosed financial performance indicators in SME credit risk assessments, largely due to the unreliability of financial statements. Nonetheless, banks noted isolated signs of progress, particularly among younger entrepreneurs adopting automated accounting systems. While this development is promising, remains limited and has yet to acieve systemic scale. Based on these findings, the study offers several practical recommendations: • Strengthen quality control and oversight mechanisms for public financial reporting, including the upgrade of automated error detection systems. • Develop financial literacy and analytical culture among SMEs through systematic programs and access to accounting and audit advisory services. • Promote the adoption of digital accounting platforms among SMEs through targeted support and incentives. This study makes a significant academic contribution by offering one of the first focused evaluations of the impact of accounting standards harmonization on SME access to finance within the context of a developing economy. It highlights not only the regulatory progress achieved but also the enduring challenges that continue to hinder financial transparency and constrain lending opportunities for SMEs in Georgia. The findings emphasize that improvements in technical compliance do not necessarily lead to substantive changes in financial decision-making and credit assessment practices, particularly when deeper structural issues remain unadressed. For future research, it is recommended to continue monitoring these trends developments, undertake cross-country comparative analyses, and assess evaluate the performance of similar reforms perform in other emerging economies. Such efforts could help identify best practices for enhancing strengthening financial access and cultivating a robust reporting culture among SMEs in developing markets. Keywords: Accounting reform, SME financing, financial transparency, Georgia, emerging markets. JEL Codes: G21, M41, M48, O16, L26 References: • bughaltruli aghritskhvis, angarishgebisa da auditis zedamkhedvelobis samsakhuris tsliuri angarishebi: [Accounting, Reporting and Audit Supervision Service Annual Reports: (2019). https://saras.gov.ge/Content/files/SARAS_AR_2019.pdf , (2020). https://saras.gov.ge/Content/files/SARAS_Annual_Report_2020.pdf, (2021). https://saras.gov.ge/Content/files/SARAS_annual_report_2021.pdf , (2022). https://saras.gov.ge/Content/files/SARAS%20AR22-2.pdf (2023).https://saras.gov.ge/Content/files/%e1%83%ac%e1%83%9a%e1%83%98%e1%83%a3%e1%83%a0%e1%83%98%20%E1%83%90%E1%83%9C%E1%83%92%E1%83%90%E1%83%A0%E1%83%98%E1%83%A8%E1%83%98%202023.pdf, (2024). https://saras.gov.ge/Content/files/AR24.pdf ] (last seen 2025, 2 July)] In Georgian • bughaltruli aghritskhvis, angarishgebisa da auditis zedamkhedvelobis samsakhuri (2023). strategia 2023–2026 tslebistvis. [Accounting, Reporting and Audit Supervision Service. (2023). Strategy for 2023–2026. https://saras.gov.ge/Content/files/SARAS_Strategy_2023-20262.pdf Strategy.] Last seen July 2, 2025) in Georgian • Pirveli E. (2019). bughaltruli aghritskhvisa da auditis reporma: pirveli shepaseba [Accounting and Auditing Reform: A First Assessment Forbes Georgia, 9(2), 82–85.] https://ssrn.com/abstract=3369617 in Georgian • Kalatozishvili N. (2019). gazrdili gamchvirvaloba da finansur informatsiaze khelmistsatmoboba sakartveloshi. [Increased Transparency and Financial Information Availability in Georgia. Collection of Scientific Works from the First International Scientific-Practical Conference in the Field of Accounting and Finance, 192. Tbilisi: Caucasus University. https://dspace.nplg.gov.ge/handle/1234/445791] in Georgian • sakartvelos parlamenti. (2016). kanoni bughaltruli aghritskhvisa, angarishgebisa da auditis shesakheb [Law on Accounting, Reporting and Auditing. https://www.saras.gov.ge/Content/files/SARAS_LAW_29_05_2024.pdf] (Last seen 2025, 2 July) in Georgian • sakartvelos statistikis erovnuli samsakhuri (sakstati). (2025). sakartvelos mosakhleoba da mshp. ert sulze [National Statistics Office of Georgia. (2025). Population of Georgia and GDP per Capita. https://www.geostat.ge/ka] (Last seen 2025, 2 July) in Georgian • Beck T. (2007). Financing Constraints of SMEs in Developing Countries: Evidence, Determinants and Solutions. Financing Innovation-Oriented Businesses to Promote Entrepreneurship, 13–36. https://repository.tilburguniversity.edu/server/api/core/bitstreams/a21cf137-ace8-4b3f-bb83-2c24adf3bec9/content • Chingvaro L. (2023). Exploring Regional Variations in the Adoption of IFRS for SMEs: A Structrured Review. International Journal of Research Publications. 138(1), 277-306. https://doi.org/10.47119/IJRP10013811220235738 • Hellman N., Nilsson H., Tylaite M., & Vural D. (2022). The Impact of an IFRS For SMEs-Based Standard on Financial Reporting Properties and Cost of Debt Financing: Evidence from Swedish Private Firms. European Accounting Review. Taylor & Francis Journals. 31(5), 1175-1205. https://doi.org/10.1080/09638180.2022.2085758 • Hyblová E. (2019). The Current Problems of Harmonization of Accounting for Small and Medium-Sized Enterprises. Economic Research-Ekonomska Istraživanja, 32(1), 36–52. https://doi.org/10.1080/1331677X.2018.1561317 • Jorissen A., Ram R., & Barros P. (2022). Are IFRS Standards a ‘Trusted’ Language for Private Firm Credit Decisions? An Analysis of Country Differences in Users’ Perspective. Accounting and Finance, Journal of Accounting, 62(2), 3021-3065. http://dx.doi.org/10.1111/acfi.12949 • Kharabadze E., & Mamukelashvili I. (2016). The Development of Financial Reporting and Auditing Standards throughout the World: Importance of Institutions. Journal of Business & Management (COES&RJ-JBM), 4, 130–139. https://ideas.repec.org/a/jso/coejbm/v4y2016i3p130-139.html • Nanyondo M., Tauringana V., Kamukama N., & Nkundabanyanga S. (2014). Quality of Financial Statements, Information Asymmetry, Perceived Risk and Access to Finance by Ugandan SMEs. International Journal of Management Practice, 7(4), 324–340. http://dx.doi.org/10.1504/IJMP.2014.065230 • Erekle P., & Zimmermann J. (2025). Twenty Years of IFRS ‘Success’? A Systematic Review of Scopus Literature. Journal of International Accounting, Auditing and Taxation. (Forthcoming). http://dx.doi.org/10.2139/ssrn.4699908 • Pirveli E. (2022). Corporate Disclosure Timing Under IFRS: The Case of Emerging Georgia. Journal of Financial Reporting and Accounting, 22(5), 1253-1283. https://doi.org/10.1108/JFRA-12-2021-0443 • Pirveli E., & Shugliashvili T. (2019). Accounting and Audit Reform in Georgia: Theoretical and Descriptive Analysis. Economics and Business, 10(2), 163–184. https://dspace.tsu.ge/server/api/core/bitstreams/9d87c39c-9e9b-4eff-8621-0482df86d91f/content • Sabauri L. (2018). Approval and Introduction of the International Financial Reporting Standards (IFRS) in Georgia: Challenges and Perspectives. Journal of Accounting & Marketing, 7(2). https://doi.org/10.4172/2168-9601.1000268 • Sabauri, L., & Kvatashidze, N. (2018). Prospects of Application of International Standards in Financial Reporting by Small and Medium-Size Businesses in Georgia. International Journal of Business Administration, 9(2), 1–8. https://doi.org/10.5430/ijba.v9n2p1 • Potharla S. (2025). Global Adoption of International Financial Reporting Standards (IFRS): A Comprehensive Review and Critical Analysis (2000–2025). SSRN. http://dx.doi.org/10.2139/ssrn.5277789 • IFRS Foundation. (2025). Analysis of the IFRS Profiles for the IFRS for SMEs Accounting Standard. https://www.ifrs.org/use-around-the-world/use-of-ifrs-standards-by-jurisdiction/#analysis-of-the-use-of-the-ifrs-for-smes-accounting-standard (Last seen 2025, 2 July) • IFRS Foundation. (2025). Use of IFRS Accounting Standards by Jurisdiction. https://www.ifrs.org/use-around-the-world/use-of-ifrs-standards-by-jurisdiction/#analysis-of-the-169-profiles (Last seen 2025, 2 July) • Official Journal of the European Union. (2014). Association Agreement between the European Union and Georgia. https://www.eeas.europa.eu/sites/default/files/association_agreement.pdf (Last seen 2025, 2 July) • World Bank Group. (2015). Report on the Observance of Standards and Codes on Accounting and Auditing. https://documents.worldbank.org/en/publication/documents-reports/documentdetail/254551468189259272/acs13210-revised-georgia-rosc-aa-report-final-092015-box393232b-public-english-dissemination (Last seen 2025, 2 July) • World Bank Group. (2019). Audit Oversight to Enhance Trust and Transparency in Corporate Financial Statements: Challenges in Developing Countries. https://cfrr.worldbank.org/publications/audit-oversight-enhance-trust-and-transparency (Last seen 2025, 2 July).