Accounting Reform in Lithuania

The reform of accounting started in 1992 when the Supreme Council of the Republic of Lithuania passed the Law on the Principles of Accounting. In the period between 1990, as the year of the declaration Lithuanian's independence, and 1992, accounting used to be performed pursuant to instructions in operation under the administrative command system. However, certain slight changes resulting mainly from economic reforms and privatization initiated at that time were undertaken in the area of accountancy.

The Law on the Principles of Accounting obligated enterprises to organize their accounting procedures so that tax-counting offices, statisticians, creditors, and commercial partners could receive faithful and timely information. For the first time in the history of Lithuanian accountancy the Law demanded that accounting should be carried out in conformity with the provisions of International Accounting Standards and the European Union (formerly European Economic Community) Directives.