A serious conflict has emerged between the Addis Ababa Revenue Bureau and the country’s accounting and auditing professionals following allegations that hundreds of accountants and auditors were involved in underreporting and concealing over 10.6 billion birr in revenue, according to experts and professional associations.
On April 1, the Revenue Bureau announced the results of a preliminary audit covering 36,729 tax records from the 2016 EC fiscal year. The audit reportedly uncovered attempts by some taxpayers to underestimate income and submit inaccurate financial reports, potentially causing significant revenue loss to the government. The Bureau claimed it averted damage to public interests by identifying concealed revenue totaling 10.65 billion birr.
Following these findings, the Bureau referred a list of 823 accountants and auditors to the Accounting and Auditing Board of Ethiopia (AABE) for disciplinary action. The measures range from written warnings to license revocations under the authority of Tax Administration Proclamation No. 983/2008. Among those flagged, 334 professionals allegedly submitted accounting records with discrepancies exceeding 75 percent in reported income. The Bureau also indicated that individuals practicing without professional licenses would face similar scrutiny.
The announcement has sparked strong backlash from the accounting community. In a joint statement, the Ethiopian Professional Association of Accountants and Auditors, the Association of External Auditors, and the Accounting Society of Ethiopia condemned the Bureau’s public disclosure of the allegations, arguing it undermines the profession’s credibility and damages public trust in financial reporting.
While the associations expressed willingness to cooperate with the Bureau’s request for investigation, they criticized the wide media dissemination of the information as premature and detrimental. They called on the Revenue Bureau to retract the public statements and remove related content from all media platforms.
The professional bodies also urged the AABE to conduct a thorough investigation into the allegations and publicly share its findings. They warned that the negative publicity could discourage clients from engaging accounting professionals and demoralize practitioners, potentially leading to attrition in a sector already facing a shortage of qualified experts.
“The accounting and auditing profession is critical for ensuring transparency and accountability in Ethiopia’s economy,” the associations said. “This situation risks eroding investor confidence at a time when the country is implementing major economic reforms, including the launch of capital markets.”
The groups further criticized the Bureau for failing to engage in adequate dialogue with professionals before making the accusations public. They stressed that unilateral investigations and announcements without due process violate principles of fairness and professional respect.
The Accounting and Auditing Board of Ethiopia also expressed concern over the premature release of information before completing its inquiry, emphasizing the need for due process and giving professionals the opportunity to respond.
In an effort to resolve the dispute, the associations have called for urgent dialogue between the Revenue Bureau and representatives of accounting and auditing professionals. They warned that continued confrontational actions could seriously harm the profession and negatively impact Ethiopia’s broader economic development.
The Addis Ababa Revenue Bureau recently established a Quality Assurance Unit to re-examine tax audit decisions and improve accountability, signaling a broader push for tax compliance and transparency. However, experts say balancing enforcement with professional collaboration will be key to sustaining trust and effectiveness in Ethiopia’s tax and financial reporting systems.
