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The study examines the relationship between financial and tax accounting rules, explicitly focusing on book-tax differences in Kosovo as a transitional economy. Despite a longstanding tradition of development in accounting and taxation, substantial institutional and public discourse regarding the differences in financial and tax regulations have been absent. Surprisingly, even constitutional tax principles did not catalyze debates regarding this alignment. Historically, the discussions and treatments on this subject have predominantly been confined to academic circles and tax authorities. Kosovo’s official bodies have not publicly expressed their viewpoint on the relationship between financial accounting and tax accounting rules. This lack of communication also applies to discussions about the Common Consolidated Corporate Tax Base (CCCTB) proposal, the newly developed Business in Europe: Framework for Income Taxation (BEFIT), and the IF/OECD/EU Pillar 2 (and Pillar 1) proposals. The study emphasizes the need for a broader discussion on book-tax differences and systematic alignment to promote Kosovo’s economic development and integration into the European Union financial system. [ABSTRACT FROM AUTHOR]

If we want to go back to history of accounting, we have to consider the socio-economic arrangements that Kosovo has undergone. Without pretending to make subjective conclusions on any socioeconomic system in this paper we have tried to consider the characteristics of accounting through different time periods in Kosovo. By separating the time periods, we pretend to evaluate and analyze the role of accounting. The first period includes the role of accounting up until 1990, the second period includes the role of accounting from 1990 until 1999, and the third period includes the role of accounting from 1999 until 2016. The research paper concludes that the trend of fair presentation of financial statements in a transparent and legal manner is growing even though there is a negative climate in relation to this trend. The main problem is lack of education in the financial sector in terms of reporting income and assets owing to a social economic system that did not promote awareness on good governance in the past. In that regard, the publically owned entities (POEs) demonstrate lack of financial transparency and accountability of not reporting their financial position and performance. Concerning the state of accounting we found a detrimental situation in the sense that the financial reporting was not done in regular basis. This was more emphasized in the transitory time period after the war from 1999 until 2009. The same issues with lack of transparency in POEs were prevalent also in the business or corporate community. POEs, however, were more sensitive for having endured the privatization process. [ABSTRACT FROM AUTHOR]

The aim of this research is to analyze and find out the major issue of fiscal evasion in Kosovo. In this analysis we have used the research method of case study. The results of research show that the phenomenon of fiscal evasion and informality in Kosovo can hardly be measured because in essence these phenomena belong to the hidden economy. Fiscal evasion occurs as a result of disorders in the overall economy and is present in many countries, including industrialized countries as well as those with economy under development, and therefore the state of Kosovo is exposed to this phenomenon. This phenomenon is even more developed in countries lacking legal infrastructure, with particular emphasis the readiness of responsible persons for combating this phenomenon in the context of available opportunities. Kosovo has a high level of informality and this is due to insufficient inspection of enterprises and failure to implement applicable laws. [ABSTRACT FROM AUTHOR]