This report provides an updated assessment of accounting, financial reporting, and auditing requirements and practices within the enterprise and financial sectors in Croatia. It uses International Financial Reporting Standards (IFRS), International Standards on Auditing (ISA), and the relevant portions of European Union (EU) law (also known as the acquis communautaire). Croatia has made considerable progress in developing its regulatory framework for corporate sector financial reporting and auditing since the publication of the first Accounting and Auditing (A&A) report on the observance of standards and codes (ROSC) in 2002. The alignment of the revised regulatory framework with the acquis communautaire has been significantly improved and lays the basis for reinforcing the institutional capacity for financial reporting and auditing. However, not all requirements of the relevant acquis have been introduced and further work is needed to achieve full compliance. The Croatian institutional framework has undergone several important changes. However, further capacity building relating to monitoring, enforcing, and strengthening supervision (except for banks) is needed to ensure proper application of IFRS and national accounting standards. This report concludes that Croatia should take further steps in order to achieve its goal of developing a robust financial reporting framework tailored to the needs of the Croatian market economy, and aligned with the acquis communautaire, international standards and best practices.