US sanctions ban provision of accounting, consulting services to Russia
Expanded U.S. government sanctions against Russia in response to the war in Ukraine include a ban on accounting and management consulting services by U.S. citizens.
The sanctions announced Sunday “prohibit U.S. persons from providing accounting, trust and corporate formation, and management consulting services to any person in the Russian Federation,” a White House statement said.
The statement included other sanctions designed to restrict Russia, which invaded Ukraine on Feb. 24.
The sanctions, effective June 7, are imposed by the U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC), which in a Sunday news release identified accounting and other services as categories “subject to a prohibition on the export, reexport, sale, or supply, directly or indirectly, from the United States, or by a U.S. person, wherever located, to any person located in the Russian Federation, pursuant to Executive Order (E.O.) 14071.”
That comes after U.K. Foreign Secretary Liz Truss last week announced a ban on similar services. “The new measures will mean Russia’s businesses can no longer benefit from the U.K.’s world-class accountancy, management consultancy, and PR services,” the U.K. news release said.
The process of business disentanglement from Russia began several months ago, not long after the invasion of Ukraine. To varying degrees, numerous organizations, including all of the Big Four accounting firms, have ceased operations and/or stopped doing business in Russia or with Russian companies.
Here’s one example of an accounting firm’s statement about Russia, from early March by BDO: “No BDO firm will work with any sanctioned Russian and Belarussian entities including the Russian and Belarussian Government, Russian and Belarussian state-owned enterprises and sanctioned individuals as a consequence of the ongoing situation in Ukraine.”
A statement Monday by the Association of International Certified Professional Accountants, the combined voice of the American Institute of CPAs (AICPA) & The Chartered Institute of Management Accountants (CIMA), expressed support for implementing economic and trade sanctions and other measures in response to the Russian military invasion of Ukraine.
“We will continue to monitor the situation to address any further impacts on the profession. Our primary focus remains on members, students, and staff impacted by this war. We are developing and releasing resources to help our members and the broader accounting and finance profession address the urgent economic challenges stemming from sanctions, supply chain disruption, and other issues.”
In March, the Association announced an indefinite suspension of services in Russia and Belarus.
Visit the Ukraine-Russia War Resource Center for more information.
— To comment on this article or to suggest an idea for another article, contact Neil Amato at [email protected].