lvi. lvi. In order to strengthen corporate governance, the country has ratified 19 out of the 23 conventions relating to the environment. A further four have been signed but not ratified, while the status of the Vienna Convention for the Protection of the Ozone Layer (the Montreal Protocol on Substances that Deplete the Ozone Layer) is not yet clear. Mozambique is at different levels of compliance with the core principles governing the supervision of banks, the regulation of the securities market and oversight of the insurance industry, although these are all voluntary. lvii. Mozambique is also a signatory to various conventions on the environment, labour, trade and others that are relevant to corporate governance themes. Article 18 of the Constitution recognises that international conventions ratified by the Mozambican Parliament as part of the internal juridical order shall have the same value as the internal laws and regulations. lviii. Financial accountability is generally low. This is mainly because Mozambique has been operating government accounting systems that did not adhere to International Financial Reporting Standards (IFRS) or International Standards on Auditing (ISA). The systems differ from IFRS standards in the following areas: • Inventory calculation; • Intangible assets; • Historical cost and continuity principles; • Long-term construction contracts; • Balance sheet presentation; • The lack of coverage; and • The mandatory use of the Portuguese language. lix. In response to these weaknesses, Mozambique has now adopted IFRS to apply to all banks from 2008, by directive of the Bank of Mozambique (BM), and has agreed to apply IFRS to other enterprises by 2010. lx. The above measures, together with the implementation of the 2005 Commercial Code for financial institutions and listed companies (although still very few), will greatly improve the situation in the medium and long term. lxi. Mozambique has continued to implement far-reaching financial policy reforms, including privatising major state-owned banks, transforming the central bank into a banking supervisory authority, and monitoring the exchange rate and monetary policies. The BM has passed a series of regulations that set the rules of the banking system. Here Mozambique has adopted the Core Principles for Effective Banking Supervision (CPEBS), and the country is working with the international banking system to implement best practices. lxii. Mozambique has also complied with 17 of the 27 Basel Core Principles for Effective Banking Supervision, partially complied with a further four, and four are 13