The Dominican Republic, like other countries, needs IFRS to harmonize accounting standards internationally and to enter the foreign market. These standards are issued by the International Accounting Standards Board (IASB).
The goal of IFRS is to make accounting similar across all countries, which is why it is based on international standards. Its predecessor was IAS (International Accounting Standards), which had the same goal.
International Financial Reporting Standards (IFRS) are fundamental for analyzing financial statements.
What are International Financial Reporting Standards (IFRS)?
International Financial Reporting Standards (IFRS), known in English as IFRS (International Financial Reporting Standards).
They are a set of standards, laws, and principles that establish the necessary information companies must present in their financial statements, as well as the way this information should be presented.
If you need advice on presenting your company’s financial statements, at Contadores Dominicanos, we are ready to provide the necessary help for your company or corporation.
The financial statements proposed by IFRS are the following:
- Statement of financial position or balance sheet.
- Statement of profit or loss and other comprehensive income.
- Statement of changes in equity.
- Statement of comprehensive income.
- Statement of cash flows.
Content of IFRS:
Benefits of IFRS:
- Presentation of transparent and comparable financial statements between different countries.
- Greater access for companies to capital markets.
- Easier international expansion.
- Facilitates economic decision-making.
IFRS Standards Adopted by the Dominican Republic:
The Institute of Authorized Public Accountants in the Dominican Republic (ICPARD) authorizes the use of International Financial Reporting Standards, full IFRS and IFRS for SMEs, issued by the IASB.
Article 31 of the General Law of Commercial Companies and Limited Liability Individual Companies (Law No. 479-08) establishes that financial statements must be prepared in accordance with the accounting principles and/or standards established by the Institute of Authorized Public Accountants (ICPARD).
It is important to mention that ICPARD is a professional body and a member of the International Federation of Accountants (IFAC), responsible for issuing International Auditing Standards through the International Auditing Standards Board (IASB).
The IASB is responsible for issuing IFRS and interpreting their application.
IFRS for SMEs in the Dominican Republic:
These apply in the Dominican Republic to companies:
- Classified as medium-sized according to Law 488-08.
- Companies exceeding the medium-sized limit but not listed on the Dominican Republic Stock Exchange or listed by the Securities Superintendency.
Micro Entities applying IFRS for SMEs:
Micro entities may use the IFRS for Micro Entities guidance published by the IASB in June 2013 if they meet the requirements specified in Article 2 and the following criteria:
- Few employees.
- Low or moderate levels of revenue, ordinary activities, and gross assets.
- No investments in subsidiaries, associates, or joint ventures.
- No complex financial instruments.
- Not issuing shares or options on shares for employees or third parties.
Full IFRS:
These apply in the Dominican Republic to companies:
- Listed on the Dominican Republic Stock Exchange.
- Companies in the process of issuing financial instruments in the Dominican Republic securities market.
Note: Companies using U.S. Generally Accepted Accounting Principles (US GAAP) may continue to use them.
We have the best professionals and advisors; visit our website and learn about the services we offer for you and your company.
