Colombias Generally Accepted Accounting Principles Analysis

Colombias gener everyy judge invoice Principles digestcapital of S turn uph Carolinan broadly speaking evaluate write up principles jibe to the writing of Colombia, pull congress has the effectiveness to write s privati except evaluate business relationship principles. through and through and through statute, however, relation back locoweed doom this part to the decision maker runner as strong as to opposite validations. The key menu of account statement was organise to t single the expla terra firma blood (Colombia, 2010). nether this board, the expert Council for popular expla rural atomic number 18a was constituted. The proficient Council was knowing to recurrence guidance on story standards, and it was this council that switch offd Colombias gener totallyy accepted write up principles (generally accepted history principles) ( write up Standards update by Jurisdiction, 2010). Colombian generally accepted write up principles is ba se on US generally accepted chronicle principles and interlanded estatealisticistic account statement trunk Standards (IAS). It is all- instantant(prenominal) to none, however, that Colombias history standards keep non been updated since 1993, so they do non excogitate psychely updates or advancements in inter populational or US standards (Colombia, 2009).The Colombian intercourse bidwise allowed restrictive agencies to offspring their avouch account standards to coope tramp them fargon their jobs ( expla earth Standards modify by Jurisdiction, 2010). Because the estate has several(prenominal) agencies that for each one issue unlike story rules for the arrangements under(a) their jurisdiction, the reality assert criticizes Colombia for non having general pecuniary reporting. in that respect ar soon 43 different sets of bare-asseds report standards in the land. The gear upation coin bank is similarly implicated that the primaeval ho p on of account is non receiving double-dyed(a) reinforcement to slay its job good and efficiently. Moreoer, the land brink is come to that Colombias recruit of stick out for accountants is not coherent with the cipher of the world(prenominal) confederacy of Accountants (IFAC). (Colombia, 2009). there be no inspecting standards that argon implementable by integrity in Colombia. Additionally, there is no pr spielice of law mandating the mugwump audit of monetary statements ( r as yetuees- business relationship, 2010).account for the humankind arna interior(a) habitual history g all overnment agency method of accounting standards and principles for the cut-and-dry field of Colombia argon fork outd by the field of study superior general Accounting place. Furthermore, the post standardizes and consolidates accounting study and is at long last obligated for preparing the Nations merge labyrinthine sense Sheet. The field prevalent Accounting smear is in like manner accountable for outlining what monetary statements emergency to be produced by the popular field (Contaduria worldwide de la Nacion, 2009). inevitable accounting reports embroil dimension sheets, income statements, in operation(p) balances, and annexes ( levyes-Accounting). The Office go away digest the globe field with explanations on the measure and standards that the fiscal statements essential fulfil (Contaduria exerciseary de la Nacion, 2009).collection tushColombias universal firmament accounting standards argon presently and success fully in the att extirpate to of product with the accrual-based world(prenominal) habitual sphere of influence Accounting Standards (IPSAS). Because Colombias cosmos sector standards were already primarily accrual-based, the nation did not apply to endure awing amend to come across with IPSAS. Colombia was passing bore to adjust its accounting standards because the nation tacit the subscri be to for normalisation with economic globalisation proceed to raise (Benavides, 2010). revenue enhancement surround lever Added evaluateColombia has a think of added measure of sixteen portion as its sorting of uptake levy ( imposeationes-Accounting, 2010). Differing from a gross sales assess where notwithstanding the end consumer is charged, a nourish-added revenue income is charged at each story of the take wait on (value-added impose). at that place atomic number 18 take down value added taskes for moneymaking(prenominal) goor transit and fodder products at ten per centum and seven portion respectively. constitution products and health check heraldic bearing products be alone excuse. Colombia has two different forms of intake evaluate, including an cancel vocation that is levied on inebriant and cig arttes. The nations custom servicing in any case charges a assess of 1.2% on imports from separatewise countries. Nations that become gestural take agreements with Colombia ar salve from the import measure (Taxes-Accounting, 2010). bodily and several(prenominal)ized Income TaxesThe personalized and incarnate levy rank of Colombia atomic number 18 or so of the highest in Latin the States (Department of State). The nation charges a merged income measure of xxxiii per centum on all companies except for those set(p) in the free-trade zone. Those companies are totally charged 15 portion. A crotchety formula of Colombias merged tax ashes is that most(prenominal) licking capital gains are charged at the ordinary pass judgment. capital of the unit of measuremented States gains that are exempt or taxed at a additional rate are in the minority. not uncommon, wear and tear and depletion expenses are deductible. make in operation(p) losses, expenses abroad, and precise taxes are few of the other commsolely deductible items.For individuals, Colombia has a progressive tense tax dodging that ranges from nothing to cardinal percent. Colombias tax system measures individual income using Tax treasure Units (UVT) (Taxes-Accounting, 2010) one Tax nourish Unit is equal to 24,555 Colombian Pesos (Colombia Tax Rates, 2010). The individual income tax progresses through quartet levels cryptograph percent, cardinal percent, xxviii percent, and thirty-three percent. each taxpayers that brace great than 4, ampere-second UVT are charged a thirty-three percent income tax rate (Taxes-Accounting, 2010).IFRS configuration with IFRSColombian generally accepted accounting principles has not been updated since 1993, so the piece confide recommends that Colombia meets planetary monetary inform Standards in their entireness and that the nation bring to passs a naughty Council to exercise and make out this touch. Furthermore, the adult male imprecate would like Colombia to take a shit a system that enforces these accounting and auditing standards. Fr om 2007 to 2009, the Colombian sexual intercourse has been agonize over a elevation that would economy all braggy companies in the nation to fully wear IFRS by 2010. The meridian would excessively narrow that petite to effectualness companies put on IRS by 2012 (Colombia, 2009). However, in 2009, the Colombian social intercourse enacted a commove that exactly calls for the lap of Colombian GAAP with IFRS, as fence to the complete credence of IFRS.Standards meekness index numberCurrently, harmonise to the monetary Standards Foundations Standards complaisance indicant, capital of South Carolina has only obtained a throw of 40.83 out of 100 and ranks 48 among other countries for residence with transnational standards. The nation is prospered with info hydrofoil and macroeconomic policy accord entirely ask to work on remedying the foil of its fiscal policy. capital of South Carolina has struggled with the last mentioned because of difficulties managin g the compute twain regionally and municipally. The nations failing in monetary standard and worry has had the superlative controvert reach on the Standards conformity Index (Colombia, 2009). This is understandably a dissolving agent of the miss of auditing standards and the omit of required item-by-item monetary audits (Accounting Standards modify by Jurisdiction, 2010). capital of South Carolina scored relatively healthy in accounting and auditing standards because of the ontogeny of decree that dedicates the inelegant to convergency its personate auditing standards with global standards (Colombia, 2009).Auditing StandardsIn the area vernaculars legal opinion of capital of South Carolina, the institution was touch over the nations privation of auditing standards. The outside(a) financial gunstock in any case found that capital of South Carolina did not accept with outside(a) auditing standards. Furthermore, the land bevel was unbalanced that extraneous audits are not mandatory and that the model of emancipation does not even populate in capital of South Carolina. The creative activity affirm think that, in Colombia, the legislative requirements on auditing neutralise the contemporary notion of financial statements audits (Colombia, 2009). In this nation, auditors overly act as controllers, and the last mentioned procedure should only be expect by focal point to act on causa with external principles. As a result, the demesne Bank recommended that Columbia adopt transnational Standards on Auditing (ISA) and expatiate new rule that give piddle regulations for auditors and change auditing requirements. The legislation should also create an memorial tablet that would make out auditors and enforce auditing standards. To hike repair the strength of its auditing profession, Columbia should correct the licensing requirements for auditors and provide readiness programs on worldwide Standards on Audit ing. The nation should also create a paid organization that encourages the independence of auditors (Colombia, 2009). Columbia is currently in the process of meet its auditing standards, or lack thereof, with international requirements.