Dominican Republic

Member Organizations

Member Organization Associate Other PAOs

  Instituto de Contadores Públicos Autorizados de la República Dominicana

Legal and Regulatory Environment

  • Overview of Statuatory Framework for Accounting and Auditing

    The financial reporting framework in the Dominican Republic is established by the Company Law and its amendments (Law 479 of 2008) and the Code of Commerce, last amended in 1953. The Code of Commerce establishes the obligation for companies to keep books of accounts and provides the basic legal framework for accounting and auditing. The Company Law sets requirements for companies with capital in excess of 100 times the monthly minimum wage to present audited financial statements. In addition, the Company Law stipulates external audit obligations for any business entity that is party to a contract of any nature with the Dominican State, for an amount in excess of RD$50,000. These audits must be in accordance the auditing standards issued by the Instituto de Contadores Públicos Autorizados de la República Dominicana (ICPARD).

    Under the Laws 479 of 2008, 633 of 1944 and the Decree 2032 of 1984, accounting and auditing standard-setting for non-regulated entities falls under the purview of the ICPARD. The ICPARD has adopted IFRS and ISA since 1999, and IFRS for Small- and Medium-sized Entities (SMEs) since 2014 through ICPARD’s technical resolutions. The ICPARD technical resolution that established IFRS for SMEs also defined the criteria of SMEs as companies that do not have an obligation to present public financial statements, companies that do not trade debt or equity in a public market or in the process of issuing this instrument in the public market, and companies that do not hold assets in different lines of businesses.

    The financial reporting requirements for banks, listed companies, insurance companies, and pension funds are established by the respective regulators as follows:

    The Superintendence of Securities (SIV) regulates and supervises the capital market. Through Decree 729 of 2004 and Circular C-SIV-2011-12-MV, the SIV has stipulated that listed companies must apply IFRS as issued by the ICPARD. Similarly, the SIV requires all listed companies to submit their annual audited financial statements in accordance with ISA as adopted by the ICPARD.

    The Superintendence of Banks (SB) supervises banks and similar financial institutions, which under the Monetary and Financial Law include commercial banks, savings and credit banks, and credit corporations while the Superintendence of Pensions (SIPEN) and Superintendence of Insurance (SIS) regulate pension funds and insurance companies, respectively. The SB, SIPEN, and SIS require entities under their supervision to annually submit audited financial statements but do not require the use of IFRS and have issued other resolutions establishing reporting requirements and rules.

    These rules can override ICPARD-endorsed standards in cases of conflict. However, several of the country’s banks are listed companies and therefore are required to prepare financial statements under IFRS. It is unclear which auditing standards the SB, SIPEN, and SIS require or if they refer to ICPARD-issued auditing standards.

  • Regulation of Accountancy Profession

    In the Dominican Republic the accountancy profession is regulated at the state level by the Ministry of Finance (MoF) and at the professional level by the Instituto de Contadores Públicos Autorizados de la República Dominicana (ICPARD). Under the Dominican Republic law, the MoF is responsible for issuing a license to professional accountants who are then permitted to use the title of Certified Public Accountants (CPA). A university accounting degree and membership in ICPARD are the only entry requirement established by the MoF in order to practice accountancy.

    Under the Law 633 of 1944 and the Decree 2032 of 1984, the ICPARD is authorized to carry out certain regulatory responsibilities for CPAs and audit firms such as: (i) establishing accounting, auditing, ethical, and other professional standards for application; (ii) monitoring its members’ compliance with the code of ethics; (iii) maintaining registers of CPAs and firms; (iv) investigating and disciplining its members; and (v) promoting the advancement of the profession by establishing continuing professional development requirements for its members. As mentioned above, membership of ICPARD is mandatory for all practicing accountants and only ICPARD members are authorized to issue audit reports.

    In addition, audit firms who provide services to entities under the supervision of the Superintendences of securities, banks, pensions, and insurance are subject to the regulation of the respective regulator. Each Superintendence maintains registries of audit firms authorized to audit companies under their control, requires all CPAs and audit firms to be members of the ICPARD, establishes accounting and auditing standards for regulated companies, and conducts inspections of audit firms.

  • Audit Oversight Arrangements

    There are no independent audit oversight arrangements in the Dominican Republic and auditors in the country are regulated at the state level by the Ministry of Finance (MoF) and at the professional level by the Instituto de Contadores Públicos Autorizados de la República Dominicana (ICPARD). Under the law, the MoF is responsible for issuing a license to professional accountants who are then permitted to use the title of Certified Public Accountants (CPA). A university accounting degree is the only entry requirement established by the MoF in order to practice accountancy although the MoF will only issue a license to individuals who are members of ICPARD in good standing.

    Under the Law 633 of 1944 and the Decree 2032 of 1984, the ICPARD is authorized to carry out certain regulatory responsibilities for Certified Public Accountants and audit firms such as: (i) establishing auditing, ethical, and other professional standards for application; (ii) monitoring its members’ compliance with the code of ethics; (iii) maintaining registers of CPAs and firms; (iv) investigating and disciplining its members; and (v) promoting the advancement of the profession by establishing continuing professional development requirements for its members. Membership of ICPARD is mandatory for all practicing accountants and only ICPARD members are authorized to issue audit reports.

    In addition, audit firms who provide services to entities under the supervision of the Superintendences of securities, banks, pensions, and insurance are subject to the regulation of the respective regulator. Each Superintendence maintains registries of audit firms authorized to audit companies under their control, requires all CPAs and audit firms to be members of the ICPARD, establishes auditing standards for regulated companies, and conducts inspections of audit firms.

  • Professional Accountancy Organizations

    The Instituto de Contadores Públicos Autorizados de la República Dominicana (ICPARD)

    Under the Law 633 of 1944 and the Decree 2032 of 1984, the ICPARD was established as an organization uniting Certified Public Accountants (CPA). It is authorized to carry out certain regulatory responsibilities for CPAs and audit firms such as: (i) establishing accounting, auditing, ethical, and other professional standards for application; (ii) monitoring its members’ compliance with the code of ethics; (iii) maintaining registers of CPAs and firms; (iv) investigating and disciplining its members; and (v) promoting the advancement of the profession by establishing continuing professional development requirements for its members. CPAs and audit firms must be a member of the institute in order to practice accountancy in the jurisdiction.

    In addition to being a member of IFAC, the ICPARD is a member of the Inter-American Accounting Association (AIC) and the Group of Latin American Accounting Standards Setters (GLENIF).

    The Asociación de Firmas de Contadores Públicos Autorizados (AFCPARD)

    The AFCPARD was founded in October 1996 by a group of audit firms. It membership includes only audit firms. The AFCPARD states that it supports ICPARD’s activities and actions to achieve compliance with the IFAC Statements of Membership Obligations. It does this by focusing its efforts on training activities.

    The Colegio Dominicano de Contadores (CODOCON)

    The CODOCON was founded in December 1976 and is a professional accountancy organization with voluntary membership. The CODOCON states that it promotes and contributes to the advancement of the profession. The CODOCON focuses its activities in training activities and does not have international affiliations.

  • Projects or Other Information

    The Instituto de Contadores Públicos Autorizados de la República Dominicana (ICPARD) has signed an agreement with the Inter-American Accounting Association (AIC) to adopt and implement a voluntary QA system. The agreement seeks to implement a pilot program for the 30 largest firms. The project was going to start in January 2016.

Adoption of International Standards

  • Quality Assurance

    A mandatory quality assurance review system in line with SMO 1 requirements does not exist in the Dominican Republic. Limited quality control reviews of auditors providing services to regulated entities are conducted separately by the regulators.

    The Superintendence of Banks has created the Audit Control Unit which is in charge of reviewing applications for the auditor registry and conducting inspections of audit firms. The Superintendence of Insurance created the Inspection Direction, under Article No 250 of the Law 146 of 2002, which is in charge of making all checks, inspections, and investigations of its regulated entities. However, it is unclear if these systems are operational and if so, the extent of fulfillment of each regulators’ QA review system with the practices of the SMO 1. In addition, no further information on the QA systems of the Superintendence of Securities and the Superintendence of Pensions is available.

    The Instituto de Contadores Públicos Autorizados de la República Dominicana (ICPARD) has adopted ISQC 1 for application by its members, which are the only individuals authorized to issue audit reports, and is in the process of developing a voluntary quality assurance system in line with the SMO 1 requirement for its members with the support of the Inter-American Accounting Association.

    Current Status: Not Adopted

  • International Education Standards

    In the Dominican Republic, the Ministry of Finance, universities, and the Instituto de Contadores Públicos Autorizados de la República Dominicana (ICPARD) have a role in setting initial professional development (IPD) and continuing professional development (CPD) requirements for professional accountants. A university accounting degree and membership in ICPARD are the only entry requirement established by the MoF in order to practice accountancy. Universities have authority over the accounting curriculum and issuing professional degrees.

    The ICPARD has limited authority to incorporate the requirements of IES into national requirements and may only stipulate CPD requirements for members. ICPARD members are required to annually complete CPD requirements which the institute indicates are in line with the IES requirements.

    Although some of the requirements of IES appear to have been incorporated into the national requirements, such as CPD, it is not clear if other national requirements incorporate the IES.

    Current Status: Partially Adopted

  • International Standards on Auditing

    The Law 479 of 2008, the Law 633 of 1944, and the Decree 2032 of 1984, authorize the Instituto de Contadores Públicos Autorizados de la República Dominicana (ICPARD) to prescribe auditing standards to be applied by its members in the audits of non-regulated companies. The ICPARD has adopted the Spanish translations of ISA since 1999 through ICPARD’s technical resolutions without modifications. However, the version of ISA adopted is unclear. Auditing standards for banks, listed companies, insurance companies, and pension funds are established by the respective regulators. In accordance the Circular C-SIV-2016-07-MV, the Superintendence of Securities has adopted the most recent version of ISA. However, it is unclear what auditing standards may be required by the other regulators and whether the Superintendence of Banks, the Superintendence of Pensions, and/or the Superintendence of Insurance has plans to mandate the application of ISA for audits of entities under their supervision.

    Current Status: Partially Adopted

  • Code of Ethics for Professional Accountants

    Under the Law 633 of 1944 and the Decree 2032 of 1984, the Instituto de Contadores Públicos Autorizados de la República Dominicana (ICPARD) is responsible for setting ethical requirements for the profession. Membership of ICPARD is mandatory for all practicing accountants.

    The ICPARD has adopted a Code of Ethics based on the 2009 IESBA Code of Ethics for its members. However, the extent of alignment of the Code with the requirements of the IESBA Code of Ethics needs to be clarified.

    Current Status: Partially Adopted

  • International Public Sector Accounting Standards

    In accordance the Decree No. 526 of 2009, the General Agency of Government Accounting (DIGECOG)—the governmental organization responsible for adopting the standards—has adopted the 2011 IPSAS. The expected dates for implementation are Central Government (2016–2021); Decentralized Agencies (2017–2022); and City Halls (2018–2023).

    Current Status: Adopted

  • Investigation and Discipline

    In accordance with the Law 633 of 1944 and the Decree 2032 of 1984, the Instituto de Contadores Públicos Autorizados de la República Dominicana (ICPARD) is responsible for investigating and disciplining (I&D) professional accountants in the jurisdiction. Membership of ICPARD is mandatory for all practicing accountants.

    The ICPARD has created an Investigation, Qualifications and Ethics Committee and a Disciplinary Tribune to carry out the I&D functions; however, it is unclear if ICPARD’s I&D system incorporates the SMO 6 requirements.

    Current Status: Partially Adopted

  • International Financial Reporting Standards

    Under the Law 479 of 2008, the Law 633 of 1944, and the Decree 2032 of 1984, the Instituto de Contadores Públicos Autorizados de la República Dominicana (ICPARD) is authorized to set accounting standards for non-regulated companies. The ICPARD has adopted the Spanish translations of IFRS since 1999 and IFRS for SMEs since 2014 without modifications through ICPARD’s technical resolutions.

    Accounting standards for regulated companies are established by the respective regulators. The Superintendence of Securities (SIV) is the accounting standard-setter for listed companies and has adopted IFRS as issued by ICPARD through the SIV Circular C-SIV-2011-12-MV.

    Companies supervised by the Superintendence of Banks (SB), the Superintendence of Pensions (SIPEN), and the Superintendence of Insurance (SIS) do not require IFRS. These regulators set their own specific rules that override ICPARD-endorsed standards in cases of conflict. However, several of the country’s banks are listed companies and therefore are required to prepare financial statements under IFRS. It is unclear whether the SB, SISPEN, and/or SIS, have plans to adopt IFRS as issued by the ICPARD.

    In addition, ICPARD reports that Dominican regulation also allows some companies to present their financial statements under U.S. GAAP. However, both the law and which companies may use U.S. GAAP needs further clarification.

    Current Status: Partially Adopted

Disclaimer

IFAC bears no responsibility for the information provided in the SMO Action Plans prepared by IFAC member organizations. Please see our full Disclaimer for additional information.

Methodology

Methodology
Last updated: 11/2018
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