International Federation of Accountants

Chile

Member Organizations

Member Organization Associate

  Colegio de Contadores de Chile

Legal and Regulatory Environment

  • Overview of Statutory Framework for Accounting and Auditing

    The financial reporting framework in Chile is established under the Companies Law No. 18.046 of 1981. The Companies Law contains basic requirements for financial reporting for all companies in Chile, including requirements for the preparation of financial statements. The Companies Law defines two types of corporations: open and closed corporations. Open corporations have 500 or more shareholders and at least 10% of subscribed capital must belong to a minimum of 100 shareholders. Open corporations are statutorily regulated by the Financial Market Commission (CMF). Closed corporations may voluntarily register and be regulated by the CMF under the Registry of Informants.

    The Law No. 13.011 of 1958 delegates the Colegio De Contadores De Chile (CCCH) the responsibility for setting accounting standards for non-regulated companies. The CCCH has adopted IFRS and for IFRS for Small- and Medium-sized Entities (SMEs) since 2013.

    The CMF is the financial sector regulator in Chile as of 2019, overseeing open corporations, listed and insurance companies, banks, and financial institutions, when the Superintendent of Banks and Financial Institutions (SBIF) became part of the CMF, despite the unification, regulated entities are subject to different requirements. The CMF is empowered to set accounting and financial reporting requirements for companies under its supervision. The CMF has adopted IFRS since 2009. When adopting IFRS, the SBIF made significant modifications. According to the IFRS Foundation, the financial statements of banks and other financial institutions are described as complying with the standards issued by SBIF, not IFRS.

    As far as auditing requirements are concerned, non-regulated companies are required to have their financial statements audited in accordance with the Chilean Generally Accepted Auditing Standards (NAGAs) issued by the CCCH, in accordance the Law 13.011 of 1958. The CCCH reports that the NAGA are the translation of the standards issued by the Audit Standards Board of the American Institute of Certified Public Accountants, which, in turn, are based on ISA. The CMF has the authority to set the auditing standards for entities under its regulation and require the application of standards issued by the CCCH.

  • Regulation of Accountancy Profession

    Only audit firms are regulated at the state level through the supervision of the Financial Market Commission (CMF), in accordance with Law 18,045 of 1981. The law requires audit firms to be registered in the CMF’s Registry of External Auditors (RAE) and individual professionals registered in the register of auditors and account inspectors (RICAE). The CMF is empowered to: (i) maintain a registry of audit firms authorized to audit companies under its control; (ii) set ethical requirements; (iii) develop an investigative and disciplinary (I&D) system; and (iv) require audit firms to establish quality control mechanisms. Audit reviews are only carried out when a suspicion or risk is identified.

    All other accountancy professionals may voluntarily join a professional accountancy organization (PAO) and be self-regulated through the membership requirements of the PAO.

    Universities, the National Accreditation Commission, the Ministry of Education and the Superintendency of Higher Education have a role in implementing initial professional development (IPD) requirements for all professional fields, including professional accountants, established in Law No. 20.370 and Law No. 20.129. However, according to the Colegio de Contadores de Chile (CCCH), there are no minimum requirements to practice accountancy in Chile.

    Prior to 1981, all practicing accountants were required to register with the Colegio de Contadores de Chile (CCCH) and adhere to its rules and regulations. However, in 1981, Law No. 13.011 of 1958, which created the CCCH, was modified by the Law No. 3.621 of 1981. The modifications eliminated the obligation to be registered with the CCCH. The CCCH now unites professional accountants, including auditors, in the jurisdiction through voluntary membership, and requires its candidates to hold a bachelor’s degree in accounting in order to be considered for membership. In accordance with the law, the CCCH’s responsibilities include the following: (i) setting accounting and auditing standards for non-regulated companies; (ii) issuing professional and ethical standards for its members; (iii) establishing membership requirements; (iv) investigating and disciplining its members; (v) providing training programs; and (vi) representing and promoting the accountancy profession.

  • Audit Oversight Arrangements

    There is no independent audit oversight authority in Chile. Only audit firms under the Financial Market Commission’s (CMF) supervision are subject to regulation. The CMF is empowered to: (i) maintain a registry of audit firms authorized to audit companies under its control; (ii) set ethical requirements; (iii) develop an investigative and disciplinary (I&D) system; and (iv) require audit firms to establish quality control mechanisms. Audit reviews are only carried out when a suspicion or risk is identified.

    In addition, professionals – including auditors – that voluntarily join a professional accountancy organization (PAO) are subject to requirements established by the PAO, such as professional and ethical standards, and investigative and disciplinary mechanisms.

  • Professional Accountancy Organizations

    The Colegio de Contadores de Chile (CCCH)

    The CCCH, created by the Law 13.011 of 1958, is a voluntary professional accountancy organization with responsibilities such as: (i) setting accounting and auditing standards for non-regulated companies; (ii) issuing professional and ethical standards for its members; (iii) establishing membership requirements; (iv) investigating and disciplining its members; (v) providing training programs; and (vi) representing and promoting the accounting profession.

    In addition to being an IFAC Member, the CCCH is a member of the Inter-American Accounting Association and the Integration Committee Europe—Latin America, and a member of the Group of Latin-American Accounting Standard Setters.

  • Projects or Other Information

Adoption of International Standards

  • Quality Assurance

    There is no legal requirement to establish a quality assurance (QA) review system for all audits of financial statements in Chile. While the Law No. 18.045 does set the legal foundation for the establishment of QA for auditors providing services to listed companies, as of 2021, no mandatory QA review system has been implemented. The Financial Market Commission (CMF) requires audit firms listed in the Registry of External Auditors (RAE) to establish quality control mechanisms. However, audit reviews are only carried out when a suspicion or risk is identified.

    The CMF recognizes the Audit Standards Committee of the Colegio de Contadores de Chile (CCCH) as the auditing standard-setter. The CCCH translates and adopts auditing and quality control standards as issued by the Audit Standards Board of the American Institute of Certified Public Accountants, which, in turn, are based on ISA and ISQC1.

    Current Status: Not Adopted

  • International Education Standards

    Universities, the National Accreditation Commission, the Ministry of Education and the Superintendency of Higher Education have a role in implementing initial professional development (IPD) requirements for all professional fields, including professional accountants, established in the Law No. 20.370 and the Law No. 20.129. The Colegio de Contadores de Chile (CCCH) reports that the universities providing accountancy education programs have partially adopted the 2019 IES requirements. However, according to the CCCH, there are no minimum requirements to practice accountancy in Chile and no mandatory continuing professional development requirements.

    The CCCH reports that it requires its candidates to hold a bachelor’s degree in accounting in order to be considered for membership.

    Current Status: Not Adopted

  • International Standards on Auditing

    In accordance with the Law No. 13.011 of 1958, the Colegio de Contadores de Chile (CCCH) is responsible for setting auditing standards for non-regulated companies. The Auditing Standards Committee of the CCCH adopts the Chilean Generally Accepted Auditing Standards (NAGAs), which, as reported by the CCCH, are the translation of the standards issued by the Audit Standards Board of the American Institute of Certified Public Accountants, which, in turn, are based on ISA.

    The Financial Market Commission (CMF) has the authority to set the auditing standards for entities under its regulation and require the application of standards issued by the CCCH.

    Current Status: Partially Adopted

  • Code of Ethics for Professional Accountants

    The Law No. 13.011 of 1958 authorizes the Colegio de Contadores de Chile (CCCH) to set ethical requirements for its members. Accordingly, the CCCH has developed its own Code of Ethics, updated in 2022, while utilizing the latest version of the International Code of Ethics for Professional Accountants as a supplement to its own Code.

    The Financial Market Commission (CMF) has the authority to determine ethical requirements for auditors of entities under its supervision. As of the date of the assessment, the CMF has not issued a specific regulation related to ethical requirements. In practice, as reported by the CCCH, audit firms listed in the Registry of External Auditors (RAE) and individual professionals registered in the register of auditors and account inspectors (RICAE) adhere to the CCCH Code of Ethics.

    Current Status: Partially Adopted

  • International Public Sector Accounting Standards

    The Constitution of Chile and the Law No. 10.336 establish the Controller General of the Republic of Chile (CGRCH) as the accounting standard-setter for the public sector. The CGRCH has developed accrual - IPSAS modified for local context (2013 version) through the Resolution No. 16 of 2015, effective since January 1, 2016.

    Current Status: Partially Adopted

  • Investigation and Discipline

    The Law No. 13.011 of 1958 authorizes the Colegio de Contadores de Chile (CCCH) to establish an investigative and disciplinary (I&D) system for its members and it has established and implemented I&D procedures accordingly. The CCCH conducted an assessment of its I&D policies and processes against the requirements of SMO 6 and has identified gaps, such as the composition of members of the I&D committee, results of the investigative and disciplinary proceedings are not made available to the public, and the CCCH is prohibited by the Chilean Constitution to impose penalties like loss of professional designation or exclusion from membership, among others.

    The Financial Market Commission (CMF) has responsibility for the I&D of audit firms registered in the Registry of External Auditors (RAE) and individual professionals registered in the register of auditors and account inspectors (RICAE). The extent to which the I&D system established by the CMF is in line with the best practices of SMO 6 is unclear.

    According to the CCCH, all other professionals not registered in the REAE, RICAE, and non-CCCH members are subject to the state’s legal system.

    Current Status: Partially Adopted

  • International Financial Reporting Standards

    The Law No. 13.011 of 1958 authorizes the Colegio de Contadores de Chile (CCCH) with the responsibility for setting accounting standards for non-regulated companies. The CCCH has adopted IFRS, through the Technical Bulletin (TB) No. 85, and IFRS for Small- and Medium-sized Entities (SMEs) by the TB No. 2, since 2013.

    The CMF is the financial sector regulator in Chile as of 2019, overseeing open corporations, listed and insurance companies, banks, and financial institutions, when the Superintendent of Banks and Financial Institutions (SBIF) became part of the CMF, despite the unification, regulated entities are subject to different requirements. The CMF is empowered to set accounting and financial reporting requirements for companies under its supervision. The CMF has adopted IFRS since 2009. When adopting IFRS, the SBIF made significant modifications. According to the IFRS Foundation, the financial statements of banks and other financial institutions are described as complying with the standards issued by SBIF, not IFRS.

    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: 11/2022
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