Dominican Republic

The financial reporting framework in the Dominican Republic is established by the Company Law and its amendments (Law No. 479-08 of 2008, as amended by Law No. 31-11) and the Código de Comercio, last amended in 1953. The Código de Comercio establishes the obligation for companies to maintain books of account 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 a party to a contract of any nature with the Dominican State for an amount in excess of RD$50,000. These audits must be conducted in accordance with the auditing standards issued by the Instituto de Contadores Públicos Autorizados de la República Dominicana (ICPARD).

Under Law No. 479-08, Law No. 633 of 1944, and Decree No. 2032 of 1984, accounting and auditing standard-setting for non-regulated entities falls under the purview of ICPARD. ICPARD has adopted International Financial Reporting Standards (IFRS Accounting Standards) and International Standards on Auditing (ISA) since 1999, and the IFRS for Small and Medium-sized Entities (SMEs) Accounting Standard since 2014 through its technical resolutions. The ICPARD technical resolution that established the IFRS for SMEs Accounting Standard also defines SMEs as companies that do not have an obligation to present public financial statements, do not trade debt or equity instruments in a public market or are not in the process of issuing such instruments, and do not hold assets in a fiduciary capacity across different lines of business.

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 No. 729 of 2004 and Circular C-SIV-2011-12-MV, the SIV has stipulated that listed companies must apply IFRS Accounting Standards as issued by ICPARD. Similarly, the SIV requires all listed companies to submit their annual audited financial statements in accordance with ISA as adopted by 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 the 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 Accounting Standards and have issued separate resolutions establishing reporting requirements and prudential rules.

These rules may override ICPARD-endorsed standards in cases of conflict. However, several of the country’s banks are listed companies and are therefore required to prepare financial statements in accordance with IFRS Accounting Standards. It remains unclear which auditing standards the SB, SIPEN, and SIS require, or whether they explicitly refer to ICPARD-issued auditing standards.

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 Dominican law, the MoF is responsible for issuing licenses to professional accountants, who are then permitted to use the title of Certified Public Accountant (CPA). A university degree in accounting is the principal entry requirement established by the MoF in order to practice accountancy, although the MoF issues licenses only to individuals who are members of ICPARD in good standing.

Under Law No. 633 of 1944 and Decree No. 2032 of 1984, ICPARD is authorized to carry out certain regulatory responsibilities for CPAs and audit firms, including: (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 through the establishment of continuing professional development requirements for its members. As noted above, membership in ICPARD is mandatory for all practicing accountants, and only ICPARD members are authorized to issue audit reports.

In addition, audit firms that provide services to entities under the supervision of the securities, banking, pensions, and insurance regulators are subject to oversight by the respective regulator. Each Superintendence maintains a registry of audit firms authorized to audit entities under its supervision, requires all CPAs and audit firms to be members of ICPARD, establishes accounting and auditing requirements for regulated entities, and conducts inspections of audit firms.

There are no independent audit oversight arrangements in the Dominican Republic. Auditors in the jurisdiction 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). Please see the Regulation of the Accountancy Profession section for further details.

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

Under Law No. 633 of 1944 and Decree No. 2032 of 1984, the Instituto de Contadores Públicos Autorizados de la República Dominicana (ICPARD) was established as the professional accountancy organization uniting Certified Public Accountants (CPAs) in the jurisdiction. It is authorized to carry out specific regulatory responsibilities for CPAs and audit firms, including: (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 through the establishment of continuing professional development requirements for its members. CPAs and audit firms must be members of the institute in order to practice accountancy in the jurisdiction.

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

A quality assurance review system exists in the Dominican Republic, although it does not appear that a single jurisdiction-wide system fully aligned with the requirements of Statement of Membership Obligation 1 (SMO 1) is operational for all mandatory audits.

Under Law No. 633 of 1944 and Decree No. 2032 of 1984, the Instituto de Contadores Públicos Autorizados de la República Dominicana (ICPARD) is responsible for regulating its members, who are the only individuals authorized to issue audit reports in the jurisdiction. ICPARD established a quality control framework through its 2019 resolution on the adoption and implementation of quality control systems for firms performing audits, reviews of financial information, assurance engagements, and related services. According to information published by ICPARD, the implementation period ran on a voluntary basis until December 15, 2021, and a program of reviews of firms’ quality control systems was to begin on June 15, 2022.

In addition, the Superintendence of Banks (SB) operates a quality review process for audits of entities under its supervision. From January 2023, audit firms registered with the SB are required to comply with the International Standard on Quality Management 1 (ISQM 1), the International Standard on Quality Management 2 (ISQM 2), and International Standard on Auditing 220 (Revised).

Based on publicly available information, however, it remains unclear whether ICPARD’s system is fully operational in practice for all firms performing mandatory audits, whether it covers all mandatory audits in the jurisdiction, and whether the overall system fully incorporates all the requirements of SMO 1. It is also unclear whether regulators other than the SB operate comparable quality assurance review systems. Accordingly, Partially Adopted remains the most supportable assessment at this time.

Current Status: Partially Adopted

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

ICPARD has limited authority to incorporate the requirements of the International Education Standards (IES) into national requirements and may primarily stipulate CPD requirements for its members. ICPARD members are required to complete annual CPD requirements, which the institute indicates are aligned with the requirements of IES 7.

Only a selection of the IES requirements appears to have been adopted as part of the national accountancy education framework. In particular, there is limited publicly available information demonstrating alignment with the full suite of IES requirements in effect at the time of the assessment, including entry requirements, learning outcomes, practical experience, final assessment, and continuing professional development requirements for all aspiring and professional accountants. Further clarification on the extent to which national requirements align with the most recent IES framework remains necessary.

Current Status: Partially Adopted

Law No. 479-08 of 2008, Law No. 633 of 1944, and Decree No. 2032 of 1984 authorize the Instituto de Contadores Públicos Autorizados de la República Dominicana (ICPARD) to establish auditing standards to be applied by its members in the audits of non-regulated entities. ICPARD has adopted the International Standards on Auditing (ISA), as issued by the International Auditing and Assurance Standards Board (IAASB), by reference through ICPARD’s technical resolutions for application in the jurisdiction.

Auditing standards for banks, listed companies, insurance companies, and pension funds are established by the respective regulators. In accordance with Circular C-SIV-2016-07-MV, the Superintendence of Securities has adopted the most recent version of ISA for entities under its supervision.

However, it remains unclear which auditing standards are required by the Superintendence of Banks, the Superintendence of Pensions, and the Superintendence of Insurance, and whether these regulators require full application of ISA for audits of entities under their supervision. Accordingly, ISA do not appear to be demonstrably adopted for all mandatory audits in the jurisdiction, and Partially Adopted remains the most supportable assessment.

Current Status: Partially Adopted

Under Law No. 633 of 1944 and Decree No. 2032 of 1984, the Instituto de Contadores Públicos Autorizados de la República Dominicana (ICPARD) is responsible for establishing ethical requirements for professional accountants in the jurisdiction.

Based on publicly available information, ICPARD has adopted a Code of Ethics based on the 2009 International Ethics Standards Board for Accountants (IESBA) Code of Ethics. No publicly available legislation, regulatory publication, or professional pronouncement was identified to indicate that the 2018 or later version of the International Code of Ethics for Professional Accountants (including International Independence Standards) has been adopted.

Accordingly, as the ethical requirements in force appear to be based on a pre-2018 version of the Code, the most supportable assessment remains Not Adopted.

Current Status: Not Adopted

In accordance with Decree No. 526 of 2009, the General Directorate of Government Accounting (DIGECOG) has adopted the 2017 suite of accrual-basis International Public Sector Accounting Standards (IPSAS) as the national public sector accounting standards. According to the IFAC/CIPFA International Public Sector Financial Accountability Index, the Dominican Republic’s public sector accounting framework is based on accrual-basis IPSAS; however, the version currently in force appears to be the 2017 suite rather than the IPSAS in effect as of the time of the assessment.

Current Status: Partially Adopted

In accordance with Law No. 633 of 1944 and Decree No. 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.

ICPARD has established an Investigation, Qualifications and Ethics Committee and a Disciplinary Tribunal to carry out its I&D functions. These arrangements provide a legal and institutional framework for the investigation and discipline of its members.

However, based on publicly available information, it remains unclear whether ICPARD’s I&D system fully incorporates the requirements of Statement of Membership Obligation 6 (SMO 6), including the extent of alignment with international best practices relating to investigation, disciplinary procedures, appeals, public interest considerations, and liaison with other regulatory bodies. Accordingly, the most supportable assessment remains Partially Adopted.

Current Status: Partially Adopted

Under Law No. 479-08 of 2008, Law No. 633 of 1944, and Decree No. 2032 of 1984, the Instituto de Contadores Públicos Autorizados de la República Dominicana (ICPARD) is authorized to establish accounting standards for non-regulated entities. ICPARD has adopted the Spanish translations of International Financial Reporting Standards (IFRS Accounting Standards) since 1999 and the IFRS for Small and Medium-sized Entities (SMEs) Accounting Standard since 2014 without modification through ICPARD’s technical resolutions.

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

Companies supervised by the Superintendence of Banks (SB), the Superintendence of Pensions (SIPEN), and the Superintendence of Insurance (SIS) are not uniformly required to apply IFRS Accounting Standards. These regulators establish sector-specific reporting requirements that may override ICPARD-endorsed standards in cases of conflict. However, several banks in the jurisdiction are also listed entities and are therefore required to prepare financial statements in accordance with IFRS Accounting Standards.

Accordingly, while IFRS Accounting Standards are required for listed companies, they do not appear to be required for all domestic publicly accountable entities in the jurisdiction. The most supportable assessment therefore remains Partially Adopted.

Current Status: Partially Adopted

Relevant Organizations

• Central Bank of the Dominican Republic
• Instituto de Contadores Públicos Autorizados de la República Dominicana (ICPARD)
• Superintendence of Banks (SB)
• Superintendence of Securities (SIV) (now Superintendencia del Mercado de Valores / SIMV)
• Superintendence of Pensions (SIPEN)
• Superintendence of Insurance (SIS)

Relevant Legislation

• Decree No. 2032, 1984 (Internal Regulation for Chartered Public Accountants)
• General Law on Commercial Companies and Individual Limited Liability Enterprises No. 479-08, as amended by Law No. 31-11
• Law on Chartered Accountants No. 633, 1944
• Law on Insurance and Sureties of the Dominican Republic No. 146-02
• SB Resolution No. 1 – Reglamento de Auditores Externos, 2004
• Securities Market Law No. 19-00 (superseded by Law No. 249-17)
• SIPEN Resolution No. 8 – Sobre Registro de Auditores Externos, 2002
• SIV Circular C-SIV-2016-07-MV – Implementación del Nuevo Informe del Auditor Independiente, 2016
• SIV Resolution No. 1 – Norma para Auditores Externos que establece los Requisitos de Inscripción en el Registro del Mercado de Valores y Productos, 2005

Relevant Publications

• ICPARD, SMO Action Plan, April 2022.
• IFRS Foundation, “IFRS Application Around the World, Jurisdictional Profile: Dominican Republic,” June 2016.
• World Bank, Update of the Report on the Observance of Standards and Codes, Accounting and Auditing: Dominican Republic, August 2009.
• World Bank, Report on the Observance of Standards and Codes, Accounting and Auditing: Dominican Republic, December 2004.