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Uruguay

International Financial Reporting Standards

Summary
The Decree 162/2004 issued on May 12, 2004 made International Financial Reporting Standards (IFRSs), formerly International Accounting Standards, or IASs, issued by the International Accounting Standards Board (IASB) mandatory for use in Uruguay. According to Decree 90/2005 issued on February 25, 2005, IFRSs applicable in Uruguay are those that were approved by the IASB in effect as of May 19, 2004. Decree No. 266/07 issued on July 31, 2007 made mandatory adoption of IFRSs issued by the IASB effective for the fiscal year starting January 1, 2009.

    General Overview

    Decrees No. 162/2004, 222/2004 and 90/2005, issued on May 12, 2004, June 30, 2004 and February 25, 2005 respectively, have approved the mandatory use of IASs issued by the IASB in effect as of May 2004. (Decree Nº 266/07) On July 31, 2007 Decree 266 approved the mandatory adoption of IFRSs issued by IASB for the fiscal year starting January 1, 2009. For the fiscal years trough December 31st 2008, the application of IFRSs according to this decree or the application of Decrees No. 162/2004, 222/2004 and 90/2005 is optional. (Decree Nº 266/07)
    The IASs applicable in Uruguay are posted on the National Internal Audit (AIN) website. The standards published by the AIN are those translated by the Institute of Public Accountants of Mexico (Instituto Mexicano de Contadores Publicos), as of May 2004. (Decree No. 162/04; Decree No. 90/2005)
    On October 10, 2003, the Inter-American Development Bank (IDB) approved Project TC0304013: International Financial Reporting and Auditing Standards. The general objective of the project is to contribute to the supply of reliable, transparent and objective financial information on the financial performance of Uruguayan businesses that is comparable nationally and internationally. The specific objective is to achieve the timely and continuous adoption of IFRSs and International Standards on Auditing (ISAs) by developing processes for their proper application. As of 2006, the implementation of the project was in progress. (CCEA website; IADB as of 2006)
    The program consists of the following components: (1) research activities and development of an action plan for the convergence with IFRSs and ISAs as well as development of capacity for timely incorporation of revisions and issuance of new international standards; (2) raising public awareness activities and development of mechanisms for training activities: (3) optimization of the technical and ethical quality of professional practice: (4) developing legal foundation for the continuous adaptation of Uruguayan norms to IFRSs and ISAs. (CCEA website)
    Before the adoption of the Decree 162/2004, the following regulations governed accounting practice in Uruguay: Law No. 16.060, Resolution No. 90/91 of the Accounting Commission, Decree No. 103/91 on Uniform Financial Statements, Decree No. 105/91 and Decree No. 200/93 on Accounting Standards. The Decree No. 105/91 and the Decree No. 200/93 adopted with some exceptions the IASs, namely IAS 1 through IAS 18. As a result of publication of Decree No. 162/2004 issued on May 12, 2004, Decrees 105/1991 and 200/993 were revoked. For the financial years started before the publication of the Decree, there was an option of applying either the new standards or those established by Decrees 105/991 and 200/993. (Decree No. 162/2004; CCEA n.d.)
    Banks are required to follow the Central Bank of Uruguay (Banco Central del Uruguay, or BCU) Chart of Accounts which differs significantly from international accounting standards in the area of accounting for derivatives, labor benefits and taxes. As of 2006, the BCU hired consultants to bring the chart of accounts in line with international standards by the end of 2006, with the preliminary date of full adoption of IFRSs for application by banks being end-2008. (IMF 2006)
    The Association of Accountants and Economists of Uruguay is a member of the International Federation of Accountants (IFAC). (IFAC website)


    The Principles

    IFRS 1: First-time Adoption of International Financial Reporting Standards (effective 2006)

    Decrees No. 162/2004, 222/2004 and 90/2005, issued on May 12, 2004, June 30, 2004 and February 25, 2005 respectively, have approved the mandatory use of IASs issued by IASB in effect as of May 2004 and IFRS 1. (Decree Nº 266/07)

    On July 31, 2007 Decree 266 approved the mandatory adoption of IFRSs issued by IASB for the fiscal year starting January 1st 2009. For the fiscal years trough December 31st 2008, the application of IFRSs according to this decree or the application of Decrees No. 162/2004, 222/2004 and 90/2005 is optional. (Decree Nº 266/07)

    International Financial Reporting Standard (IFRS) 1 First-time Adoption of International Financial Reporting Standards was issued in June 2003 and applies to an entity whose first IFRS financial statements are for a period beginning on or after January 1, 2004. IFRS 1 also applies to each interim financial report, if any, that the entity presents under IAS 34 Interim Financial Reporting for part of the period covered by its first IFRS financial statements. (IASB website)

    IFRS 2: Share-based Payment (effective 2005)

    There is no equivalent standard in Uruguay as Uruguay adopted International Accounting Standards (IASs) that were effective as of January 1, 2003. (Decree No. 162/04)

    International Financial Reporting Standard (IFRS) 2 Share-based Payment was issued in February 2004 and applies to annual periods beginning on or after January 1, 2005. (IASB website)

    IFRS 3: Business Combinations (effective 2004)

    There is no equivalent standard in Uruguay as Uruguay adopted International Accounting Standards (IASs) that were effective as of January 1, 2003. (Decree No. 162/04)

    International Financial Reporting Standard (IFRS) 3 Business Combinations was issued in March 2004 and is applicable for business combinations for which the agreement date is on or after 31 March 2004. (IASB website)

    IFRS 4: Insurance Contracts (effective 2006)

    There is no equivalent standard in Uruguay as Uruguay adopted International Accounting Standards (IASs) that were effective as of January 1, 2003. (Decree No. 162/04)

    International Financial Reporting Standard (IFRS) 4 Insurance Contracts was issued in March 2004 and is applicable for annual periods beginning on or after January 1, 2005. (IASB website)

    IFRS 5: Non-current Assets Held for Sale and Discontinued Operations (effective 2005)

    There is no equivalent standard in Uruguay as Uruguay adopted International Accounting Standards (IASs) that were effective as of January 1, 2003. (Decree No. 162/04)

    International Financial Reporting Standard (IFRS) 5 Non-current Assets Held for Sale and Discontinued Operations was issued in March 2004 and is applicable for annual periods beginning on or after January 1, 2005. (IASB website)

    IFRS 6: Exploration for and Evaluation of Mineral Resources (effective 2006)

    There is no equivalent standard in Uruguay as Uruguay adopted International Accounting Standards (IASs) that were effective as of January 1, 2003. (Decree No. 162/04)

    IFRS 7: Financial Instruments: Disclosures (effective 2007)

    Uruguay adopted International Accounting Standards (IASs) that were effective as of January 1, 2003. (Decree No. 162/04) IAS 30 Disclosures in the Financial Statements of Banks and Similar Financial Institutions is applicable in the financial statements of banks and similar financial institutions for periods beginning on or after January 1, 1991. (IASB website)

    IAS 1: Presentation of Financial Statements (effective 2007)

    Uruguay adopted International Accounting Standards (IASs) that were effective as of January 1, 2003. (Decree No. 162/04) However, the International Accounting Standards Board (IASB) revised IAS 1 Presentation of Financial Statements in December 2003. The revised standard has been applicable for annual periods beginning on or after January 1, 2005. (IASB website)

    IAS 2: Inventories (effective 2005)

    Uruguay adopted International Accounting Standards (IASs) that were effective as of January 1, 2003. (Decree No. 162/04) However, the International Accounting Standards Board (IASB) revised IAS 2 Inventories in December 2003. The revised standard has been applicable to annual periods beginning on or after January 1, 2005. (IASB website)

    IAS 7: Cash Flow Statements (effective 1994)

    Uruguay adopted International Accounting Standards (IASs) that were effective as of January 1, 2003. (Decree No. 162/04) IAS 7 Cash Flow Statements (revised 1992) is applicable for periods beginning on or after January 1, 1994. (IASB website)

    IAS 8: Accounting Policies, Changes in Accounting Estimates and Errors (effective 2005)

    Uruguay adopted International Accounting Standards (IASs) that were effective as of January 1, 2003. (Decree No. 162/04) However, the International Accounting Standards Board (IASB) revised IAS 8 Accounting Policies, Changes in Accounting Estimates and Errors in December 2003. The revised standard has been effective for the periods commencing on January 1, 2005. (IASB website)

    IAS 10: Events after the Reporting Period (effective 2005)

    Uruguay adopted International Accounting Standards (IASs) that were effective as of January 1, 2003. (Decree No. 162/04) However, the International Accounting Standards Board (IASB) revised IAS 10 Events After the Balance Sheet Date in December 2003. The revised standard has been effective for the periods commencing on January 1, 2005. (IASB website)

    IAS 11: Construction Contracts (effective 1995)

    Uruguay adopted International Accounting Standards (IASs) that were effective as of January 1, 2003. (Decree No. 162/04) IAS 11 Construction Contracts is applicable for periods beginning on or after January 1, 1995. (IASB website)

    IAS 12: Income Taxes (effective 2001)

    Uruguay adopted International Accounting Standards (IASs) that were effective as of January 1, 2003. (Decree No. 162/04) IAS 12 Income Taxes is applicable for periods beginning on or after January 1, 1998. (IASB website)

    IAS 14: Segment Reporting (effective 1998)

    Uruguay adopted International Accounting Standards (IASs) that were effective as of January 1, 2003. (Decree No. 162/04) IAS 14 Segment Reporting is applicable for periods beginning on or after July 1, 1998. (IASB website)

    IAS 16: Property, Plant and Equipment (effective 2005)

    Uruguay adopted International Accounting Standards (IASs) that were effective as of January 1, 2003. (Decree No. 162/04) However, the International Accounting Standards Board (IASB) revised IAS 16 Property, Plant and Equipment in December 2003. The revised standard has been effective for the periods commencing on January 1, 2005. (IASB website)

    IAS 17: Leases (effective 2005)

    Uruguay adopted International Accounting Standards (IASs) that were effective as of January 1, 2003. (Decree No. 162/04) However, the International Accounting Standards Board (IASB) revised IAS 17 Leases in December 2003. The revised standard has been effective for the periods commencing on January 1, 2005. (IASB website)

    IAS 18: Revenue (effective 1995)

    Uruguay adopted International Accounting Standards (IASs) that were effective as of January 1, 2003. (Decree No. 162/04) IAS 18 Revenue is applicable for periods beginning on or after January 1, 1995. (IASB website)

    IAS 19: Employee Benefits (effective 2006)

    Uruguay adopted International Accounting Standards (IASs) that were effective as of January 1, 2003. (Decree No. 162/04) IAS 19 Employee Benefits is applicable for periods beginning on or after January 1, 1999. (IASB website)

    IAS 20: Accounting for Government Grants and Disclosure of Government Assistance (effective 1984)

    Uruguay adopted International Accounting Standards (IASs) that were effective as of January 1, 2003. (Decree No. 162/04) IAS 20 Accounting for Government Grants and Disclosure of Government Assistance is applicable for periods beginning on or after January 1, 1984. (IASB website)

    IAS 21: The Effects of Changes in Foreign Exchange Rates (effective 2005)

    Uruguay adopted International Accounting Standards (IASs) that were effective as of January 1, 2003. (Decree No. 162/04) However, the International Accounting Standards Board (IASB) revised IAS 21 The Effects of Changes in Foreign Exchange Rates in December 2003. The revised standard has been effective for the periods commencing on January 1, 2005. (IASB website)

    IAS 23: Borrowing Costs (effective 1995)

    Uruguay adopted International Accounting Standards (IASs) that were effective as of January 1, 2003. (Decree No. 162/04) IAS 23 Borrowing Costs is applicable for periods beginning on or after January 1, 1995. (IASB website)

    IAS 24: Related Party Disclosures (effective 2005)

    Uruguay adopted International Accounting Standards (IASs) that were effective as of January 1, 2003. (Decree No. 162/04) However, the International Accounting Standards Board (IASB) revised IAS 24 Related Party Disclosures in December 2003. The revised standard has been effective for the periods commencing on January 1, 2005. (IASB website)

    IAS 26: Accounting and Reporting by Retirement Benefit Plans (effective 1998)

    Uruguay adopted International Accounting Standards (IASs) that were effective as of January 1, 2003. (Decree No. 162/04) IAS 26 Accounting and Reporting by Retirement Benefit Plans is applicable for periods beginning on or after January 1, 1988. (IASB website)

    IAS 27: Consolidated and Separate Financial Statements (effective 2005)

    Uruguay adopted International Accounting Standards (IASs) that were effective as of January 1, 2003. (Decree No. 162/04) However, the International Accounting Standards Board (IASB) revised IAS 27 Consolidated and Separate Financial Statements in December 2003. The revised standard has been effective for the periods commencing on January 1, 2005. (IASB website)

    IAS 28: Investments in Associates (effective 2005)

    Uruguay adopted International Accounting Standards (IASs) that were effective as of January 1, 2003. (Decree No. 162/04) However, the International Accounting Standards Board (IASB) revised IAS 28 Investment in Associates in December 2003. The revised standard has been effective for the periods commencing on January 1, 2005. (IASB website)

    IAS 29: Financial Reporting in Hyperinflationary Economies (effective 1990)

    Uruguay adopted International Accounting Standards (IASs) that were effective as of January 1, 2003. (Decree No. 162/04) IAS 29 Financial Reporting in Hyperinflationary Economies is applicable for periods beginning on or after January 1, 1990. (IASB website)

    IAS 31: Interests in Joint Ventures (effective 2005)

    Uruguay adopted International Accounting Standards (IASs) that were effective as of January 1, 2003. (Decree No. 162/04) However, the International Accounting Standards Board (IASB) revised IAS 31 Interests in Joint Ventures in December 2003. The revised standard has been effective for the periods commencing on January 1, 2005. (IASB website)

    IAS 32: Financial Instruments: Disclosure and Presentation (effective 2005)

    Uruguay adopted International Accounting Standards (IASs) that were effective as of January 1, 2003. (Decree No. 162/04) However, the International Accounting Standards Board (IASB) revised IAS 32 Financial Instruments: Disclosure and Presentation in December 2003. The revised standard will be effective for the periods commencing on January 1, 2005. (IASB website)

    IAS 33: Earnings per Share (effective 2005)

    Uruguay adopted International Accounting Standards (IASs) that were effective as of January 1, 2003. (Decree No. 162/04) However, the International Accounting Standards Board (IASB) revised IAS 33 Earnings per Share in December 2003. The revised standard has been effective for the periods commencing on January 1, 2005. (IASB website)

    IAS 34: Interim Financial Reporting (effective 1999)

    Uruguay adopted International Accounting Standards (IASs) that were effective as of January 1, 2003. (Decree No. 162/04) IAS 34 Interim Financial Reporting is applicable for periods beginning on or after January 1, 1999. (IASB website)

    IAS 36: Impairment of Assets (effective 2004)

    Uruguay adopted International Accounting Standards (IASs) that were effective as of January 1, 2003. (Decree No. 162/04) However, the International Accounting Standards Board (IASB) revised IAS 36 Impairment of Assets in March 2004. It is applied to goodwill and intangible assets acquired in business combinations after 31 March 2004, and to all other assets for annual periods beginning on or after March 31, 2004. (IASB website)

    IAS 37: Provisions, Contingent Liabilities and Contingent Assets (effective 1999)

    Uruguay adopted International Accounting Standards (IASs) that were effective as of January 1, 2003. (Decree No. 162/04) IAS 37 Provisions, Contingent Liabilities and Contingent Assets was issued in July 1998 and is applicable for periods beginning on or after July 1, 1999. (IASB website)

    IAS 38: Intangible Assets (effective 2004)

    Uruguay adopted International Accounting Standards (IASs) that were effective as of January 1, 2003. (Decree No. 162/04) However, the International Accounting Standards Board (IASB) revised IAS 38 Intangible Assets in March 2004. The revised standard is applied to the accounting for intangible assets acquired in business combinations after March 31, 2004, and to all other intangible assets for annual periods beginning on or after March 31, 2004. (IASB website)

    IAS 39: Financial Instruments: Recognition and Measurement (effective 2006)

    Uruguay adopted International Accounting Standards (IASs) that were effective as of January 1, 2003. (Decree No. 162/04) However, the International Accounting Standards Board (IASB) revised IAS 39 Financial Instruments: Recognition and Measurement in December 2003. The revised standard will be effective for the periods commencing on January 1, 2005. (IASB website)

    IAS 40: Investment Property (effective 2005)

    Uruguay adopted International Accounting Standards (IASs) that were effective as of January 1, 2003. (Decree No. 162/04) However, the International Accounting Standards Board (IASB) revised IAS 40 Investment Property in December 2003. The revised standard has been effective for the periods commencing on January 1, 2005. (IASB website)

    IAS 41: Agriculture (effective 2003)

    Uruguay adopted International Accounting Standards (IASs) that were effective as of January 1, 2003. (Decree No. 162/04) IAS 41 Agriculture is applicable for periods beginning on or after January 1, 2003. (IASB website)

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    Sources of Assessment

    Association of Accountants, Economists and Business Administrators (CCEA), "Impact of Application of Decree 162/04 as a part of the Convergence Process to International Accounting Standards," n.d. Available from Association of Accountants, Economists and Business Administrators (CCEA) website. Accessed on November 9, 2006. (CCEA n.d.) (in Spanish only)

    International Monetary Fund, "Uruguay: Financial System Stability Assessment, including Reports on the Observance of Standards and Codes on the following topics: Banking Supervision and Payment Systems," Country Report No. 06/439, Washington, D.C.: IMF, December 14, 2006. Available from International Monetary Fund website. Accessed on March 10, 2007. (IMF 2006)

    Relevant Organizations

    Association of Accountants, Economists and Business Administrators of Uruguay - Colegio de Contadores Economistas y Administradores del Uruguay (CCEA) (in Spanish only)

    Central Bank of Uruguay - Banco Central del Uruguay (BCU)

    National Internal Audit - Auditoría Interna de la Nación (AIN) (in Spanish only)

    Permanent Commission of Adequate Accounting Standards - Comisión Permanente de Normas Contables Adecuadas (CPNCA) (in Spanish only)



    Relevant Legislation/Regulation

    Companies Law No. 16.060, 1989 - Ley de Sociedades Comerciales No. 16.060, 1989 (in Spanish only)

    Decrees on Accounting Standards - Decretos de Normas Contables (in Spanish only)

    Decree Approving the Adoption of IFRSs No. 266/2007, July 2007 - Decreto de Aprovacion de NIIFs No. 266/2007, Julio 2007 (in Spanish only)

    Decree Defining the Scope of International Accounting Standards No. 90, 2005 - Decreto que Define las Normas Internacionales de Contabilidad No. 90/05 (in Spanish only)

    Decree on Amendments to the Decree No. 162, 2004, No. 222, 2004 - Decreto de modificación del Decreto N° 162/004 de 12/05/2004, No. 222, 2004 (in Spanish only)

    Decree on Adoption of International Accounting Standards issued by International Accounting Standards Board No. 162, 2004 - Decreto donde se aprueba la aplicación de Normas emitidas por el Consejo de Normas Internacionales de Contabilidad (International Accounting Standards Board) No. 162, 2004 (Decree No. 162/04) (in Spanish only)

    Decree on Approving Application of International Accounting Standards 1, 2, 3, 4, 5, 6, 7, 8, 9, 10 as Mandatory Accounting Standards, (superseded by Decree No.162, 2004), No. 105, 1991 Decreto aprobando como normas contables adecuadas de aplicación obligatoria las Normas Internacionales de Contabilidad nros. 1, 2, 4, 5, 7, 8, 9 y 10, (derogado por Decreto 162/004), No. 105, 1991 (in Spanish only)

    Decree on Approving Application of International Accounting Standards 11, 12, 13, 14, 16, 17, 18 as Mandatory Accounting Standards (superseded by Decree No. 162, 2004), No. 200, 1993 - Decreto aprobando como normas contables adecuadas de aplicación obligatoria las Normas Internacionales de Contabilidad nros. 11, 12, 13, 14, 16, 17 Y 18, (derogado por Decreto 162/004), No. 200, 1993 (in Spanish only)



    Supplementary Sources

    International Federation of Accountants (IFAC) Member Bodies website. Accessed on September 25, 2006. (IFAC website)

    International Accounting Standards Board website. Accessed on September 25, 2006. (IASB website)

    Association of Accountants, Economists and Business Administrators of Uruguay (CCEA), "Assessment of the Regulatory and Standard-Setting Framework," Self-assessment prepared as a part of the International Federation of Accountants' (IFAC) Member Body Compliance Program, May 2006. Available from International Federation of Accountants' website. Accessed on November 9, 2006. (CCEA 2006)
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