Books
and records
Proper books and records of the
financial affairs of all entities doing business
in Puerto Rico must be maintained in Puerto Rico.
In practice, this requirement has not, to date,
precluded the processing of transactions at
another location, but on a reasonably timely
basis all accounting records and supporting
documents should be available for inspection in
Puerto Rico, either at the entity's office or at
the office of its registered representative on
the island.
Audited financial statements
Statutory audit reports are
required for domestic and foreign corporations
(and in rare instances for partnerships and
individuals). The independent public accountants
engaged by management to render an opinion on the
financial statements of the corporation also
perform the necessary work to render required
statutory reports. The government accepts a
"regular" opinion audit as satisfying
the statutory audit requirement if it is done by
a CPA licensed in Puerto Rico.
Statutory audit reports are
required for domestic and foreign corporations as
follows, to accompany the following documents
(generally if business gross revenue is over
$1M).
Accounting Profession
Public accounting in Puerto Rico
is practiced, in all material respects, in the
same manner as in the United States. Puerto Rico
regards the American Institute of Certified
Public Accountants (AICPA) and the Financial
Accounting Standards Board (FASB) as the primary
professional rule-making bodies. Accordingly,
generally accepted accounting principles (GAAP)
and generally accepted auditing standards (GAAS)
in the United States are recognized as the basis
for the preparation and audit of financial
statements.
The Puerto Rico Board of
Accounting is the government's authority which
governs the practice of CPA's in Puerto Rico. The
'Colegio de Contadores Públicos Autorizados de
Puerto Rico' (College of Certified Public
Accountants of Puerto Rico) is the professional
organization similar to a State Society in the
United States. An individual is certified by the
Board as a CPA and thereafter may join the
College. However, in order to practice the
profession, one must receive a valid license from
the Board and also must be a member of the
College.
Many CPA's licensed in Puerto
Rico are members of the AICPA. Only individuals
who pass the Uniform AICPA examination may be
licensed as Puerto Rico CPA's.
Auditing Standards
Auditing standards in Puerto Rico
are based entirely on those prescribed in the
United States by the American Institute of
Certified Public Accountants.
A typical auditor's report in
Puerto Rico is written exactly as one would be
written in the United States. It is not
considered necessary, nor is it typical, to state
in reports in Puerto Rico that accounting
principles and auditing standards generally
accepted in the United States have been employed.
Accounting Principles
No separate accounting principles
are employed for Puerto Rico. The accounting
principles prescribed for financial statements
are the same as those prescribed in the United
States by the Financial Accounting Standards
Board (FASB) and predecessor Boards of the AICPA.
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