Our site uses cookies to provide better service and a more personalized browsing experience.Accept cookiesLearn more

Madeira

Approved by Decree-Law no. 158/2009 dated July 13, the national model for accounting standards is characterized by its affinity to the accounting legislation implemented by the European Union (EU), associated to the International accounting standards (IAS) and International Financial Reporting Standards (IFRS) issued by the International accounting standards Board (IASB), while keeping some distinctive elements, such as, for example, a code of supplementary accounts.


The (SNC) accounting standards are mandatory for the following entities:

a) Companies comprised by the Companies Code (CSC);
b) Individual companies regulated by the Commercial Code;
c) Individual establishments of Limited Liability;
d) Public Companies;
e) Co-ops;
f) Joint Ventures and European Economic Interest Grouping.


The (SNC) accounting standards create three levels of structure for accounting standards:


Level 1 - Employing international accounting standards (IAS/IFRS) – as adopted by the European Union. As of 2005, companies listed in the Stock Exchange are obligated to use international accounting standards.

Aims:

  • The need for a universal accounting language implies that assets and liabilities are measured according to the same criteria;
  • Financial reporting rules should be uniform so that an investor can evaluate a company independently of its economic, financial or social context.


Level 2 - Employing accounting standards and financial reporting (NCRF) – national standards applicable to companies with a mitigated degree of disclosure, considering that their records are not targeted to investors in regulated markets. For all other companies, in other words, companies not listed, each country has produced their own set of norms, based on accounting and financial reporting standards. In Portugal these are designated by the acronym NCRF: Normas Contabilísticas e de Relato Financeiro (accounting standards Financial Reporting).

The following table provides the equivalences between the NCRF and IAS/IFRS:

ACCOUNTING AND FINANCIAL REPORTING STANDARDS N. IASB
NCRF 1 - Structure and Content of Financial Statements IAS 1
NCRF 2 - Statement of Cash Flows IAS 7
NCRF 3 - Adopting NCRF for the first time IFRS 1
NCRF 4 - Accounting Policies, Changes in Accounting Estimates and Errors IAS 8
NCRF 5 - Related Party Disclosures IAS 24 
NCRF 6 - Intangible Assets IAS 38
NCRF 7 - Fixed Tangible Assets IAS 16 
NCRF 8 - Non-current Assets Held for Sale and Discontinued Operations IFRS 5 
NCRF 9 - Leases IAS 17 
NCRF 10 - Borrowing Costs IAS 23 
NCRF 11 - Investment Property IAS 40
NCRF 12 - Impairment of Assets IAS 36 
NCRF 13 – Interests in Joint Ventures and Investment in Associates IAS 28 e 31 
NCRF 14 - Business Combination IFRS 3 
NCRF 15 - Investments in subsidiaries and Consolidation IAS 27
NCRF 16 - Exploration for and Evaluation of. Mineral Resources IFRS 6 
NCRF 17 - Agriculture IAS 41 
NCRF 18 -Inventory IAS 2 
NCRF 19 - Construction Contracts IAS 11 
NCRF 20 - Revenue IAS 18 
NCRF 21 - Provisions, Contingent Liabilities and Contingent Assets IAS 37 
NCRF 22 - Accounting for Government Grants and Disclosure of Government Assistance IAS 20 
NCRF 23 - Changes in Foreign Exchange Rate IAS 21 
NCRF 24 -  Events After the Reporting Period IAS 10 
NCRF 25 -  Income Taxes IAS 12 
NCRF 26 - Environmental Issues  
NCRF 27 -  Financial Instruments IAS 32+39+7
NCRF 28 -  Employee Benefits IAS 19 

 

Level 3 - (Simplified Regime) Employment of accounting standards and Financial Reporting for small entities (NCRF-PE) – standards which correspond to an even simpler application of NCRF. Level 3 contemplates Small Companies which do not exceed two of the following three limits:

  • €1.000.000 of total net sales and other income;
  • €500.000 total balance;
  • 20 employees (average number during reporting period).

However, these entities can choose to aply the NCRF above.

The standards for Accounting and financial reporting for small entities (NCRF-PE) encompass the main aspects of recognition, measuring and disclosure of the corresponding accounting standards and financial reporting (NCRF), with the exception of the following:

  • NCRF 2 – Statement of Cash Flows
  • NCRF 5 – Related Party Disclosures
  • NCRF 8 – Non-current Assets Held for Sale and Discontinued Operations
  • NCRF 11 – Investment Properties
  • NCRF 12 – Impairment of Assets
  • NCRF 13 – Interests in Joint Ventures and Investment in Associates
  • NCRF 14 – Business Combination
  • NCRF 15 – Investments in subsidiaries and Consolidation
  • NCRF 16 – Exploration for and Evaluation of Mineral Resources
  • NCRF 24 – Events After the Reporting Period


Code of Accounts

Approved by Ordinance no. 1011/2009 dated September 9, is an accounting instrument of mandatory use for entities subject to the (SNC) accounting standards, and may also be used by entities, which under the terms of article 4 of the referenced decree-law, employ the international standards of accounting, given the obvious benefits thereof for the comparison of financial demonstrations. The document does not intend to be exhaustive, containing, essentially, a summary table of accounts, the code for accounts (coded list of accounts) and notes for contextualization.

To review the above referenced Ordinance no. 1011/2009, follow this link (in Portuguese): Portaria_1011_2009_CC.pdf

If you wish to know more about the SNC – standard for accounting, contact us or consult the official site for the Commission for Standardized Accounting.

CONTACTS

Contact us to find out more about these advantages

 

Madeira
Tel.: +351 291 210 200               
Fax.: +351 291 210 209
info@newco.pro

Malta
Tel.: +356 21 223 120
Fax.: +356 21 223 119
info@newco.pro

Madrid
Tel.: +34 654 201 029
info@newco.pro

Lisboa
Tel.: +351 213 430 500
info@newco.pro

Talk to us