Microenterprises: Required to file financial statements

Micro-companies, unlike SMEs and large companies, must prepare abbreviated financial statements and are therefore obliged to submit fewer reports.

Here we tell you how the mandatory set of financial statements for micro-companies is composed.

Micro-companies in Colombia are classified in convergence group 3 and for this reason are not obliged to apply the International Financial Reporting Standards -IFRS-.

As it is known, micro-enterprises are small entities that develop few operations with a low level of complexity and therefore their accounting framework allows them to present abbreviated financial statements with less disclosure requirements.

Mandatory financial statements

Microenterprises, in accordance with paragraph 3.8 of Annex 3 of DUR 2420 of 2015, are only required to present at the end of each fiscal year, with cut-off as of December 31, the following financial statements:

Statement of financial position 2.

This report contains information about the assets, liabilities and equity of a microenterprise on a given date.

Its purpose is to present information about the entity’s resources and debts as of the reporting date.

Income Statement

This report shows the profit or loss of the microenterprise for a given period.

In this regard, the microenterprise should include information about its revenues, costs, and expenses.

Notes to the financial statements

The notes to the financial statements should include the information necessary for users to understand the reports.

Thus, the notes to the financial statements of microenterprises should contain information about the following aspects:

–Dataabout the economic entity.

–Summaryof the entity’s accounting policies.

– Quantitative and qualitativeinformationthat allows disaggregation of the items presented in the financial statements.

–Asummary of the movements in equity.

Source: Actualícese