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Macao Overhauls Financial Crime Reporting Requirements

The Macao Special Administrative Region has introduced new regulations to strengthen financial reporting standards, effective March 28, 2020. The overhaul aims to enhance the relevancy of financial reports in economic decision-making and meet the demands from economic development.

New Financial Reporting Standards (FRS)

The new FRS, approved by Order No.44/2020, have replaced the existing FRS, Annex II of Administrative Regulation No.25/2005. The new standards have expanded scope, adopting all 41 International Financial Reporting Standards (IFRS) from the 2015 edition.

Key Changes

Expanded Scope: Covers significant transactions and events regarding consolidated financial statements, financial instruments, employee benefits, disclosure of related parties, and investment real estate.
Convergence with IFRS: Aims to realize convergence with IFRS, enhancing the relevancy of financial reports in economic decision-making and meeting the demands from economic development.

Entities Subject to the New Standards

The following entities are subject to the new standards:

Concessionary entities in Macao
Insurance companies
Institutions governed by the Financial System Act
Offshore companies
Public companies
Partnerships limited by shares
Supplementary Tax on Income - Group A taxpayers
Professional Tax - Group 2 taxpayers

Transitional Provisions

Applicable entities can apply the New FRS as of January 1, 2022. The original FRS may be applied to financial reports of prior periods.

Seeking Professional Advice

Entities are advised to seek professional advice from auditors or accountants to ensure compliance with the new regulations.

For Further Information

Please refer to both Administrative Regulation No.25/2005 and Order No.44/2020 (Government Printing Bureau website: www.io.gov.mo).