Accounting and accounting rules in Thailand

Accounting Rules

Tax Year

The tax year generally is the 12-month period ending on 31 December. However, a company may choose any accounting period that does not exceed 12 months (a shorter year is allowed only in the year of incorporation, when there is a change of accounting method or in the year of dissolution). Once chosen, the accounting period cannot be changed unless written approval is obtained from the Revenue Department.

Accounting Standards

Thai Financial Reporting Standards (TFRS) are required to be applied in the preparation and presentation of financial statements of domestic publicly accountable entities. For non-publicly accountable entities (NPAEs), “TFRS for NPAEs” are required to be applied, but NPAEs can elect to apply TFRS. Both TFRS and TFRS for NPAEs are based on International Financial Reporting Standards (IFRS), however they do not include several options permitted by the IFRS as issued by the IASB. Foreign companies are permitted to use IFRS Standards. SMEs currently use either TFRS or TFRS for NPAEs, nonetheless the Federation of Accounting Professions is expected to fully adopt IFRS Standards for SMEs as from 1 January 2019.

Accounting Regulation Bodies

Federation of Accounting Professions of Thailand

Accounting Reports

Firms must keep books and follow accounting procedures specified in the Civil and Commercial Code, the Revenue Code and the Accounts Act. Documents may be prepared in any language, provided that a Thai translation is attached. Each company has to produce a balance sheet and a profit and loss account for each accounting year. The external control of accounts must be given to a body of auditors chosen by the company and by the commercial department of the ministry of Treasury.
Public limited companies must disclose the following information in their annual reports: company name, location of the head office, type of business, details of shares issued and shares held in subsidiaries (if any), details of directors regarding any conflict of interest in service contracts entered into by the company during each financial year and their shareholdings in the company or in subsidiaries and any changes during the year.

Publication Requirements

Each company has to produce a balance sheet and a profit and loss account for each accounting year.

A mid-year profit forecast entails advance payment of corporate taxes. On Annual Accounts, any newly-established company or partnership should close accounts within 12 months from the date of its registration. Thereafter, the accounts should be closed every 12 months. The performance record is to be certified by the company auditor, approved by shareholders, and filed with the Commercial Registration Department, Ministry of Commerce, within five months of the end of the fiscal year, and with the Revenue Department, Ministry of Finance, within 150 days of the end of the fiscal year. If a company wishes to change its accounting period, it must obtain written approval from the Director General of the Revenue Department.

Professional Accountancy Bodies

Certification and Auditing

The external control of accounts must be given to a body of auditors chosen by the company and by the commercial department of the ministry of Treasury.
The Thai Accounting Professions Act requires from certified public accountants (CPAs) who audit the financial statements of any entities that report to Thai regulators to apply the Thai Standards of Auditing and other Thai standards on review and other assurance engagements issued by the Federation of Accounting Professions.
For more information consult the following websites: Ernst & Young, Deloitte, KPMG, PriceWaterhouseCoopers.

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