Introduction to Accounting Standards and Norms

1. 📌 Essentials

• Normative evolution: mercantile → tax → EU adaptation → standards.
• Main norms: Ley 16/2007, Código de Comercio, RD 1514/2007, Ley 22/2015.
• Books of accounts: Diario + Inventories & Annual Accounts; legalize in Mercantile Registry.
• Formulation deadline: within 3 months after fiscal year-end.
• Financial statements: balance sheet, profit & loss, statement of changes in equity, cash flow, notes.
• Recognition criteria: probable future benefits and reliable measurement.
• Valuation methods: historical cost, fair value, net realizable value, present value.
• Core principles: accrual, consistency, prudence, materiality, no offsetting.
• Financial info must be prepared according to a codified chart of accounts.
• Financial statements are approved by the General Shareholders' Meeting and published in Mercantile Registry.
• Recognition of assets/liabilities occurs when benefits are probable and measurable.
• Income/expenses are recognized when realized or incurred.
• Inventory regularization at year-end ensures balance with physical stock.
• Inventory impairment must be recognized if net realizable value drops below cost.

2. 🧩 Key Structures & Components