Doing Business

Doing Business in Mexico 2015

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102 Tax and Legal Services - PwC Mexico purpose is to ensure greater comparability among the financial statements of listed companies, either eliminate certain options available under Mexican Financial Reporting Standards or require that all listed companies adopt a newly promulgated reporting standard in the same calendar year. The IMCP is a member of the International Accounting Standards Committee (IASC), and MFRS are generally in compliance with IASC and IFRS standards. IFRS must be applied in Mexico in areas not covered by existing Mexican accounting standards. Financial institutions, stockbrokers and insurance companies are required to prepare their financial statements in accordance with accounting practices prescribed by the appropriate regulatory agency. These practices differ in some respects from MFRS. Mexican Financial Reporting Standards issued by the CINIF and Changes in Mexican Financial Reporting Standards and Improvements to MFRS 2014 are observed in Appendix X. Form and content of financial statements The following basic financial statements, usually covering two years, are included with reports of public accountants. • Statement of the Financial Position • Comprehensive Statement income (presentation on a single financial statement) or integrated Statements of Income and Other Comprehensive Income (presentation in two statements). • Statement of changes in stockholders' equity. • Statement of cash flows. • Notes A typical set of financial statements for a subsidiary of a foreign company is included in Appendix XIII. Mexican company law requires that the above statements and notes, together with the statutory auditor's report (in the case of a private company) and management's report on the company's operations, be presented at the annual stockholders' meeting. In the case of a listed company, the independent auditors' report and the report of the Audit Committee would be presented instead of the statutory auditor's report. Each stockholder has the right to receive a copy. Listed companies must publish their annual financial statements and notes, but not management's report on operations, in a major newspaper. However, unlisted companies are not required to publish their financial statements or otherwise make them available for public inspection. Income statement The comprehensive statement income should show at a minimum, if applicable, the line items of net sales or revenues, costs and expenses, comprehensive financing result, income taxes, discontinued operations and other comprehensive net income.

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