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What Is Statutory Audit in Colombia and Why Is It Essential for Your Subsidiary?

Servicios WTC Revisoria Fiscal Bogota Colombia enero 16, 2025

Introduction:

If your foreign company plans to establish a subsidiary in Colombia and meets the legal requirements, you will likely need to appoint a Statutory Auditor known as Revisor Fiscal. This mandatory role, regulated by the Commercial Code and related legislation, ensures transparency, regulatory compliance, and strengthens the subsidiary’s corporate governance.

In this article, we explain the features, scope, relevance, and key obligations of the Statutory Auditor, as well as its strategic value for companies operating in Colombia.

What Is Statutory Audit Revisoría Fiscal

Statutory Audit, or Revisoría Fiscal, is a mandatory function for certain companies in Colombia, as established by the Commercial Code and Law 43 of 1990. It is performed by a certified public accountant Contador Público who operates independently to:

  • Ensure compliance with legal and statutory regulations
  • Verify adherence to accounting and financial standards
  • Promote transparency and ethical practices within the organisation

The Statutory Auditor is appointed by the Shareholders Meeting or the Board of Partners, ensuring their independence and impartiality in overseeing the company’s operations.

Who Is Required to Appoint a Statutory Auditor in 2025

According to paragraph 2 Article 13 of Law 43 of 1990, entities are required to appoint a Statutory Auditor if they meet one or both of the following thresholds by 31 December 2024:

  • Total assets equal to or exceeding COP 6.500.000.000      (CLMMW  5000 x COP 1.300.000)   Current Legal Monthly Minimum Wage  2024
  • Gross income equal to or exceeding COP 3.900.000.000   (CLMMW 3000 x COP 1.300.000)   Current Legal Monthly Minimum Wage  2024

Foreign companies establishing subsidiaries in Colombia should carefully review these criteria, as non-compliance can result in penalties and operational risks.

Key Features of Statutory Audit

  1. Mandatory by Law:
    Companies meeting the above thresholds are legally required to appoint a Statutory Auditor, ensuring alignment with Colombian regulations

  2. Comprehensive Oversight:
    The Statutory Auditor monitors financial statements, compliance with formal duties, and the implementation of internal controls

  3. Professional Independence:
    The Statutory Auditor operates independently, ensuring that their judgement and discretion remain unbiased and unaffected by contractual pressures or management influence

Scope of Statutory Audit

  1. Financial Assessment:
    Reviews financial statements to confirm compliance with International Financial Reporting Standards IFRS

  2. Regulatory Compliance:
    Verifies adherence to formal duties related to taxation, labour, and corporate governance in accordance with Colombian law

  3. Internal Controls Analysis:
    Identifies operational risks and recommends corrective actions to enhance internal processes

  4. Strategic Reporting:
    Provides clear and objective reports to the shareholders or partners, offering insights into the company’s financial and operational health

Relevance for Corporate Governance

Appointing a Statutory Auditor plays a critical role in strengthening a company’s corporate governance, particularly for subsidiaries of foreign firms. Key benefits include:

  • Financial Transparency:
    Ensures reliable information for stakeholders

  • Regulatory Compliance:
    Minimises the risk of penalties and reputational damage by meeting Colombian legal standards

  • Risk Management:
    Identifies and mitigates operational and strategic risks

  • Ethical Leadership:
    Encourages a corporate culture aligned with international best practices in transparency and responsibility

Conclusion:

The Statutory Audit in Colombia is a cornerstone of transparency and compliance. For foreign companies planning to operate in the country, this role not only ensures adherence to local regulations but also strengthens their subsidiary’s corporate governance and enhances stakeholder confidence

At WIN THE CHALLENGE®,we are committed to performing this role with professional independence, critical judgement, and a focus on ethics and integrity, ensuring our clients operate with the highest standards of accountability

Ready to establish your operations in Colombia with solid corporate governance Let us help you navigate the process with confidence. Contact Us: confianza@wtcadvisor.com