Thailand

Financial reporting requirements in Thailand are outlined in several laws, which include the Accounting Act B.E. 2543 of 2000, the Securities and Exchange Act B.E. 2535 of 1992, the Bank of Thailand Act B.E. 2485, the Financial Institutions Business Act B.E. 2551, and the Insurance Commission Act B.E. 2550.

Accounting

Under the Accounting Professions Act B.E. 2547 of 2004, financial statements for Publicly Accountable Entities (PAEs) must be completed in accordance with Thai Financial Reporting Standards (TFRS):

• entities whose equity or debt instruments are traded in a public market (a domestic or foreign stock exchange or an over-the-counter market, including local and regional markets) or that files, or are in the process of filing their financial statements with a securities commission or other regulatory organization for the purpose of issuing securities in a public market;
• entities whose operation is mainly holding assets in a fiduciary capacity for a broad group of outsiders, such as financial institutions, insurance companies, securities companies, mutual funds, agricultural futures market, in accordance with relevant laws; and
• public companies under Public Company Act.

TFRS are IFRS translated into Thai with a one-year delay from the equivalent IFRS Standard’s effective date, with the exception of standards relating to financial instruments and first-time adoption of IFRS.

Non-PAEs, which may include SMEs, can use either (a) Thai Financial Reporting Standards (TFRSs) or (b) the Thai Financial Reporting Standard for Non-Publicly Accountable Entities (NPAEs). TFAC is in the process of revising the accounting standard for NPAEs in other areas in addition to Property, Plant, and Equipment and Investment Property (for example consolidated financial statements and share-based payment).

The Federation of Accounting Professions (TFAC) is responsible for developing and issuing accounting standards in Thailand; however, all standards are ultimately approved by the Accounting Professions Regulatory Commission and published in the Royal Gazette.

Auditing

PAEs must be audited by a certified public auditor in accordance with the Thai Standards on Auditing (TSA). Registered partnerships whose total revenue, assets, and registered capital fall below a certain threshold are not required to be audited. The TFAC’s Auditing Profession Committee develops the TSA, which are in accordance with the latest version of International Standards on Auditing issued by the International Auditing and Assurance Standards Board.

The Securities and Exchange Commission (SEC), the Bank of Thailand (BoT), and the Office of Insurance Commission are the supervisory agencies that regulate the Thai capital market; all financial institutions including commercial banks, finance companies, and credit companies; and insurance companies, respectively. All entities regulated by these agencies must apply the TFRS and statements are to be audited using the TSA.

In Thailand, professional accountants are defined as individuals who provide services in bookkeeping, auditing, managerial accounting, accounting system design, tax accounting, accounting education and technology, or other accounting services prescribed by the ministerial regulations.

According to the Accounting Professions Act B.E. 2547 of 2004, the Federation of Accounting Profession (TFAC) is responsible for regulating the accountancy profession under oversight from the Accounting Professions Regulatory Commission (APRC).

The responsibilities of the TFAC include: (i) establishing initial professional development (IPD) and continuing professional development requirements for the accountancy profession; (ii) setting accounting and auditing standards; (d) establishing ethical requirements for professional accountants and monitoring the behavior and operation of registered members in accordance with professional ethics, such as establishing an investigative and disciplinary (I&D) mechanism; (iii) issuing, suspending, and revoking professional accountants registration and license; (iv) certifying accounting degrees or certificates; (v) certifying the training curriculum for professional accountants; (vi) issuing the Certified Public Accountant designation; (vii) providing advice and recommendations to the government regarding policies and issues related the accounting profession; (viii) issuing the regulations of the TFAC; (ix) establishing a quality assurance (QA) review mechanism for members; and (x) acting as the representative of the accounting profession.

The APRC, established under the Accounting Professions Act, is responsible for (i) supervising the functions and activities of the TFAC; (ii) approving the regulations of the TFAC and accounting standards as adopted by the TFAC; and (iii) considering appeals by TFAC members against disciplinary measures by the Professional Ethics Committee.

Licensing requirements for both certified public accountants and bookkeepers are set out in the Accounting Professions Act, which requires both categories of professional accountants to register and be members of the TFAC. According to the Professional Act, all Certified Public Accountant (CPA) candidates are required to have a bachelor’s degree in accounting (or equivalent) from one of the approved universities; satisfy practical experience requirements (verified by the TFAC sub-committee on CPA qualification); and successfully pass six examinations administered by TFAC.

In addition, under the Securities and Exchange Act B.E. 2535 of 1992, the Securities and Exchange Commission (SEC) has direct responsibility for the supervision of the auditors of securities issuers and entities under SEC supervision. The SEC will monitor these auditors and their work. The SEC performs QA reviews of audit firms and ensures that accounting and auditing standards are applied. In addition, it has also set up an Auditor Disciplinary Steering Group to ensure sharing of information and fair assessment of auditor’s performance.

Established under the Securities and Exchange Act B.E. 2535 of 1992 as an independent public agency, the Securities and Exchange Commission (SEC) has direct responsibility for supervision of the auditors of securities issuers and entities under SEC supervision (listed companies, brokers, dealers, asset management companies and collective investment schemes), and carries out the regulation and monitoring of auditors and their work. The SEC supervises and monitors audit firms’ quality control / management systems and ensures that accounting and auditing standards are applied. In addition, the Central Bank of Thailand requires that auditors of all banks, financial institutions, and insurance companies must be those approved by the SEC as auditors in the capital market. The SEC is a member of the International Forum of Independent Audit Regulators.

Auditors of other entities are regulated by the Federation of Accounting Professions (TFAC) under the oversight of Accounting Professions Regulatory Commission as described in the Regulation section.

Federation of Accounting Professions (TFAC)

The Accountant Association of Thailand was originally established in 1948, and has since be renamed to the Federation of Accounting Professions (TFAC) as of 2004. The TFAC has been under the Royal Patronage of His Majesty the King since September 6, 2005.

Under the Accounting Professions Act B.E. 2547 of 2004, the TFAC is responsible for regulating the accountancy profession under oversight from the Accounting Professions Regulatory Commission. The TFAC unites all professional accountants as membership is mandatory. Its responsibilities include: (i) establishing initial professional development (IPD) and continuing professional development requirements for the accountancy profession; (ii) setting accounting and auditing standards; (d) establishing ethical requirements for professional accountants and monitoring the behavior and operation of registered members in accordance with professional ethics, such as establishing an investigative and disciplinary (I&D) mechanism; (iii) issuing, suspending, and revoking professional accountants registration and license; (iv) certifying accounting degrees or certificates; (v) certifying the training curriculum for professional accountants; (vi) issuing the Certified Public Accountant designation; (vii) providing advice and recommendations to the government regarding policies and issues related the accounting profession; (viii) issuing the regulations of the TFAC; (ix) establishing a quality assurance (QA) review mechanism for members; and (x) acting as the representative of the accounting profession.

In addition to being a Member of IFAC, the TFAC is also a member of the ASEAN Federation of Accountants.

The Federation of Accounting Professions (TFAC) and the Securities and Exchange Commission (SEC) both operate separate quality assurance (QA) review systems in Thailand.

Since 2012, TFAC has been conducting QA reviews through its Audit Quality Oversight Subcommittee (AQOS). The committee’s responsibilities include educating and monitoring auditors and firms on the implementation of Thai Standard on Quality Control (TSQC 1), which is a direct translation of ISQC 1, and supervising the QA team in ensuring that auditors and firm maintain quality control systems. In June 2017, the AQOS completed its three-year term, and the TFAC reports that as of the date of the assessment, the establishment of a new committee is currently in progress. The TFAC conducted an assessment of its QA system against the requirements of SMO 1 and identified that its system does not adopt a cycle-based approach, there is a lack of human resources available to conduct QA reviews, and the system is not linked to its I&D mechanisms.

Under the Securities and Exchange Act of 1992, the SEC is responsible for regulating and supervising auditors of listed companies, brokers, dealers, asset management companies and collective investment schemes, banks, financial institutions, and insurance companies. Audit firms in Thailand are inspected to ensure that appropriate controls are in place and are required to implement TSQC 1. The SEC is also responsible for inspecting the engagement files of the auditors to ensure that they comply with relevant standards set by the TFAC. It is unclear if the QA system established by the SEC meets the best practices of SMO 1.

The TFAC reports that although there are two QA review systems, it collaborates with the SEC to ensure there are no duplication of reviews.

Regarding relevant standards (ISQM), TFAC reports that ISQM 1 is effective for auditors and firms for companies under the remit of the SEC. For all others, the effective date is December 15, 2023.

Current Status: Partially Adopted

The Accounting Professions Act B.E. 2547 of 2004 authorizes the Federation of Accounting Professions (TFAC) to establish initial professional development and continuing professional development requirements and programs for professional accountants in Thailand.

According to the Professional Act, all Certified Public Accountant (CPA) candidates are required to have a bachelor’s degree in accounting (or equivalent) from one of the approved universities; satisfy practical experience requirements (verified by the TFAC sub-committee on CPA qualification); and successfully pass six examinations administered by TFAC. TFAC is responsible for certifying the training curriculum for all professional accountants in the jurisdiction.

Licensing requirements for bookkeepers are also set out in the Accounting Professions Act and they must register and be members of the TFAC. To qualify as a bookkeeper in Thailand, one must adhere to the specific criteria and conditions as stipulated in the announcement by the Department of Business Development on qualifications for bookkeepers, according to B.E. 2557 and its amendment (No.2) B.E. 2559. The key requirements include having residence in Thailand, sufficient knowledge of the Thai language, adherence to legal and ethical standards, should never have been sentenced to imprisonment for any offense specified in Section 39 (3) of the Accounting Act B.E. 2547, unless the sentence was completed at least three years prior, and must possess a minimum of a bachelor's degree or Higher Professional Diploma in Accounting or equivalent. Additionally, bookkeepers must be a member of or registered with the Federation of Accounting Professions as mandated by the Accounting Act B.E. 2547. This membership must be renewed every year and complete at least 12 hours of training annually.

Once qualified, TFAC members must maintain their membership status by completing 120 hours of CPD per triennium.

The TFAC reports it has translated and incorporated the 2019 IES requirements into its educational programming.

Current Status: Adopted

Under the Accounting Professions Act B.E. 2547 of 2004, the Federation of Accounting Profession (TFAC) has direct responsibility for establishing auditing standards. The TFAC reports that it has established an ongoing process to review, translate, and adopt new and revised pronouncements of IAASB. The 2020 IAASB Handbook have been translated and adopted as the Thai Standards on Auditing. TFAC reports that it plans to adopt 2021 IAASB Handbook by the end of 2023.

Current Status: Partially Adopted

The Accounting Professions Act B.E. 2547 of 2004 authorizes the Federation of Accounting Profession (TFAC) to set ethical requirements. TFAC has implemented a continuous procedure for assessing, translating, and adopting the IESBA Code of Ethics. The 2020 International Code of Ethics issued by the IESBA has been translated and adopted. Presently, efforts are underway to adopt the 2022 International Code of Ethics.

Current Status: Partially Adopted

Under the Ministry of Finance’s Regulation of the Ministerial Division Comptroller B.E. 2557, the Comptroller General’s Department (CGD) is responsible for setting public sector accounting standards in Thailand.

Since 2018, CGD has issued several Thai Public Sector Accounting Standards and Policies (TPSAS), which are national standards that reference IPSAS and are on a partial-accrual basis.

Current Status: Partially Adopted

In Thailand, the Federation of Accounting Professions (TFAC), the Securities and Exchange Commission (SEC), and the Accounting Professions Regulatory Commission (APRC) share responsibility in the investigative and disciplinary (I&D) process for professional accountants in Thailand.

The Accounting Professions Act B.E. 2547 of 2004 sets out the penalties that can be imposed on professional accountants as well as the overall I&D process. The Act authorizes the TFAC’s Committee on Professional Ethics to oversee the operation of the I&D system, and the responsibilities of the committee include issuing warnings, probations, and suspensions, and removing licenses and registrations. The Act, however, prohibits the TFAC from imposing certain penalties such as issuing fines and ordering further trainings. Appeals by TFAC members can be made to the APRC, which was developed to act as an oversight body of the TFAC.

The TFAC conducted an assessment of its I&D system against the requirements of SMO 6 and identified two gaps due to the new Personal Data Protection Acts (PDPA) which became effective in 2022. As a result, efforts are currently underway to revise the procedures for public disclosure to align them with requirements of the law.

Under the Securities and Exchange Act B.E. 2535 of 1992, the SEC has direct responsibility for the supervision of the auditors of listed companies, brokers, dealers, asset management companies and collective investment schemes, banks, financial institutions, and insurance companies. The SEC has set up an Auditor Disciplinary Steering Group to ensure sharing of information and fair assessment of auditor’s performance. The group is also responsible for – proposing sanctions on auditors who fail to comply with relevant rules and regulations. It is unclear if the I&D system established by the SEC meets the best practices of SMO 6.

Current Status: Partially Adopted

Under the Accounting Professions Act B.E. 2547 of 2004, financial statements for Publicly Accountable Entities (PAEs) must be completed in accordance with Thai Financial Reporting Standards (TFRS):

• entities whose equity or debt instruments are traded in a public market (a domestic or foreign stock exchange or an over-the-counter market, including local and regional markets) or that files, or are in the process of filing their financial statements with a securities commission or other regulatory organization for the purpose of issuing securities in a public market;
• entities whose operation is mainly holding assets in a fiduciary capacity for a broad group of outsiders, such as financial institutions, insurance companies, securities companies, mutual funds, agricultural futures market, in accordance with relevant laws; and
• public companies under Public Company Act.

TFRS are IFRS translated into Thai with a one-year delay from the equivalent IFRS Standard’s effective date, with the exception of standards relating to financial instruments and first-time adoption of IFRS. The TFAC reports that TFRS are currently based on the 2022 version of IFRS.

Non-PAEs, which may include SMEs, can use either (a) Thai Financial Reporting Standards (TFRSs) or (b) the Thai Financial Reporting Standard for Non-Publicly Accountable Entities (NPAEs). TFAC is in the process of revising the accounting standard for NPAEs in other areas in addition to Property, Plant, and Equipment and Investment Property (for example consolidated financial statements and share-based payment).

The Federation of Accounting Professions (TFAC) is responsible for developing and issuing accounting standards in Thailand; however, all standards are ultimately approved by the Accounting Professions Regulatory Commission and published in the Royal Gazette.

Current Status: Partially Adopted

Relevant Organizations

• Federation of Accounting Professions (TFAC)
• Securities and Exchange Commission (SEC)

Relevant Legislation

• Accounting Act B.E. 2543
• Accounting Professions Act B.E. 2547

Relevant Publications

• IFIAR, Member Profile: Kingdom of Thailand.
• IFRS Foundation, “IFRS Application Around the World, Jurisdictional Profile: Thailand,” November 2021
• Mazars, “New and Revised Thailand Standards on Auditing,” March 2016.
• Mazars, “Thai Financial Reporting Standards for Non-Publicly Accountable Entities,” August 2011.
• TFAC, SMO Action Plan, 2023.
• World Bank, Report on the Observance of Standards and Codes (ROSC) AA, Kingdom of Thailand, 2008.
• World Bank, “Current Status of the Accounting and Auditing Profession in ASEAN Countries,” September 2014.