CIRCULAR N° 002 /MINFI/DGI/LC/L OF 31 JANUARY 2012 SPECIFYING THE TERMS OF APPLICATION OF DECREE NO. 2011/0975/PM OF 04 APRIL 2011 SETTING THE TERMS OF REVALUATION OF DEPRECIABLE AND NON-DEPRECIABLE FIXED ASSETS OF COMPANIES
THE DIRECTOR GENERAL
To
- The Head of the National Inspectorate of Services;
- The Division Heads;
- The Heads of the Regional Tax Centres;
- The Deputy Directors and equivalent;
- The Department Heads and equivalent;
The 2010 Finance Law instituted the legal revaluation of capital assets to allow companies to present balance sheets that reflect the economic reality of the moment. Some of the provisions of this system were amended in the 2011 Finance Law, and its purpose is also to improve the financial information of companies with a view to strengthening their borrowing capacity. Finally, this revaluation is a real tool to foster investment.
The terms and conditions of application of this revaluation are laid out in Decree No. 2011/0975/PM of 4 April 2011.
This circular, which provides useful details for the effective implementation of this mechanism, is structured around themes such as the scope of the revaluation, the terms and conditions of its implementation, the handling of the revaluation difference, as well as disclosure requirements and the applicable sanctions regime, if any.
I - THE SCOPE OF LEGAL REVALUATION
A- Persons automatically subject to revaluation (Articles 2, 3 and 5)
Natural or legal persons meeting the following cumulative criteria are automatically subject to the legal revaluation of tangible and intangible capital assets:
- fall under the actual tax regime and have generated a turnover greater than or equal to one hundred million CFA francs as of 31 December 2010 or during the two previous financial years:
Individuals or legal entities whose annual turnover excluding VAT is greater than or equal to fifty million (50,000,000) CFA francs must be considered as falling under the actual tax scheme.
However, in addition to being subject to the actual tax scheme, the persons concerned must have generated a turnover excluding VAT of at least CFA F 100 million for the 2010 financial year or during the 2009 or 2008 financial years. For the assessment of this criterion, you shall refer to the turnover retained for the calculation of the license fee or, if necessary, to the turnover reconstituted during an audit of documents, a spot check or an accounting audit, whether partial or general;
- Be engaged in an industrial, commercial, agricultural, real estate, mining or craft activity, or a liberal profession in Cameroon:
Persons subject to the obligation to revalue their fixed assets must fall within one of the sectors of activity mentioned above. From this enumeration, it should be noted that only natural or legal persons exercising a profit-making activity are covered. Sole proprietorships, commercial companies, including companies with public capital or semi-public companies are therefore included in the scope of the revaluation;