5. Financial Transparency
5.1 Market Stability
5.2 Independent Asset Valuers
5.3 Data Standards
In-Country Assessment Information

5. Financial Transparency

Goal – A well developed and transparent financial system that includes strong supporting institutions and highly trained and ethical professionals that contribute to effective financial intermediation and deep and broad access to capital and financial services


5.1 Market Stability (Weak)

Core Question:  Are market risks sufficiently transparent and diversified so that efficient capital allocation can occur?

Honduras has weak auditing standards and the risk of insolvency for lenders is high. Bankruptcy proceedings are also difficult to manage.

5.1.1 Financial Reporting (Weak)

What is the strength of the country’s auditing and reporting standards?

Ranked 75 out of 148; Score 4.59 out of 7.

Financial reporting by Honduran companies is governed by Honduran Law under Ley sobre Normas de Contabilidad y de Auditoría (A&A Law). The enactment of the A&A Law represents an important step toward improving Honduras’ financial reporting and auditing practices. However, the law also has a number of weaknesses that need to be addressed in order to facilitate effective implementation. For instance, the scope of the A&A Law is too broad, and its requirements apply to both public and private sector entities, without clarifying what parts of the public sector would be governed by the law.

5.1.2 Financial Services (Strong)

Does the financial sector provide a wide variety of financial services to businesses?

Ranked 46 out of 148; Score 4.98 out of 7.

Source: The Global Competitiveness Report 2013-214, World Economic Forum


5.1.3 Insolvency Process (Weak)

Ranked 136 out of 188; Trend ↓ What is the average time to complete bankruptcy proceedings?

2.8 years What is the cost of bankruptcy proceedings as a percentage of the estate?

15%  What is the recovery rate of bankruptcy proceedings?

19.5 cents on the dollar

Source: Doing Business 2014 – Closing a Business


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5.2 Independent Asset Valuers (Very Weak)

Core Question: Do trained, independent and ethical asset valuers exist for all types of assets?

The government of Honduras has not implemented any certification, licensing, or standards for valuation of real property and no profession for valuation exists. As a result, lawyers are involved in real estate transactions frequently and slow down the transfer of ownership.

Survey Questions

5.2.1 Standards (Very Weak)

SQ 17  How easy is it to find a valuer who implements International Valuation Standards?

Research could not identify any appraisers who implement the International Valuation Standards.

Civil Society Resource: International Valuation Standards Council

5.2.2 Training (Very Weak)

SQ 18  What is the level of training of valuers?

There is no separate profession for valuation.

Civil Society Resource:

5.2.3 Ethics (Very Weak)

SQ 19  Are opinions offered by valuers free of influence from parties to the transaction?

There is no separate profession for valuation.


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5.3 Data Standards (Strong)

Core Question: Is accurate property information available electronically in formats that are consistent with international standards?

Although the building codes are in its infancy, Honduras uses MLS systems that efficiently transmit listing data and property information for investors abroad.

Survey Questions

5.3.1 Sales & Operating Data

SQ 20  A multiple listing service is an electronic exchange system where brokers and agents can widely share contracted real estate listings of properties that are for sale. Do multiple listing type services exist?

Honduras utilizes an MLS system through Roatán REALTORS Association.

Source: Roatán REALTORS Association

SQ 21  Do resources exist for obtaining building income and expense estimates?


Source: Roatán REALTORS Association

5.3.2 Interchange Formats (Strong)

SQ 22  Do electronic data interchange formats conform to international standards (ebXML – electronic business using extensive markup language)?

Roatán MLS uses “FLEXMLS” SOFTWARE ( It ensures that the property’s information is accessible to those looking to invest in The Bay Islands.

5.3.3 Technical Standards (Weak)

SQ 23  Do building codes and office building measurement standards (ANSI/BOMA Z65.1) conform to international standards?

Building codes and uniform standards are being developed. The Honduras Institute of Architects and the International Code Council have agreement to develop the national building code for Honduras based on the 2006 International Building Code Spanish edition.

Source: Code Council, Honduras to Develop Building Code – Based on the International Building Code – International Code Council