Companies must prepare their consolidated financial statements until August 31st this year. These statements include, among others, the consolidated balance sheet, the consolidated profit and loss account and the notes adherent to these documents. Legal entities that do not comply with the filing regulations risk penalties of up to 30,000 lei. Our Romanian accountants can give you detailed information about how to prepare these documents.
Who must prepare the consolidated financial statements?
Any legal entity in Romania must prepare the annual consolidated financial statements as well as a consolidated manager’s report. For branches in Romania
, the law stipulates that the mother company abroad has the duty to prepare these annual financial documents. The rules and regulations applicable to these submissions are those of the International Financial Reporting Standards (IFRS).
Economic entities in Romania must submit financial statements according to their size. Companies are classified in the following way:
- micro-entities: total assets – 350,000 EUR;
- small entities: total assets – 4,000,000 EUR;
- medium and large entities: total assets – 4,000,000 EUR.
Groups can also be divided into small and medium groups or large groups.
How are the consolidated financial statements drawn up?
The consolidated financial statements
represent a collection of several other financial documents, lie the balance sheet and the profits and loss account. Company managers should submit a report for each financial year. The information must be true and present the activities of the company as well as any potential risks. Company owners should know that regulatory authorities in Romania
can request that additional information are submitted along with the mandatory documents.
The annual consolidated financial statements are evaluated based on the principle that the legal entity will continue its financial activity in the coming year and will not reduce its activities or enter into a liquidation phase. Should the company managers decide that the company needs to be liquidated, the consolidated financial statements are not to be drawn up.