Amendment and supplement of the Accounting Act
27/08/24
Changes to the Accounting Act come into force with retroactive date of July 6, 2024. These include a new sustainability reporting obligation and higher thresholds for enterprise categories and mandatory financial audit.
Sustainability reporting
Large enterprises as well as some small and medium-sized should include in their annual management reports information about the main intangible resources, how the enterprise depends on them and how they create value for the enterprise. They should also include separate section with information related to sustainability (sustainability report).
Instead of Non-financial declaration and Consolidated non-financial declaration, enterprises prepare Sustainability report and Consolidated sustainability report which contains information how the enterprise or the group affects sustainability issues and how this impact its development, results and state. The report must contain quantitative and qualitative information that is disclosed in accordance with the requirements of the European Sustainability Reporting Standards. The sustainability report is part of the annual management report and will be published in unified electronic reporting format. Enterprises subject to statutory independent financial audit will accordingly be audited in connection with sustainability reporting.
- First reporting period
The sustainability reporting obligation is phased in as follows:
· 2024 – for large enterprises that are enterprises of public interest and with an average number of employees over 500 people (including on a consolidated basis);
· 2025 – all large enterprises (including on a consolidated basis);
· 2026 - for small and medium-sized enterprises, whose shares are traded on a regulated market or which are certain types of financial institutions.
- Penalties
The law provides for fines for not including and not publishing a sustainability report in the activity report, as well as for incomplete or incorrect information.
Categories of enterprises
The categories of enterprises remain the same however the thresholds for the "book value of assets" and "net sales revenue" indicators are increased. The new thresholds and the values as of December 31, 2023 determine the category of enterprise or group of enterprises for 2024.
The categories of enterprises are determined based on values that do not exceed at least two of the criteria as follows:
| Micro-enterprises | Small enterprises | Medium-sized enterprises | Large enterprises are enterprises which exceed at least two of the following criteria | |
| book value of the assets | BGN 900,000 | BGN 10,000,000 | BGN 50,000,000 | BGN 50,000,000 |
| net sales revenue | BGN 1,800,000 | BGN 20,000,000 | BGN 100,000,000 | BGN 100,000,000 |
| average number of employees for the reporting period | 10 | 50 | 250 | 250 |
Accordingly, the criteria for the categories of groups of enterprises also change.
Thresholds for independent financial audit
The thresholds of the criteria for the annual and consolidated financial statements subject to audit are also changed. Subject of independent financial audit are the financial statements of enterprises which as of 31 December of the reporting period exceed at least two of the following criteria:
1. book value of the assets – BGN 4,000,000;
2. net sales revenue – BGN 8,000,000;
3. average number of employees for the reporting period: 50.
Request for a proposal
Tax Newsletter
Contact us
