At the end of March and June respectively, the deadline for filing the financial statements for 2021 expired. However, this period does not bring to an end all the obligations relating to the accounts. The company still has a few more tasks to do this year.
Disclosure of financial statements
At the same time, by filing their financial statements with the tax office, the companies fulfilled their legal obligation to publish their financial statements in the register of financial statements. The tax office automatically sends the filed financial statements for publication to the register of financial statements.
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Approval of financial statements
Companies could already file financial statements as approved or as unapproved. In the event that the financial statements have been filed as unapproved, limited liability companies and public limited liability companies are obliged to submit the financial statements to the general meeting for approval, so that the general meeting is able to approve them within 12 months of the date on which the financial statements are drawn up. For the financial statements for calendar year 2021, it must be approved by the general meeting by the end of December 2022.
Notification of approval of financial statements
After the filing of the unapproved financial statements and their subsequent approval by the general meeting, companies do not file the financial statements with the tax office once again, but only within 15 working days from the date of approval of the financial statements, notify the tax office of this date. The tax office then forwards the notice of approval of the financial statements to the register of financial statements for publication. Companies that have filed financial statements already approved with the tax authority no longer need to notify the tax authority of the date of approval of the financial statements.
How to make a profit or a loss
The approval of the financial statements is also linked to the decision of the shareholders or shareholders on how to deal with the economic result of the previous year. In the case of recognised profits, limited liability companies and public limited liability companies are first obliged to create or replenish a statutory reserve fund, up to the amount specified in the social contract, but not less than 10% and 20% of the share capital respectively.
Once a statutory reserve has been created or replenished, the members or shareholders may decide to pay the profits or use the profit to cover losses of previous years, or use it to increase the capital or create other funds. A frequent choice of members or shareholders is, in the event of profit or loss, their reallocation to an account of retained earnings or unpaid losses of previous years.
Beware of profit disbursement
When making a decision to make a profit, shareholders must take into account that their company does not go bankrupt by the payment of profits or that the value of their company's equity, by paying out the profit, is not less than the value of the share capital together with the reserve fund. At the same time, they can only pay out that part of the profit that exceeds the unpaid losses of the past.
An example from practice:
The obligations we provide are regulated by the Accounting Act and the Commercial Code. In the context of carrying out a tax audit, the tax office may also examine the fulfilment of those obligations. In practice, there were situations where the tax office found no error in the performance of the tax audit in terms of the calculation of the tax liability, so it focused on the fulfilment of administrative obligations and, in the event of a failure to fulfil its obligation to approve the accounts, completed the tax audit with a fine of EUR 100.