On June 7 of this year, the draft law No. 627/Lp14 “Amendments to the Annual Accounts and Consolidated Annual Accounts Act” submitted to the Saeima proposes to significantly raise the thresholds for the balance sheet total and net turnover criteria set out in the law for recognizing company sizes and group categories, as well as the application of exemptions from preparing financial statement annexes (see table below).
Company Thresholds (Article 5)
| Indicator | Currently | Planned from 2024 |
|---|---|---|
| Micro-company | ||
| Balance sheet total | 350,000 | 450,000 |
| Net turnover | 700,000 | 900,000 |
| Average number of employees | 10 | |
| Small company | ||
| Balance sheet total | 4,000,000 | 5,000,000 |
| Net turnover | 8,000,000 | 10,000,000 |
| Average number of employees | 50 | |
| Medium company | ||
| Balance sheet total | 20,000,000 | 25,000,000 |
| Net turnover | 40,000,000 | 50,000,000 |
| Average number of employees | 250 |
Group Categories (Article 6)
| Indicator | Currently | Planned from 2024 |
|---|---|---|
| Small group | ||
| Balance sheet total | 4,000,000 | 5,000,000 |
| Net turnover | 8,000,000 | 10,000,000 |
| Average number of employees | 50 | |
| Medium group | ||
| Balance sheet total | 20,000,000 | 25,000,000 |
| Net turnover | 40,000,000 | 50,000,000 |
| Average number of employees | 250 |
Thresholds for Exemption from Preparing Financial Statement Annexes (Article 58)
| Indicator | Currently | Planned from 2024 |
|---|---|---|
| Micro-company | ||
| Balance sheet total | 50,000 | 63,000 |
| Net turnover | 100,000 | 125,000 |
| Average number of employees | 5 |
The transitional provisions of the law stipulate that the new company thresholds (Articles 5, 58) will apply starting from the 2024 reporting year (the reporting year beginning on January 1, 2024, or during the 2024 calendar year).
The amendments to the law also clarify the content of the Management Report (Article 55), specifying that the Management Report should include general information and incorporate a sustainability report in accordance with the Sustainability Information Disclosure Act.
©INNOVATOR 11.06.2024.
