Pursuant to Article 41 of the Audit Act, entities subject to audit are required to select and appoint an audit firm no later than three months before the end of the reporting period to which the statutory audit applies - that is, by September 30, 2022 for the audit of the annual financial statements for 2022.
Entrepreneurs subject to audit independently shape the criteria for selecting an audit firm, usually these are price, audit quality, reputation of the audit firm, and the like. In addition, the obligation to conduct an audit in case of status changes, when establishing a company and investing things and rights in the share capital is regulated by the Companies Act.
Who is subject to audit?
Article 20 of the Accounting Act stipulates the obligation to audit the financial reports of companies, so the annual financial statements and annual consolidated financial statements of entities of public interest, as well as large and medium-sized enterprises that are not entities of public interest, are subject to the same.
Entities subject to audit are:
- large entrepreneurs
- medium-sized entrepreneurs
- subjects of public interest
- parent companies of large and medium-sized groups
- entrepreneurs who submitted a request for listing their securities (shares) on the regulated market
- entrepreneurs who participated in business mergers, acquisitions or divisions as acquirers or newly founded companies.
In addition, annual financial reports and consolidated annual financial reports for 2022 of joint-stock companies, limited partnerships and limited liability companies whose individual or consolidated data in 2021 exceed at least two of the three criteria are subject to audit:
- assets HRK 15 million
- revenues HRK 30 million
- at least 25 workers on average during the year.
Deadline for publication of audit reports
The deadline for publishing audited reports, or audit reports, is six months from the last day of the business year. Entrepreneurs subject to public disclosure who prepare annual consolidated reports must publish them together with the audit report no later than nine months after the last day of the business year.
Trade unions and employers' associations are obliged to submit to the Ministry a financial audit report on the audit of the annual financial statements for the previous year no later than June 30 of the current year.
An audit is not an unnecessary expense, but an opportunity to align financial statements with the legislative framework and gain a realistic picture of the business, so do not hesitate to contact our best experts!
Data source: www.zakon.hr