Who approves the annual financial statements in Poland and by what date?

If a company wishes to distribute profit on the basis of its financial statements, it needs to approve them first.

The Accounting Act states that the head of an entity shall ensure that the annual accounts are prepared no later than within 3 months of the balance sheet date. In most cases, that is for entities in which the reporting year coincides with the calendar year, the deadline is 31 March. According to Art. 53 of the Accounting Act the approval body is authorized to approve financial statements. In practice it is the supreme organ in the structure of an organization. In the case of enterprises that conduct economic activities, it will be the owner; in joint stock companies and limited liability companies it will be the general meeting of shareholders; in partnerships, joint ventures, civil partnerships and joint-stock limited companies – it will be the general assembly of members.

The statutory time period for approval of financial statements is 6 months after the balance sheet date. Companies and entities that, in accordance with the requirements of the Accounting Act, are obliged to have their annual financial statements audited by an auditor are required to obtain such an audit opinion before approving the report. However the financial statements of companies which have been declared bankrupt are not subject to approval.

Method of approval

In order to approve the annual financial report, an approval body is convened. This is obviously not applicable to natural persons conducting business activities who approve their financial statements individualy.

The approval of the annual financial statements takes place after their examination and takes the form of a resolution or decision of the approval body or a statement of will in the case of entitites conducting economic activity. A resolution or decision of the approval body should include:

• information on the period to which the annual accounts refer;
• the documents that make up the financial statements, i.e. the balance sheet, profit and loss account, additional information, information on changes in equity, cash flow statement.

Individuals conducting business activity have the right to approve financial statements through a statement of will. In practice it is sufficient for each item of the report to be accompanied by a clause stating "Approved", together with the date and signature. In the case of a limited liability company approval is performed by adopting a resolution of shareholders. In a joint stock company approval of financial statements is made by way of a shareholders resolution in the form of a notarial deed.

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