Electronic disclosure of financial statements

Mónika Marczin, tax expert partner of RSM DTM Hungary Ltd. believes companies should take the content requirements and filing deadline of electronic financial statements seriously because failure to comply with the electronic reporting obligation entails severe and automatic legal sanctions, which may even prevent the company from continued operation.

Pursuant to effective provisions of the Act on Accounting and the Act on Public Company Data, from 1 st May, 2009 the companies keeping double entry books may only deposit their financial statements with the Company Information Service electronically. The financial statements filed through the governmental client portal “Ügyfélkapu” are automatically disclosed; therefore, companies can properly meet two obligations at the same time this way.

The submitted material must include a copy of the annual report – and if the company has audit obligation, the independent auditor’s report containing the audit clause – and the resolution on the use of the profit after tax.

The deposited financial statements are accessible for everyone free of charge on the website of the Company Information Service. The person or company filing the financial statements is liable for the matching of the data reported in the financial statements sent to the Company Information Service with the data content of the accepted financial statements.

The person acting on behalf of the company receives two confirmations of the submission of the financial statements; one from the governmental client portal “Ügyfélkapu” and one from the Company Information Service. We must point out that if the financial statements and its annexes are not submitted properly from an IT perspective (e.g. they are not sent in the proper format); the financial statements are not accepted and disclosed.

Annual reports must be submitted within 150 days of the balance sheet date of the given business year, i.e. until 30th May, 2010 in the case of financial statements prepared as of 31st December, 2009. For consolidated annual reports, this deadline is 180 days from the balance sheet date of the business year, i.e. June 29, 2010.

The Company Information Service forwards the successfully submitted financial statements to the tax authority. Hence, from 2010 the companies failing to meet this obligation will be reminded to comply by the tax authority within 30 days of the expiry of the deadline for filing. These companies will be given a 15 days’ period to meet the filling obligation.

If a taxpayer fails to submit his financial statements within the deadline set in the reminder of the tax authority, the tax authority will, through a resolution, initiate the suspension of the taxpayer’s tax number for a period of 60 days. No appeal may be submitted against this decision and as long as the taxpayer’s tax number is suspended, he may not reclaim taxes and, if his tax number is cancelled, he may not exercise his right of tax reclaim in the future either.

If the taxpayer still does not comply with the disclosure obligation during the period of the suspension, the tax authority will initiate the termination of the company at the court of registration.

 

Should you have any questions regarding the above, do not hesitate to contact our colleagues (phone: +36 1 886 3700, e-mail: monika.marczin@rsmdtm.hu).

The Newsletter contains general information. Therefore, the content of the Newsletter may not be regarded as professional advice or comprehensive information for decision-making. This information – due to its nature – may not address all details, especially all circumstances of a certain transaction. Although we used every effort for our Newsletter to be comprehensive, we cannot assume liability for the outlining and interpretation of the relevant regulations.