ACCOUNTING ACT
I GENERAL PROVISIONS
General Provisions
Article 1
This Act regulates accounting of enterprises, classification of entities, bookkeeping
documents and business books, property and obligation records, application of financial
reporting standards and the authority for adoption of the financial reporting standards,
annual financial reports and consolidation of the annual financial reports, auditing of the
annual financial reports, content of the annual reports, publication of the annual financial
reports, Register of Annual Financial Reports and supervision.
Terms and the Application of this Act
Article 2
(1) Provisions of this Act shall be applied by enterprises.
(2) For the purpose of this Act enterprises shall mean:
1. companies and sole traders specified by legislation regulating companies,
2. business units of enterprises referred to in item 1 of this paragraph with the head
office in a foreign country if according to regulations of that country there is no
obligation of bookkeeping and compilation of financial reports and business units
of enterprises from a foreign country which are taxpayers according to legislation
regulating taxes.
(3) Provisions of this Act, beside enterprises referred to in paragraph 2 of this Article,
shall be applied also by any legal or natural person that is a taxpayer defined by
legislation regulating taxes, with the exception of provisions regulating consolidation
of the annual financial reports (Article 16), auditing of the annual financial reports
(Article 17), annual report (Article 18) and publication (Article 20).
(4) Provisions of this Act shall not apply to the state budget and beneficiaries of state
budget, budgets of local and regional self-government units and their budget
beneficiaries, religious communities, political parties, trade unions and other nonprofit organisations.
(5) Accounting of religious communities, political parties, trade unions and other nonprofit organisations shall be prescribed by the Government of the Republic of Croatia.
Classification of Enterprises
Article 3
(1) For the purpose of this Act enterprises shall be classified into small, medium-sized
and large, depending upon indicators established on the last day of a financial year
preceding the year for which financial reports are compiled, according to the following
conditions:
- amount of total assets,
- amount of revenues,
- average number of employees during the financial year.
(2) Small enterprises shall not exceed two of the following conditions:
- total assets of 32,500,000.00 HRK,
- revenues of 65,000,000.00 HRK,
- average number of 50 employees during the financial year.
(3) Medium-sized enterprises shall be those that exceed two of the conditions referred to
in paragraph 2 of this Article but shall not exceed two of the following conditions:
- total assets of 130,000,000.00 HRK,
- revenues of 260,000,000.00 HRK,
- average number of 250 employees during the financial year.
(4) Large enterprises shall be those that exceed two of the conditions referred to in
paragraph 3 of this Article.
(5) Apart from large entities referred to in paragraph 4 of this Article, large enterprises in
terms of this Act shall also be banks, savings banks, building societies, electronic
money institutions, insurance undertakings, leasing companies, investment fund
managing companies and separate asset they manage that is not a legal entity,
investment fund managing companies and investment fund asset that is a legal entity,
compulsory or voluntary pension fund managing companies and separate asset they
manage and pension insurance funds.
Accounting Activities
Article 4
(1) Accounting activities shall be the collection and processing of data on the basis of
bookkeeping documents, preparation and compilation of business books, preparation
and compilation of the annual financial reports, collection and processing of data
relating to the preparation and compilation of the annual financial reports and
financial data for statistical, tax and other purposes.
(2) Enterprises shall collect and compile bookkeeping documents, compile business
books and compile financial reports in accordance with this Act and regulations
adopted on the basis thereof, respecting thereby accounting standards and basic
principles of orderly bookkeeping.
(3) Enterprises shall organise the collection and compilation of bookkeeping documents,
compilation of business books and compilation of the annual financial reports in such
a manner in which it is possible to verify transactions, financial position and success
of the enterprises' performance.
II BOOKKEEPING DOCUMENTS
Bookkeeping Documents
Article 5
(1) Bookkeeping document shall be written evidence or an electronic record of the
occurrence of a transaction.
(2) Bookkeeping document shall be produced at the place and at the moment of the
occurrence of a transaction, with the exception of those documents which are
prepared in the accounting units of enterprises.
(3) Bookkeeping document shall indisputably and authentically contain all data on a
transaction.
(4) Bookkeeping document shall be produced in one or more copies.
(5) Bookkeeping document produced in one copy may be expedited provided the data
contained therein are available at all times.
(6) Bookkeeping document shall also be a document received through a
telecommunication system, copy of an original document or a document on an
electronic data carrier if the document indicates the place where the original
document is kept, i.e. the reason why a copy was used and if it is signed by a person
authorized to represent the enterprise or a person to which this authority has been
transferred.
Compilation of Bookkeeping Documents
Article 6
(1) Bookkeeping documents shall be authentic, orderly and compiled in way that insures
control in time. Person authorized to represent the enterprise or a person to whom
this authority has been transferred shall guarantee by a signature on a bookkeeping
document that this bookkeeping document is authentic and orderly.
(2) Bookkeeping documents compiled in the form of an electronic record can instead of
signature of person authorized to represent the enterprise or a person to whom this
authority has been transferred contain name and surname or other distinguishing
mark of person authorized for issuing bookkeeping documents or it shall comply with
the legislation regulating electronic signature.
(3) Bookkeeping documents shall be such that a professional person shall be able to
identify a transaction therefrom.
(4) Enterprises are obligated to check accuracy and completeness of bookkeeping
documents before entering date from bookkeeping documents to business books.
Preservation of Bookkeeping Documents
Article 7
(1) Bookkeeping documents shall be preserved as originals, on an electronic data carrier
or micrographic processing carrier.
(2) Bookkeeping documents shall be preserved as follows:
1. payrolls, analytical records of salaries on which compulsory contributions are paid
– indefinitely,
2. documents based on which the data are entered into the journal and general
ledger – at least eleven years,
3. documents based on which data are entered into subsidiary ledgers – at least
seven years.
(3) Preservation period for bookkeeping documents referred to in paragraph 2, items 2
and 3 of this Article, shall start on the last day of the financial year to which the books
containing documents entered relate.
III BUSINESS BOOKS
Business Books
Article 8
(1) Business books shall be compiled according to the principles of double-entry
bookkeeping.
(2) Business books shall include: journal, general ledger and subsidiary ledgers.
(3) Journal is a book in which transactions are entered chronologically as they occur.
Journal may be organised as a single book or several books held separately for
changes in individual groups of balance sheet records or in off-balance sheet records.
(4) General ledger is a systematic bookkeeping record of changes in the financial
position and performance success.
(5) General ledger is composed of two independent components:
- balance sheet records and
- off-balance sheet records.
(6) General ledger shall contain accounts prepared in advance which, according to the
needs of enterprises, provide data for annual financial reports.
(7) As a rule, subsidiary ledgers are kept separately.
(8) Subsidiary ledgers kept for tangible assets shall be expressed in quantities and cash
values.
Compilation of Business Books
Article 9
(1) Data shall be entered into business books based on bookkeeping documents.
(2) Business books shall be compiled on the principle of unalterable records of the
occurrence of a transaction.
(3) As a rule, financial year equals to the calendar year but may also differ from the
calendar year.
(4) Business books shall be opened with the beginning of the financial year on the basis
of the balance sheet as of the end of the previous financial year or on the basis of the
list of assets and liabilities in case of newly founded enterprises or on the basis of the
bookkeeping documents.
(5) Business books shall be opened by transfer of the balance from the business books
concluded at the end of the previous business year.
(6) Business books shall be compiled to ensure control of entered data, accuracy of the
data entry, preservation of data, possibility of data utilisation, possibility of gaining
insight into transactions and balances on accounts of the general ledger and the
possibility of insight into the chronological sequence of entry of transactions.
Preservation of Business Books
Article 10
(1) Business books shall be concluded at the end of the business year and shall be kept
in periods prescribed by this Act.
(2) Where business books are compiled in the form of an electronic record, general
ledger shall be protected after conclusion at the end of a financial year in order to
preclude changes to some or all of its parts or sheets, to enable its printing out on
paper at any time and shall have to be signed with an electronic signature in
accordance with the legislation regulating the electronic signature or shall have to be
printed on paper and bound in order to preclude changes to some or all of its parts or
sheets and shall have to be signed by a person authorized to represent the
enterprise.
(3) Business books shall be preserved as follows:
1. journal and general ledger – at least eleven years,
2. subsidiary ledgers – at least seven years.
(4) Preservation period of business books shall start on the last day of a financial year to
which they relate.
IV LIST OF ASSETS AND LIABILITIES
List of Assets and Liabilities
Article 11
(1) Upon commencement of business activity, enterprises shall list their assets and
liabilities and indicate their individual values in quantities and in cash values.
(2) Enterprises shall at least once, at the end of a financial year, list their assets and
liabilities and adjust the book balance with the balance in the list.
(3) Enterprises listing out assets and liabilities during a financial year shall adjust the
book balance with the balance according to the list at the end of a financial year.
(4) In addition to the list referred to in paragraph 2 of this Article, enterprises shall list
assets and liabilities in cases of changes in prices of products and goods, status
changes, opening of winding up and bankruptcy procedures.
V FINANCIAL REPORTING STANDARDS
Financial Reporting Standards
Article 12
(1) Croatian Financial Reporting standards (hereinafter referred to as CFRS) are
accounting principles and rules for compilation and presentation of financial reports
applied by the accounting profession.
(2) CFRS shall be adopted by the Financial Standards Reporting Committee, in
accordance with this Act.
(3) CFRS shall be published in the Official Gazette.
(4) International Financial Reporting Standards cover International Accounting Standards
(IAS), their supplements and related interpretations and International Financial
Reporting Standards (IFRS), their supplements and related interpretations that are
approved by European Commission and published in official gazette of European
Union.
Application of the Financial Reporting Standards
Article 13
(1) Enterprises shall compile and present the annual financial reports by applying the
CFRS.
(2) By way of derogation from the provision of paragraph 1 of this Article, large
enterprises and enterprises whose shares or debt securities are listed or are
prepared to be listed in a regulated capital market shall compile and present the
annual financial reports by applying International Financial Reporting Standards.
VI FINANCIAL REPORTING STANDARDS COMMITTEE
Financial Reporting Standards Committee
Article 14
(1) Financial Reporting Standards Committee (hereinafter referred to as: the Committee)
shall be a body with the following competencies:
1. it shall analyse and monitor development of accounting theory and practice,
2. it shall adopt the CFRS,
3. it shall deliver interpretations of the CFRS,
4. it shall prepare and publish the CFRS,
5. it shall perform other activities established by this Act.
(2) The Committee shall consist of nine members that shall be appointed for a five-year
mandate and relieved of their duty by the Government of the Republic of Croatia on a
proposal from the Minister of Finance.
(3) Any citizen of the Republic of Croatia with a university degree, adequate expertise
and work experience in the field of finance, accounting or auditing may be nominated
a member of the Committee and thus be qualified as a competent and trustworthy
member of the Committee.
(4) Committee members shall receive a fee for their work.
(5) The Committee shall be financed from the state budget and with own revenues
obtained from fees.
(6) The Committee shall adopt the Ordinance on work methods, confirmed by the
Government of the Republic of Croatia.
(7) The Ordinance shall contain provisions on objectives, work methods, decisionmaking, financing and fees.
(8) The Committee shall once a year submit a report on its activities to the Government
of the Republic of Croatia.
VII FINANCIAL REPORTS
Annual Financial Reports
Article 15
(1) Enterprises shall compile the annual financial reports in the form, content and method
prescribed by this Act and regulations adopted on the basis thereof.
(2) By way of derogation from the provision of paragraph 1 of this Article, enterprises
whose business activity is regulated with the particularly legislation and by which
body authorized for performing surveillance prescribed structure and content of the
annual financial reports, shall compile the annual financial reports comply with this
Act and those regulations.
(3) Annual financial reports shall be:
- balance sheet,
- profit and loss account,
- cash flow statement,
- statement on changes in shareholders' equity,
- notes to the annual accounts.
(4) The structure and content of the annual financial reports shall be prescribed by the
Minister of Finance on a proposal from the Committee and shall be published in the
Official Gazette.
(5) By way of derogation from the provision of paragraph 4 of this Article, structure and
content of the annual financial reports for enterprises referred to in paragraph 2 of this
Article shall be prescribed by the body authorized for performing surveillance of their
business activity and shall be published in the Official Gazette.
(6) Annual Financial Reports shall provide a truthful and objective presentation of the
financial position and success of performance of enterprises.
(7) Annual financial reports shall be compiled for the financial year that corresponds to
the calendar year.
(8) By way of derogation from paragraph 7 of this Article, financial year may differ from
the calendar year, if specified by other regulation or for necessities of enterprises.
(9) Enterprises shall compile annual financial reports in cases of status changes, opening
of bankruptcy or winding up proceedings against the enterprise, with the balance as
at the day preceding the date of registration of the status changes, day of the opening
of the bankruptcy proceedings or initiation of the winding up proceedings against the
enterprise.
(10) By way of derogation from the provision of paragraph 3 of this Article, small
enterprises shall compile the balance sheet, profit and loss account and notes to the
financial reports.
(11) Authorized representative of the enterprise shall be responsible for the annual
financial reports.
(12) Annual financial reports shall be signed by the authorized representative of the
enterprise.
(13) Annual financial reports shall be preserved indefinitely in their original form.
Consolidation of the Annual Financial Reports
Article 16
(1) Consolidated annual financial reports are financial reports of group of enterprises in
which certain enterprise (ruling company) has over one or more enterprise right of
(2)
(3)
(4)
(5)
(6)
(7)
(8)
conducting financial and business politics so it accomplish benefits (control), and they
are presented as single financial report.
Enterprise that in group of enterprises represent ruling company shall compile the
consolidated annual financial reports.
For the purpose of this Act, an enterprise shall be deemed a ruling enterprise if it
fulfils one of the following conditions:
1. it possesses a majority of stocks or business shares that give vote in the other
enterprise,
2. it has the right to appoint or relieve from duty a majority of management or
supervisory board members of the other enterprise or,
3. it has the right of the considerable ruling influence on the other enterprise based
on the contract or other legal relationship or,
4. if a majority of the management or supervisory board members of the dependent
enterprise, who performed that function during the past financial year and still
perform it until the compilation of the annual financial reports, were appointed
exclusively for the purpose of exercising the voting rights of the ruling enterprise
or,
5. it has the share in decision-making or the right to make decisions in the
dependent enterprise based on the agreement with other shareholders or holders
of the right of decision-making such as to supervise the majority vote in the
dependent enterprise.
Provisions of Article 15, paragraphs 4-13 of this Act shall apply to the compilation of
the consolidated annual financial reports.
Consolidated annual financial reports shall not have to include the financial position
and success of the performance of the dependent enterprise if this has no significant
influence to the financial position and success of the performance of the ruling
enterprise.
In case of paragraph 5 of this Article the enterprise shall state in the notes to the
financial reports the reasons why the financial position and success of performance of
the particular enterprise was not included in the consolidated annual financial reports.
Detailed conditions and rules for consolidation of the annual financial reports shall be
prescribed by the CFRS.
By way of derogation from the provision of paragraph 7 of this Article, detailed
conditions and rules for consolidation of the annual financial reports of enterprises
that are obliged to compile and present the annual financial reports in accordance
with Article 13, paragraph 2 of this Act shall be prescribed by the International
Financial Reporting Standards.
Auditing of the Annual Financial Reports
Article 17
(1) Subject to audit shall be the annual financial reports and consolidated annual
financial reports of large enterprises, medium-sized enterprises and enterprises
whose shares or debt securities are listed or prepared to be listed to a regulated
capital market and of enterprises which are obliged to compile the consolidated
annual financial reports.
(2) Subject to audit shall be the annual financial reports of enterprises to which it is
prescribed by special legislation regulating their performance.
(3) Audited report shall contain at least:
1. an introduction indicating financial reports subject to audit, together with the
accounting policies that were used for their compilation,
2. description of the purpose and scope of the audit, with the indication of the
auditing standards according to which the audit was made,
3. opinion of the auditor clearly expressing whether the annual financial reports give
true and fair view of the enterprise's financial position in accordance with this Act
and the CFRS, i.e. International Financial Reporting Standards, and whether the
annual financial reports are in accordance with legislation regulating operations of
the entrepreneur, the auditor's opinion can be unqualified, unqualified with an
explanatory paragraph or qualified or a disclaimer of opinion if the auditor is
unable to express an opinion,
4. specific warnings and problems which the auditor wants to indicate, without giving
an explanatory paragraph to the unqualified opinion,
5. opinion on harmonisation of the annual report with the annual financial reports for
the same financial year.
(4) The authorized auditor shall sign the audit report and indicate the date of its
compilation.
(5) Audit of financial report and harmonisation with the annual report shall be carried out
in accordance with legislation regulating audit.
(6) Audit report shall be preserved indefinitely in its original copy.
VIII ANNUAL REPORT
Annual Report
Article 18
(1) Enterprises shall produce the annual report which covers the objective review of the
development and results of the enterprise's performance and its position, together
with description of main risks and uncertainties enterprises face, and information on
the environmental protection and on employees, if necessary for understanding of the
development, business results of the enterprise and the position thereof.
(2) Annual report shall contain:
1.
all significant events after the end of the financial year,
2.
probable future development of the company,
3.
research and development activities,
4.
information on the purchase of treasury shares,
5.
information whether the enterprise has branches,
6.
which financial instruments are utilised if this is significant for the assessment of
the financial position and success of performance,
7.
objectives and policies of the enterprise relating to financial risk management,
together with the policy relating to the protection of each relevant type of
projected transactions for which the protection is used,
8.
exposure of the enterprise to the price risk, credit risk, liquidity risk or cash flow
risk.
(3) Annual report of the large enterprise and enterprise whose shares or debt securities
are listed in the regulated capital market shall contain also the review of rules of
corporate governance it employs.
(4) By way of derogation from the provision of paragraph 1 of this Article, small
enterprises shall not be obliged to prepare the annual report, but then the information
on the purchase of treasury shares shall be provided in notes to the financial reports.
(5) Annual reports shall be preserved in their original copy for the period of eleven years
from the last day of the financial year for which they have been made.
Language and Currency Unit
Article 19
(1) Business books, annual financial reports, annual reports and other financial
information shall be compiled in the Croatian Language.
(2) Amounts in business books, annual financial reports, annual reports and other
financial information shall be expressed in the currency unit which is in use in the
Republic of Croatia.
IX PUBLICATION
Publication
Article 20
(1) Enterprises shall deliver the annual financial reports, annual reports, the audit reports
if their reports are subject to audit in accordance with provisions of Article 17 of this
Act and the consolidated annual financial reports if their annual financial reports are
subject to consolidation in accordance with provisions of Article 16 of this Act to the
Financial Agency for the purpose of their publication.
(2) By way of derogation from provisions of paragraph 1 of this Article, small enterprises
shall submit the annual financial reports referred to in Article 15, paragraph 10 of this
Act to the Financial Agency for the purpose of their publication.
(3) In addition to the reports mentioned in paragraph 1 or 2 of this Article, enterprises
shall also submit to the Financial Agency the decision on adoption of the annual
financial report by a competent body and the decision on distribution of profit or
covering of loss, if they are not an integral part of annual financial reports or the
annual report.
(4) Enterprise shall submit the reports referred to in paragraph 1 and 2 of this Article
within a maximum of six months from the last day of a financial year, while
enterprises that compile consolidated financial reports shall submit them within a
maximum of nine months from the last day of a financial year.
(5) Enterprise compiling annual financial reports in accordance with Article 15, paragraph
9 of this Act shall submit the annual financial reports within ninety days from the day
of occurrence of a status change, initiation of the winding up procedure or opening of
bankruptcy proceedings and for the following financial years in accordance with
paragraph 4 of this Article.
(6) Enterprises shall be deemed to have fulfilled their obligation of publication on the day
of submission to the Financial Agency of complete and accurate annual financial
reports, annual report, audit report, if the enterprise's annual financial reports are
subject to audit in accordance with provisions of Article 17 of this Act and
consolidated annual financial reports if their annual financial reports are subject to
consolidation in accordance with provisions of Article 16 of this Act.
(7) Enterprises may submit the reports referred to in paragraphs 1 to 3 of this Article on
paper or in an electronic form.
Financial Data for Statistical and Other Purposes
Article 21
(1) For statistical and other purposes enterprises shall submit to the Financial Agency, by
31 March of the current year, the balance sheet, profit and loss account and
additional data for the previous calendar year.
(2) Form and content of the additional data referred to in paragraph 1 of this Article shall
be prescribed by the Minister of Finance.
(3) By way of derogation from the provision of paragraph 1 of this Article enterprises
which by 31 March of the current year submit to the Financial Agency the reports
referred to in Article 20 of this Act for the purpose of publication, provided that the
financial year equals to the calendar year, shall submit only additional data for
statistical purposes.
X REGISTER OF ANNUAL FINANCIAL REPORTS
Register of Annual Financial Reports
Article 22
(1) Register of Annual Financial Reports shall be a central source of information on the
financial position and success of performance of enterprises.
(2) Register of Annual Financial Reports shall contain data on the financial position and
success of performance and additional data referred to in Article 21, paragraph 1 of
this Act.
(3) Register of Annual Financial Reports shall be maintained in the electronic form and
shall be available on internet sites.
(4) Register of Annual Financial Reports shall show publicly on internet the following for
each individual enterprise:
1. annual financial reports,
2. annual report,
3. data on proposed distribution of profit or cover of loss.
(5) In addition to the mentioned in paragraph 4 of this Article, the Register of Annual
Financial Reports shall show publicly on internet also the consolidated financial
reports of enterprises that are obliged to compile them in accordance with Article 16
of this Act and the audit report if the annual financial reports of enterprises are subject
to audit in accordance with provisions of Article 17 of this Act.
(6) By way of derogation from paragraph 4 of this Act, the Register of Annual Financial
Reports for small enterprises shall publicly on internet show the annual financial
reports referred to in Article 20, paragraph 2 of this Act in their abridged content.
(7) Electronic form and form of display of the annual financial reports for public displaying
on web site of Register of Annual Financial Reports shall be determined by the
Financial Agency in accordance with the structure and content of the annual financial
reports referred to in Article 15 paragraph 4 and 5 of this Act and shall be published
on the internet site of the Register of Annual Financial Reports.
(8) Internet sites shall be set up in such a way as to enable anyone to have a free insight
into the data referred to in paragraph 4 of this Article.
(9) It shall also be possible to access internet sites referred to in paragraph 4 of this
Article from internet sites of the Court Register.
Maintenance of the Register of Annual Financial Reports
Article 23
(1) Register of Annual Financial Reports shall be maintained by the Financial Agency.
(2) Financial Agency shall enter the data referred to in Article 22, paragraphs 4, 5, and 6
of this Act to the Register of Annual Financial Reports and show publicly on internet
sites within 30 days from reception of the established, accurate and complete annual
financial reports of enterprises.
(3) Financial agency shall preserve the annual financial reports, annual reports, audit
reports and other documentation for the period of eleven years from the day of their
reception from enterprises.
(4) For the purpose of maintaining the Register of Annual Financial Reports the Financial
Agency shall be authorized to collect, record, process, archive and publish the annual
financial reports and annual reports of enterprises, distribute data from the annual
financial reports, manage the database and ensure the protection of the database
and documents that are stored in archive.
(5) Financial Agency shall be entitled to a fee for maintenance of the Register of Annual
Financial Reports.
(6) Financial Agency shall be authorized to draw at the end of each month the data from
the Court Register which originated in the previous month and the data of the Tax
Administration Register with the balance as at 31 December, for the purpose of the
entry into the Register of Annual Financial Reports.
(7) Financial Agency shall be responsible for the authenticity of the electronic entry of
data from the annual financial reports for publication and for process of other data
and documents that are recorded in Register of Annual Financial Reports.
(8) Type and amount of fees referred to in paragraph 5 of this Article shall be prescribed
by the Minister of Finance.
(9) Financial Agency shall calculate and collect fees referred to in paragraph 5 of this
Article and regulation adopted on the basis of paragraph 8 of this Article.
(10) Upon reception and publication of the annual financial reports and annual report the
Financial Agency shall notify thereof the Court Register.
(11) Notification referred to in paragraph 10 of this Article shall contain data on the date of
reception and the period to which the annual financial reports and annual report refer.
(12) Notification to the Court Register shall be submitted free of fee.
(13) Financial Agency shall notify the Ministry of Finance - Tax Administration on
enterprises that don’t deliver the annual financial reports or annual reports or the
audit reports or the consolidated annual financial reports in accordance with
provisions of Article 20 of this Act.
(14) Maintenance method of the Register of Annual Financial Reports, manner of
reception and the procedure relating to the verification of the completeness and
accuracy of the annual financial reports and annual reports shall be prescribed by the
Minister of Finance.
Use of Data from the Register of the Annual Financial Reports
Article 24
(1) Financial Agency shall, upon written request of the interested person, issue a copy or
a print out of the annual financial reports, annual report or the audit report which are
published in accordance with this Act.
(2) Financial Agency shall enable the access to the Central Bureau for Statistics and Tax
Administration or it shall deliver all data from the Register of the Annual Financial
Reports free of fee.
(3) Financial Agency may deliver the data from the Register of Annual Financial Reports
to other institutions if that data are used for the purpose of performing statistical,
scientific and analytical activities and analyses.
(4) Published data from the Register of the Annual Financial Reports and the data
obtained in the manner referred to in paragraph 2 and 3 of this Article may be used
only for personal uses and may not be ceded to third parties, distributed or published.
XI SUPERVISION
Supervision of Accounting Activities
Article 25
(1) Ministry of Finance – Tax Administration shall be authorized to perform supervision of
enterprises in the part related to accounting activities for the purpose of verification
whether the enterprise performs the accounting activities in accordance with the
provisions of this Act, other acts regulating activities of enterprises that contain
provisions relating to accounting activities and regulations adopted on the basis of
those acts.
(2) Supervision of enterprises in the part related to accounting activities for the purpose
of verification whether the enterprise performs the accounting activities in accordance
with the provisions of this Act and other regulation that regulate business activities of
enterprise, that contains provisions related to accounting activities, shall be also
authorized to perform Croatian National Bank and Croatian Financial Services
Supervisory Agency if they are, by that regulation, authorized to perform supervision
of enterprises’ business activities.
(3) Provisions of this Act about supervision of enterprises in the part related to
accounting activities shall adopt on adequate way to persons referred to in Article 2,
paragraph 3 of this Act.
Supervision Method
Article 26
Ministry of Finance – Tax Administration shall perform supervision of enterprises in the
part of accounting activities by way of:
1. monitoring, collecting and verification of bookkeeping documents, business books,
annual financial reports and annual report and other tax and statistical reports
(analysis of financial reports),
2. control of the system used by enterprises for data processing in relation to
accounting activities,
3. on-site supervision in enterprises' premises.
Authorised Supervisors
Article 27
Supervision of enterprises in the part of accounting activities shall be carried out by
inspectors and other authorised persons of the Ministry of Finance – Tax Administration.
Scope of the Supervision
Article 28
(1) Enterprises shall make possible to the authorised person the supervision of all
bookkeeping documents, business books, annual financial reports and annual report,
other tax and statistical reports and systems which are used for data processing.
(2) Upon request of the Ministry of Finance – Tax Administration enterprises shall submit
the copies of documents or financial reports referred to in paragraph 1 of this Article.
(3) Enterprises shall make available to the authorised persons of the Ministry of Finance
– Tax Administration the appropriate premises in which they can freely and without
presence of other persons perform supervision of accounting activities.
(4) Persons authorised for representation of the enterprise and employees of the
enterprise shall, upon request of the authorised person of the Ministry of Finance –
Tax Administration provide all bookkeeping documents, business books, annual
financial reports and annual reports and other tax and statistical reports and
information on accounting activities important for supervision.
(5) Ministry of Finance – Tax Administration may call persons from paragraph 4 of this
Article to prepare a written report or call them to give a verbal statement within a
period which should not be shorter than 3 days.
Notification on Supervision
Article 29
(1) Notification on supervision of activities shall be delivered to the enterprise at least 8
days prior to the commencement of the supervision.
(2) By way of derogation from the provision of paragraph 1 of this Article, the authorised
person may deliver the notification on supervision at the beginning of the supervision
if it was not possible to achieve otherwise the objective of the particular supervision.
(3) Notification on supervision shall contain the subject matter of the supervision.
Supervision Measures
Article 30
(1) Ministry of Finance – Tax Administration may adopt the following supervision
measures:
1. decision on removal of irregularities,
2. initiation of a petty offence procedure or criminal procedure.
(2) Decision referred to in paragraph 1, item 1 of this Article shall be final and may be
challenged by filing an administrative lawsuit.
(3) Enterprises that received a decision referred to in paragraph 1, item 1 of this Article
shall remove the identified irregularities within a deadline specified by the decision
and inform thereof in writing the Ministry of Finance – Tax Administration, providing
the proof on removed irregularities within 8 days from expiry of the deadline specified
by the decision.
XII PENAL AND OFFENCE PROVISIONS
Penal Provisions
Article 31
(1) Authorised representatives of enterprises shall be subject to a fine ranging from HRK
20,000.00 to HRK 100,000.00 for a criminal act referring to incorrect presentation of
assets, financial position and success of performance of the enterprise with the intent
to obtain financial advantage for their own or a third party's account or to cause
damage to someone.
(2) For the offence referred to in paragraph 1 of this Article enterprises shall be subject to
a fine ranging from HRK 50,000.00 to HRK 500,000.00.
(3) Enterprises whose transactions recorded in business books are based on invalid
documentation shall be subject to a fine ranging from HRK 50,000.00 to 500,000.00.
Offence Provisions
Article 32
(1) Enterprises and persons referred to in Article 2, paragraph 3 of this Act shall be
subject to a fine ranging from HRK 10,000.00 to HRK 100,000.00 in case of:
1. failure to maintain business books (Article 4)
2. failure to compile bookkeeping documents (Article 5)
3. failure to compile bookkeeping documents in accordance with provisions of
this Act (Articles 5 and 6)
4. failure to control bookkeeping documents prior to the entry into business
books (Article 6)
5. failure to preserve bookkeeping documents during periods and in the manner
pursuant to provisions of this Act (Article 7)
6. failure to maintain business books in accordance with provisions of this Act
(Article 9)
7. failure to open business books in accordance with provisions of this Act
(Article 9)
8. failure to conclude business books in accordance with provisions of this Act
(Article 10)
9. failure to protect business books recorded on an electronic data carrier in
accordance with provisions of this Act (Article 10)
10. failure to preserve business books during periods and in the manner in
accordance with provisions of this Act (Article 10)
11. failure to list assets and liabilities in accordance with provisions of this Act
(Article 11)
12. failure to compile and present the annual financial reports by application of the
CFRS, i.e. International Financial Reporting Standards (Article 13)
13. failure to compile the annual financial reports (Article 15)
14. failure to compile the annual financial reports in accordance with provisions of
this Act (Article 15)
15. failure to preserve the annual financial reports during periods and in the
manner in accordance with provisions of this Act (Article 15)
16. failure to compile the consolidated financial accounts (Article 16)
17. failure to compile the consolidated financial accounts in accordance with
provisions of this Act (Article 16)
18. failure to preserve the consolidated financial accounts within periods and in
the manner in accordance with provisions of this Act (Article 16)
19. failure to audit the annual financial reports (Article 17)
20. failure to preserve the audit report during periods and in the manner in
accordance with provisions of this Act (Article 17)
21. failure to produce the annual report (Article 18)
22. failure to produce the annual report in accordance with provisions of this Act
(Article 18)
23. failure to compile business books and to compile financial reports and other
financial information in the Croatian language and in the currency unit which is
in use in the Republic of Croatia (Article 19)
24. failure to submit to the Financial Agency the annual financial reports, annual
reports and the auditor's opinion, in case of obligation to audit the annual
financial reports and other documents, for the purpose of publication within
deadlines in accordance with provisions of this Act (Article 20)
25. using the data obtained from the Register of Annual Financial Reports
contrary to the provisions of Article 24, paragraph 4 of this Article
26. failure to enable the supervision to the authorised person in accordance with
provisions of this Act (Article 28)
27. failure to remove the identified irregularities and to inform thereof the Ministry
of Finance in accordance with provisions of this Act (Article 30)
(2) Responsible persons of the enterprise shall also be subject to a fine ranging from
HRK 5,000.00 to HRK 20,000.00 for the offence referred to in paragraph 1 of this
Article.
(3) Natural persons shall be subject to a fine ranging from HRK 5,000.00 to HRK
20,000.00 in case they use the data obtained from the Register of the Annual
Financial Reports contrary to provisions of Article 24, paragraph 4 of this Act.
Limitation of Legal Proceedings
Article 33
(1) Offence proceedings for offences envisaged by this Act may not be instituted after
expiry of three years from the day of discovery that the offence was completed.
(2) Limitation of legal proceedings shall occur in any case when six years expire from the
day on which the offence was completed.
(3) Provisions of the Misdemeanour Act shall apply to the procedure and termination of
the limitation of instituting the offence proceedings.
XIII TRANSITIONAL AND FINAL PROVISIONS
Proceedings
Article 34
(1) Committee founded on the basis of the Accounting Act (Official Gazette No. 146/05)
shall continue its activities also according to this Act.
(2) Term of office of the Committee members appointed on the basis of the Accounting
Act (Official Gazette No. 146/05) shall cease on the day of appointment of the
Committee members according to this Act.
(3) Until the day of accession of the Republic of Croatia to the membership of the
European Union, the International Financial Reporting Standards shall cover
International accounting standards (IAS), their supplements and related
interpretations and International Financial Reporting Standards (IFRS), their
supplements and related interpretations, approved the Committee and shall be
published in the Official Gazette.
(4) Translations of the International Financial Reporting Standards into the Croatian
language may be entrusted by the Committee to parties that are authorised for that
by the International Accounting Standards Board.
(5) Committee may charge a fee for approval of translations.
(6) Register of Annual Financial Reports was founded on the basis of the Act on the
Register of Annual Financial Reports (Official Gazette 47/03) and shall be maintained
in accordance with this Act.
Adoption of Regulations
Article 35
(1) On a proposal from the Minister of Finance the Government of the Republic of Croatia
shall, within two months from entry into force of this Act:
1. adopt the regulation on accounting of religious communities, political parties,
trade unions and other non-profit organisations referred to in Article 2,
paragraph 5 of this Act.
2. appoint members of the Committee based on authorities referred to in Article
14, paragraph 2 of this Act.
(2) On the basis of the authorities stipulated by this Act the Minister of Finance shall,
within two months from entry into force of this Act, adopt the following:
1. regulation on the structure and content of the annual financial reports referred
to in Article 15, paragraph 4 of this Act,
2. regulation on the form and content of additional data referred to in Article 21,
paragraph 2 of this Act,
3. regulation on types and amount of fees for the Financial Agency for
maintaining the Register of Annual Financial Reports in accordance with
Article 23, paragraph 8 of this Act,
4. regulation on the method of maintaining the Register of Annual Financial
Reports and the manner of reception and procedure for verification of
completeness and accuracy of the annual financial reports and the annual
report referred to in Article 23, paragraph 14 of this Act.
(3) On the basis of authorities stipulated by this Act the Committee shall, within two
months from entry into force of this Act, adopt the following:
1. CFRS referred to in Article 12, paragraph 2 of this Act,
2. Ordinance on the manner of work referred to in Article 14, paragraph 7 of this
Act,
(4) On the basis of authorities stipulated by this Act the Financial Agency shall, within 3
months from entry into force of this Act, adopt the following:
1. form and abridged form of the annual financial reports referred to in Article 22,
paragraph 7 of this Act.
(5) Until entry into force of regulations referred to in paragraph 1 of this Article,
regulations adopted on the basis of the Accounting Act (Official Gazette No. 146/05)
and Act on the Register of Annual Financial Reports (Official Gazette No. 47/03) shall
be valid.
Termination of Validity of Legislation
Article 36
(1) Accounting Act (Official Gazette No. 146/05) and Act on the Register of Annual
Financial Reports (Official Gazette No. 47/03) shall cease to be valid on the day of
entry into force of this Act
Entry into Force
Article 37
This Act will be published in Official Gazette and shall enter into force 1st January 2008.,
with the exception of Article 12, paragraph 4 and Article 17 which shall enter into force on
the day of accession of the Republic of Croatia to the membership of the European
Union.