In 1st of January 2016 new Accounting law will separate micro, small, medium and big corporations and small, medium and big consolidation groups.
The most changes in the annual statement submitting will be for the micro companies. The micro entrepreneur who follows financial accounting and reporting based on the Estonian Accounting Standard can submit annual statement that shows balance sheet, income statement and up to four appendixes (appendixes have to include information governed by law). Micro companies don’t have to generate cash flow and equity change statement. Also they don’t need activity report.
What companies apply as micro companies? Those are limited liability partnerships whose all total assets are not more than 175,000€, liabilities are not bigger than equity, one owner who is also a chairman of the board and sales revenue is not more than 50,000€ annually.
If all the previously mentioned requirements are not met, then the corporation will not classify as micro company and will not be able to submit simplified annual statement. E.g. when assets and liabilities are applicable but owner is not board member then the company will be classified as small company.
Small corporations are those who are not micro companies and whose assets don’t exceed 400,000€ and have less than 50 employees. They have to submit annual statement with activity report more information about the assets and liabilities. They are also able not to compile cash flow and equity change statement.
Medium size company is enterprise that is registered in Estonia and who is not micro or small corporation and whose one of the parameters is above the following indicators. Total assets 20M€, annual revenue 40M€ or average employees number is over 250. Those companies have to submit all annual statement requirements with detailed overview in the appendixes.
Big corporation is a company whose assets are over 20M€ or revenue over 40M€ and average employees number is above 250. For the big companies the requirements for annual statement are the same as medium size with some additional requirements for activity report.
So the annual statement submitting got simpler for micro and small companies. For the medium and big corporation there were basically no changes and the requirements even increased.
Jelena Scheberina, Finantskonsultant OÜ partner