ISSN 1452-6662
Over 180 up-to-date legal acts of the Republic of Serbia translated to English.
Issue: LAW ON ACCOUNTING 73/2019-11
Published in the Službeni glasnik RS, Nos. 73/19 of 11 October 2019 and 44/21 of 29 April 2021 (other law)

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  • Subject Matter of Regulation
     Article 1

    This Law shall regulate the reporting entities subject to application of this Law, classification of legal entities and entrepreneurs, accounting organizations, accounting documents and types of books of account, conditions and method of keeping books of account, Register of accounting service providers, recognition and valuation of items in financial statements, preparation, submission and publication of financial statements, annual business reports, corporate management reports, reports on payments to government authorities and non-financial reporting, the Register of Financial Statements, the National Accounting Commission, as well as oversight of the implementation of the provisions of this Law.

  • Definitions
     Article 2

    Individual terms, within the meaning of this Law, shall be understood to have the following meanings:

    1) legal entities shall include companies, the National Bank of Serbia, banks, payment institutions, electronic money institutions, insurance companies and reinsurance companies (hereinafter: insurance companies), providers of financial leasing, pension funds and companies for voluntary pension fund management, investment funds and companies for investment fund management, stock exchanges and broker-dealer companies, Central Securities, Depository and Clearing House, factoring companies, cooperatives, institutions that perform a for-profit business activity, legal entities that, in accordance with special regulations, apply the provisions of this Law as well as other legal entities as determined by this Law;

    2) other legal entities shall be considered to be the legal entities whose business operations are partly financed from government revenues or other dedicated sources of funding, and revenues in part or fully earned in the market or on the basis of membership and that are not established for profit (political organizations, trade unions with the capacity of a legal entity, foundations and endowments, associations, chambers, churches and religious communities in the part relating to the performance of economic or other activities in compliance with the regulations that govern the performance of these activities, as well as other organizations established on the basis of membership);

    3) entrepreneurs are natural persons within the meaning of the law regulating companies, who keep their books of account by the double-entry bookkeeping system, unless where provided otherwise by special regulations;

    4) International Financial Reporting Standards (hereinafter referred to as IFRS), within the meaning of this Law, are: Conceptual Framework for Financial Reporting, International Accounting Standards - IAS, International Financial Reporting Standards - IFRS, interpretations issued by the International Financial Reporting Interpretations Committee - IFRIC, the translation of which has been determined and published by the Ministry in charge of finances (hereinafter: the Ministry). The translation of IFRS that is determined and published by the Ministry shall comprise of the Conceptual Framework for Financial Reporting, the main texts of IAS and IFRS issued by the International Accounting Standards Board, as well as interpretations issued by the International Accounting Standards Interpretations Committee, in the form in which they were issued, and which do not include the bases for closing, illustrated examples, guidelines, comments, opposing opinions, elaborated examples and other supplementary explanatory material that may be adopted in relation to the standards and/or interpretations, unless explicitly stated that it constitutes an integral part of the standards or interpretations;

    5) International Financial Reporting Standards for Small and Medium-Sized Entities (hereinafter referred to as IFRS for SMEs) is an accounting standard for financial reporting for small and medium-sized legal entities, approved by the International Accounting Standards Board (IASB), the translation of which is determined and published by the Ministry. The translation of IFRS for SMEs determined and published by the Ministry comprises the basic text of the IFRS for SMEs issued by the International Accounting Standards Board;

    6) regular annual financial statement is a report that should give a true and fair view of the financial position and success of operating performance (for example, of assets and liabilities of the legal entity and/or entrepreneur, as well as profit and loss) of a legal entity and/or entrepreneur, and that is prepared for the financial year that is equal to the calendar year or that is different from the calendar year;

    7) consolidated annual financial statement is the financial statement of economic whole (group) comprising of the parent entity and all the subsidiary legal entities;

    8) interim financial statement shall be prepared in cases of status changes (in the case of a status change of acquisition, the interim financial statement shall be prepared by the legal entity that terminates its operations, while in the case of a status change of split-up the interim financial statement is prepared by the legal entity that in the procedure of the change sets aside a part of its assets and liabilities, unless where prescribed otherwise by a special law), opening and/or closing of bankruptcy proceedings or initiating and/or closing of liquidation proceedings over legal entities, and as at the date preceding the day of entry of the status change, date of opening and/or closing of bankruptcy proceedings or opening and/or closing of liquidation proceedings. The interim financial statement shall additionally be prepared in cases of deletion of a branch of a foreign legal entity referred to in Article 4, paragraph 3 of this Law and/or an entrepreneur referred to in item 3) of this Article;

    9) legal regulations shall be understood to mean this Law and by-laws adopted for the enforcement of the Law;

    10) internal regulations, within the meaning of this Law, shall be understood to mean the general acts adopted by a legal entity and/or an entrepreneur, which  comprise specific instructions and guidelines for the organization of accounting and maintenance of books of accounts, the accounting policies for the recognition and valuation of assets and liabilities, revenues and expenditures, as well as other matters related to keeping books of account and preparation of financial statements that are regulated by the general act of a legal entity or an entrepreneur as prescribed by this Law;

    11) balance sheet date shall be the date on which financial statements are prepared, i.e. the date on which the reporting period ends;

    12) Balance Sheet shall mean the financial statement in which assets, liabilities and equity are presented as at a specified date (as at the balance sheet date);

    13) Income Statement shall mean the financial statement in which revenues, expenditures and operating results accomplished over the reporting period are presented;

    14) Statement of Other Comprehensive Income shall mean the financial statement consisting of revenue and expenditure items that are not recognized in Income Statement but, as required by individual IFRSs, i.e. IFRS for SMEs, are recognized in equity;

    15) Statement of Changes in Equity shall mean the financial statement which presents information on changes in equity over the reporting period;

    16) Statement of Cash Flows shall mean the financial statement which provides information on inflows and outflows of cash and cash equivalents over the reporting period;

    17) Notes to Financial Statements shall mean the financial statement which contains descriptions or breakdown of items disclosed in other financial statements, the accounting policies applied, as well as information on items that did not qualify for recognition in these statements and are important for assessing the financial position and operating performance of a legal entity, as well as other information in accordance with the requirements of IFRS, i.e. IFRS for SMEs, of this Law, and/or the by-law referred to in Article 26 of this Law;

    18) Statistical Report shall mean the report in which individual items of the Balance Sheet and Income Statement, as well as other data used for statistical purposes, are presented in more detail;

    19) a public-interest undertaking shall mean a legal entity that is in compliance with the provisions of the law regulating auditing classified as a public-interest undertaking;

    20) share (shares, i.e. stakes in compliance with the law regulating companies) represents the right in equity of other legal entities, irrespective of whether these are materialized in the form of certificates or not, which are, on the basis of the permanent connection to such legal entities, acquired with the intention of contributing to the business operations of the legal entity holding such rights. It shall be considered that the share in equity of another legal entity is a share within the meaning of application of this Law in the case where such share represents 20 or more percent of equity of such other legal entity;

    21) a related party shall mean the natural or legal person that is associated with the legal entity within the meaning of IFRS;

    22) operating revenues shall mean the amount generated from the sale of products and goods and from provision of services, following the deduction of rebates, value added tax and other taxes directly related to revenues;

    23) parent legal entity shall mean the legal entity that is controlling one or more subsidiary legal entities;

    24) subsidiary legal entity shall mean the legal entity that is controlled by the parent legal entity, including all the subsidiary legal entities of the end parent legal entity;

    25) group shall mean the parent legal entity and all its subsidiary legal entities that with the parent legal entity make a single economic whole;

    26) related legal entities shall be any two or more legal entities within a group;

    27) legal entity connected by a stake shall mean the legal entity in which another legal entity holds a stake and over whose operational and financial policy such other legal entity exercises significant influence. It shall be considered that a legal entity is exercising a significant influence over another legal entity if it holds 20 or more percent of voting rights of the shareholders or members in such other legal entity, unless where regulated otherwise by a special regulation;

    28) a materially significant item shall mean the item whose omission or misstatement may impact the decisions passed by the users of the financial statements. Materiality of individual items shall be assessed in the context of other similar items;

    29) insolvency estate within the meaning of this Law shall be the assets of the insolvency debtor which is subject to continuation of bankruptcy proceedings in case of a suspension or closure of such proceedings over the insolvency debtor, within the meaning of the law regulating bankruptcy;

    30) approval data for disclosure of financial statements shall be the date on which the competent body of the legal entity i.e. entrepreneur (in most of the cases the legal representative) has permitted that the financial statements are disclosed (delivered to the supervisory body, shareholders' assembly, etc.). The approval date for disclosure shall serve for determining the events following the balance sheet date;

    31) a legal entity active in extractive industry shall mean the legal entity pursuing a business activity that includes exploration, prospecting, discovering, development and extraction of coal, crude oil and natural gas, metal ores, non-ferrous ores, other mining and extraction of stone, sand, clay, gravel, etc.;

    32) a legal entity engaged in cutting of primary forests shall mean the legal entity that pursues the business activity of cutting threes in the wood (does not include cutting trees in multiannual plantations);

    33) governmental authority, within the meaning of this Law, shall be any national, regional or local public authority of the Republic of Serbia, a Member State or a third country. That shall additionally include departments, agencies or companies controlling such governmental authority within the meaning of the provisions of Articles 39 and 40 of this Law;

    34) a project, within the meaning of this Law, shall mean the operational activities regulated by one contract, licence, lease, concession or a similar agreement and shall provide the basis for payment of liabilities vis-à-vis the governmental authorities. Where a number of such contracts are mutually related, these shall then be considered to be a single project;

    35) payment, within the meaning of this Law, shall be amount that is paid, either in money, goods, services or rights for the activities of the legal entities referred to in items 31) and 32) of this Article. Payments can have the form of:

    (1) rights to production;

    (2) tax on income, production or profit of legal entities, excluding the consumption taxes such as the value added tax, personal income tax or excise taxes;

    (3) preference;

    (4) dividends;

    (5) signature, discovery and production bonuses;

    (6) licence fees, lease fees, entry fees and other licences and/or concessions; and

    (7) payments for the infrastructural improvements;

    36) Member States - Member States of the European Union.

  • Determining and Publication of Translations of IFRS and IFRS for SMEs
     Article 3

    The translations of IFRS, i.e. of IFRS for SMEs shall be determined by a decision by the Ministry.

    The decision referred to in paragraph 1 of this Article, whereby the date of beginning of implementation of IFRS, i.e. IFRS for SMEs is determined as well, together with the text of IFRS, i.e. IFRS for SMEs translation, shall be published by the Ministry in the "Službeni glasnik Republike Srbije" and on the website of the Ministry.

    Where that is envisaged by a special law, application of IFRS shall be permitted even before the date referred to in paragraph 2 of this Article.

    The Ministry shall be obliged to permanently publish translations of IFRS and IFRS for SMEs on its website and to clearly designate the period over which the published version of the translated IFRS and IFRS for SMEs in question applies.