Financial statements of an s.r.o.: what they contain and when to file them

The financial statements summarise the entire accounting year and are among the most important documents a company has. For a limited liability company (s.r.o.), preparing and filing them is a legal obligation with precisely set deadlines that are worth knowing in advance.

What financial statements are

The financial statements of an s.r.o. are a set of reports that show the company’s assets, liabilities, equity and financial result as at the last day of the accounting period. For the authorities, the shareholders and business partners alike, they provide a picture of the company’s financial health.

Because they are deposited in a public register, banks and potential business partners can also look at them. Well-prepared financial statements therefore increase the company’s credibility.

What they consist of

• the balance sheet, which records the assets and the sources that finance them
• the profit and loss statement, showing costs and revenue
• the notes, which supplement and explain the figures

The scope of the financial statements depends on the size category of the company. Smaller entities prepare them in abridged form, larger ones in full, possibly with further mandatory components.

Steps before preparing them

Before the financial statements themselves, the year-end closing procedures must be carried out. This means checking transactions and posting any outstanding entries so that the reports faithfully reflect reality.

• stocktaking (inventory) of assets and liabilities
• posting depreciation and accruals and deferrals
• creating valuation allowances and provisions
• checking that account balances agree and carry over correctly

Filing deadlines

The financial statements are deposited in the Register of Financial Statements (register účtovných závierok), as a rule within the deadline for filing the tax return. Under certain conditions this deadline can be extended, which also moves the date for depositing the financial statements.

Always check the specific dates for the tax period in question, as they can change. Missing the deadline carries penalties, so it is better to have a clear reminder in your calendar.

Approval and deposit

The financial statements must be approved by the company’s general meeting, usually within a set period after the end of the accounting period. This is a formal step by which the shareholders confirm the financial results.

Financial statements that have not been approved are deposited as well, but with a note that they have not yet been approved, and the approval is added afterwards. Following this procedure is important to keep the company’s documentation in order.

The difference between ordinary and extraordinary financial statements

The ones you will encounter most often are the ordinary financial statements, prepared as at the last day of the regular accounting period. Alongside them, however, there are also extraordinary financial statements, which are prepared in special situations.

Extraordinary financial statements come into play, for example, when a company enters liquidation, in a merger or in other fundamental changes. The principles for preparing them are similar; what differs is the timing and the reason for preparing them.

How to prepare for the financial statements without stress

Good financial statements cannot be put together in a single day. If you keep your accounts up to date and in good order throughout the year, the year-end closing procedures will be faster and you will not have to chase documents needlessly.

• processing documents continuously throughout the year
• timely stocktaking of assets and liabilities
• time set aside for checks and any corrections

Who the financial statements are for

The financial statements are not just an obligation towards the authorities. They are a valuable basis for the shareholders, who use them to decide, for example, on the distribution of profit, and for banks when assessing an application for financing.

That is exactly why it pays to give their preparation enough attention. Clear and correctly prepared financial statements of an s.r.o. strengthen the company’s credibility externally and at the same time give management a clear picture of its financial performance.

Related articles: Accounting documents: what they must contain and how long to archive them, Stocktaking and warehouse stock: a practical guide, Depreciation of assets: straight-line vs. accelerated depreciation.

Frequently asked questions

By when must an s.r.o. file its financial statements?

The financial statements are deposited in the Register of Financial Statements, as a rule within the deadline for filing the tax return. This deadline can be extended under certain conditions. Check the exact date for the specific period, as it may differ.

What are the consequences of not filing financial statements?

The Financial Administration (Finančná správa) may impose a fine for failing to meet this obligation. Apart from the penalty, it also damages the company’s credibility with banks and partners, who check the financial statements in the public register. That is why it pays to observe the deadlines strictly.