{"id":28419,"date":"2020-09-15T06:00:51","date_gmt":"2020-09-15T04:00:51","guid":{"rendered":"https:\/\/wplabs.hu\/demos\/wts\/2020\/09\/15\/financial-statements-during-voluntary-liquidation\/"},"modified":"2020-09-15T06:00:51","modified_gmt":"2020-09-15T04:00:51","slug":"financial-statements-during-voluntary-liquidation","status":"publish","type":"post","link":"https:\/\/wplabs.hu\/demos\/wts\/en\/2020\/09\/15\/financial-statements-during-voluntary-liquidation\/","title":{"rendered":"Accounting requirements of financial statements prepared during voluntary liquidation"},"content":{"rendered":"

As written in one of our earlier articles<\/a>, according to Hungarian law several different financial statements must be prepared during voluntary liquidation. In this article we will highlight the specific requirements of these financial statements.\u00a0<\/strong><\/p>\n

What financial statements must be prepared during voluntary liquidation?<\/strong>\u00a0<\/strong><\/h5>\n

If owners have decided to initiate the voluntary liquidation of an entity, they must prepare financial statements ending the company\u2019s activity<\/strong> as of the previous day. One of the liquidator\u2019s<\/a> main tasks after being appointed is to prepare an adjusted opening balance sheet for voluntary liquidation <\/strong>as of its start date of the proceedings. A voluntary liquidation must be completed within 3 years of its start date. During the voluntary liquidation period annual financial statements <\/strong>must be prepared and published for each 12-month period as a financial year, while annual tax returns <\/strong>must also be submitted. If there are subsequently no obstacles to completing the voluntary liquidation, the liquidator must prepare financial statements<\/strong> for the final period of the liquidation <\/strong>too.<\/p>\n

What provisions apply for financial statements prepared in relation to voluntary liquidations?<\/strong>\u00a0<\/strong><\/h5>\n

All of the above-mentioned types of financial statements are subject to specific rules, which need to be adhered to during their preparation. Firstly, the provisions of Government Decree 72\/2006 (IV.3) on the accounting tasks during voluntary liquidation need to be considered. For all matters not governed by the government decree, the Act on Accounting is applicable.\u00a0<\/strong><\/p>\n

Financial statements ending the company\u2019s activity<\/strong>\u00a0<\/strong><\/h5>\n

The financial statements ending the company\u2019s activity must be prepared at the start of the voluntary liquidation. Based on the owner\u2019s decision, the given financial year must be closed as of the day before the voluntary liquidation, as the reporting date. In this case it is important to note that the deadline<\/strong> is very tight: you only have 30 days<\/strong> to prepare the financial statements and have them approved by the owners. In the case of a compulsory audit<\/a>, the approved financial statements and the auditor\u2019s report must be filed and published within 30 days. The good news, though, is that the entity preparing the annual financial statements does not have to prepare a business report<\/strong>.<\/p>\n

Adjusted opening balance sheet for voluntary liquidation<\/strong>\u00a0<\/strong><\/h5>\n

The liquidator prepares an adjusted opening balance sheet for the voluntary liquidation as of the start date of the voluntary liquidation. By taking into account reported creditor claims and the assessment of the company\u2019s financial position, the liquidator may adjust the data of the opening balance sheet for voluntary liquidation<\/strong>: in practice, this means that new items can be added and existing ones amended. The adjusted opening balance sheet for voluntary liquidation is prepared in a three-column format. The first column contains the opening balance sheet data as of the start of the voluntary liquidation, the middle column contains the adjustments, and the third column contains the consolidated figures. The deadline<\/strong> for preparing an adjusted opening balance sheet for voluntary liquidation is 75 days<\/strong>.<\/p>\n

Annual financial statements to be prepared during voluntary liquidation<\/strong>\u00a0<\/strong><\/h5>\n

During voluntary liquidation, Hungarian business entities must compile annual financial statements for each financial year.<\/strong> Financial statements on the first financial year must be compiled within no later than 12 months from the start date of the voluntary liquidation. Besides the data of the previous period, this shall also present the impact on the balance sheet and the income statement caused by the differences in the adjusted opening balance sheet for voluntary liquidation. If the voluntary liquidation is not completed within the first financial year it started in, then there is a reporting obligation for each financial year during the voluntary liquidation until the proceedings are completed. These financial statements must be prepared, filed and published within 5 months<\/strong> and are also governed by the provisions of the Hungarian Act on Accounting prescribing an audit.<\/p>\n

Financial statements closing the voluntary liquidation, for the last period of the voluntary liquidation<\/strong>\u00a0<\/strong><\/h5>\n

One special requirement of the financial statements prepared by the liquidator for the last period of the voluntary liquidation is that all assets and liabilities other than liquid assets must be recognised at market value<\/strong>, and the impact on profit\/loss of the accounted differences must be recognised in the income statement as prescribed by the government decree. If the company\u2019s assets include items subject to VAT upon the distribution of assets, pursuant to the Hungarian Act on Value Added Tax, then the amount of VAT payable must be recognised as a liability against other expenses. The financial statements must be prepared, filed and published within 60 days<\/strong>.<\/p>\n

As our article reveals, a number of different types of financial statements must be prepared by companies during voluntary liquidation proceedings. During these special reporting tasks, Hungarian entities must consider not only the Act on Accounting but also the guidelines of the relevant government decrees, and in certain cases they have to comply with rather tight deadlines. Therefore, it is always worth relying on the help of experienced professionals. Feel free to contact the staff of WTS Klient Hungary<\/strong><\/a> for help.<\/p><\/blockquote>\n","protected":false},"excerpt":{"rendered":"

As written in one of our earlier articles, according to Hungarian law several different financial statements must be prepared during voluntary liquidation. In this article we will highlight the specific requirements of these financial statements.\u00a0 What financial statements must be prepared during voluntary liquidation?\u00a0 If owners have decided to initiate the voluntary liquidation of an […]<\/p>\n","protected":false},"author":35,"featured_media":9294,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[3015,706],"tags":[7389,18126,4914,2288,4920,18130,6433,3064,3067,16224,18133,7409,5490],"class_list":["post-28419","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-eng-news","category-wts-hirek-en","tag-act-on-accounting-en","tag-adjusted-opening-balance-sheet-for-voluntary-liquidation-en","tag-annual-financial-statements-en","tag-deadline-2","tag-financial-statements-en","tag-financial-statements-ending-the-companys-activity-en","tag-government-decree-en","tag-hungarian","tag-hungary","tag-liquidator-de-de","tag-register-of-reported-claims-en","tag-szamviteli-torveny-en-en","tag-voluntary-liquidation-en"],"acf":[],"yoast_head":"\nFinancial statements prepared during voluntary liquidation<\/title>\n<meta name=\"description\" content=\"Various financial statements must be prepared during voluntary liquidation. 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