An annual financial statement is being filed at the end of the accounting year. It presents a combination of interconnected financial and accounting informational materials that report a company’s returns, as well as its active and passive assets. It provides virtually every piece of information available on the financial status of the company. An annual financial statement needs to be precise and thoroughly prepared; to contain only accurate information and to implement a comparison of the current financial situation of the company with previous years while also evaluating the changes.

What does an annual financial statement include?

Subject to Article 29, paragraph 1 and 2 of the Accounting Act in conjunction with point 2 of the National Accounting Standard, the annual financial statement consists of:

  1. Balance sheet
  2. Statement of revenue and expenditure
  3. Cash flow statement
  4. Statement of equity
  5. Annex, statement of fixed assets

Micro-enterprises (up to 10 employees, net income up to BGN 1 400 000 and net book value of assets up to BGN 700 000, not applicable to investment and financial holding companies) may have to include the first two points only, and small enterprises (up to 50 employees, net revenue up to BGN 16,000,000 and net book value of assets up to BGN 8,000,000) – the first two points plus an annex.

Annual financial statement – who, when, where?

The annual financial statement is filed in the Commercial Register every year by the end of June and reports the activity of the company throughout the previous calendar year. Companies that haven’t submitted their report or submitted it after the deadline are subject to a fine. Composing an annual financial statement requires the signature of an accountant by law – it can not be completed by a company manager alone. Submitting the statement is possible both offline and online via an electronic signature.

Who is not required to file an annual financial statement?

The latest changes in the rules for filing an AFS and a declaration for lack of activity under Art. 38, paragraph 9, item 2 has been announced in issue 96 of the SG in 2019. They declare the lack of obligation of the ET, which did not perform any activity during the reporting year, to submit a declaration for lack of activity in the Commercial Register and the Legal Persons Engaged in a Non-profit Making Activity Register. Those companies are also not obliged to file an annual financial statement. The amendments to the law also state that declaring a lack of activity by those required to declare it will be done only once – it will be enough to file a declaration of no activity in 2019 by the end of March 2020, eliminating the need for subsequent filing of this declaration again a year later. Declarations for lack of activity under Art. 38, paragraph 9, item 2 should already be designed as approved by the Minister of Finance. Annual financial statements are only filed by companies with recorded activities.