The Accountancy Act (AA) created prerequisites for assimilating the form and content of the European Economic Community countries’ financial statements. The more significant requirements in the AA concern the opportunity for direct implementation of the International Accountancy Standards for companies, required to do so by the law, as well as the implementation of the National Accountancy Standards for the small and average enterprises.
The law entitles the preparation of the accountancy documents of the enterprises both in Bulgarian and in the respective foreign language and in foreign currency in cases of transactions, executed with foreign contractors in foreign currency.
Each enterprise has the opportunity to determine on its own system of agreeing the allocation in the accountancy balance and the report for the incomes and expenses under the sequence of significance. The act regulates in details the issue of which entities may prepare the annual financial statements and under what provisions.
The enterprise determines on its own the accountancy policy and records.
According to the AA, the annual financial statements of companies, in which two of the following criteria have been exceeded, are subject to audit: a. Total assets – 1 million BGN; b. Net amount of the operating revenue – 2 million BGN; c. full time equivalent of 50 employees.