Financial reporting

The information published by Poland's Ministry of Finance shows that the number of tax and customs controls is successively increasing. In the first half of 2022 there have been almost two thousand of such controls – it is almost 300 more than in the same period of 2021.

Poland is introducing regulations that will impose new reporting obligations on digital platform operators. Sellers should also pay attention to these changes, as they can expect more inspections to be carried out by tax authorities in order to verify the correctness of tax settlements.

In 2021, among the taxpayer’s reporting and information obligations for the tax year ending on December 31, 2020, there were reporting on contracts concluded with non-residents within the meaning of the foreign exchange law (ORD-U form) and reporting related to transactions with related entities or contractors from tax havens (TPR form). The obligation to submit the ORD-U information expired on March 31, 2021, and the TPR information on December 31, 2021.

It has been a while since my last post on the principles of accounting, and yet, over this long time I have had a number of discussions about my last blog article that helped me collect so many responses and concerns from my readers that I can now revisit the issues I discussed back then, this time from a slightly different perspective.

The economic reality is not so simple as it is described in academic textbooks, but this is the difference between theory and practice. This is particularly visible in our country, where young graduates of business schools often painfully collide with the business reality. Their enthusiasm is dampened on the occasion of an unassisted attempt at posting, settling taxes, preparing financial statements and performing audit controls. It's just the way it is and it can't be helped − at least until apprenticeship and training programmes based on case studies are implemented in the school system and classes are conducted by practitioners.

Apart from issues related to inaccurate presentation of figures in the balance sheet as well as profit and loss accounts, one may often encounter various shortcomings in relation to the cash flow account which is an important starting point for the analysis of the degree of financial liquidity of an undertaking as well as cash flow in the company. There may be also errors in respect to the notes to the financial statements and the most common one is the lack of adequate disclosures, including those relating to economic events which, in the given period, do not relate to the account books, yet they may have a significant impact in the future.