Reporting

Important message

If an entity was required to perform statutory audit of its financial statement under "the Law of Georgia on Accounting and Auditing of the Financial Statements" of June 29, 2012, an entity shall report its financial statement, consolidated financial statement and audit report of the year 2016 to the Service for Accounting, Reporting and Auditing Supervision Subdivision of the Ministry of Finance of Georgia immediately, but not later than October 1st, 2017. If the reporting period of an entity doesn't coincide with the calendar year, an entity should report them immediately, but not later than 9 months from the end of the reporting period.

Public Interest Entity (hereinafter PIE)
A legal entity, which represents:
a) An Accountable enterprise whose securities are admitted to trading on the stock exchange in accordance with "the Law of Georgia on Securities Market";
b) A commercial bank and a qualified credit institution in accordance with "the Organic Law of Georgia on the National Bank of Georgia";
c) A microfinance organization in accordance with "the Law of Georgia on Microfinance Organizations";
d) An insurer in accordance with "the Law of Georgia on Insurance";
e) A founder of non-state pension scheme in accordance with "the Law of Georgia on Non-State Pension Insurance and Welfare";
f) An investment fund in accordance with "the Law of Georgia on Investment Funds";
g) A Non-bank deposit institution – credit union in accordance with "the Law of Georgia on Non-Bank Deposit Institutions – Credit Union";
h) Entities defined as PIEs by the Government of Georgia.

Financial Statement
Financial statement of the PIE shall be prepared according to the International Financial Reporting Standards (IFRS).

Management Report

  • All PIEs shall prepare a review of the entity’s activities.
  • A PIE, which is an accountable enterprise, whose securities are admitted to trading on a stock exchange in accordance with "the law of Georgia on securities market" shall prepare a corporate governance statement.
  • A PIE, which is the first category enterprise and whose average number of employees during the reporting period exceeds 500 persons, shall prepare a non-financial statement.
Note: If the information covered by the management report is mentioned in the Financial Statement, an entity will not be obliged to provide it in the management report.

Report on Payments to Government
PIE active in the extractive industry (including extraction of oil and gas) or the logging of primary forests, shall prepare a report on payments to government on an annual basis.

Audit of the Financial Statement
PIE shall ensure performance of the audit of its financial statements for each reporting period.

Audit of the Management Report
An Auditor/Audit firm has to express an opinion whether the review of the entity’s activities and the parts of the Corporate Governance Statement envisaged under the article 7, paragraph 7, points “c” and “g” of "the law of Georgia on Accounting, Reporting and Auditing” have been prepared in accordance with the applicable legal requirements and whether they are consistent with the financial statements for the same reporting period. An Auditor/Audit firm identifies material misstatements and gives an indication of any such misstatements if needed. An Auditor/Audit firm checks whether the parts of the corporate governance statement and non-financial statement envisaged under article 7, paragraph 7, points “a” “b” “d”-”f” have been provided.

Periodicity of Preparation of the Financial/Non-financial Statements
PIE shall prepare its Financial Statement, Management Report and Report on Payments to Government at least once in a year.

Date of Reporting of the Financial/Non-financial Statements and the Audit Report
PIE shall report its Financial Statement, Management Report, Report on Payments to Government and Audit Report immediately but not later than October 1st of the next year of the reporting period. If the reporting period of an entity doesn't coincide with the calendar year, an entity should report them immediately but not later than 9 months from the end of the reporting period.

First Reporting Obligation
PIE shall report its Financial Statement, Management Report, Report on Payments to Government and Audit Report of the financial year 2017 immediately but not later than October 1st 2018.

Enterprise of the First Category
An entity* the criteria of which at the end of the reporting period meet at least two criteria out of the following three:
• The value of total assets exceeds GEL 50 million;
• The revenue exceeds GEL 100 million;
• The average number of employees during the reporting period exceeds 250 persons;

* Entity − legal entities of public and private law, except for the budgetary organizations as defined under the Budget Code of Georgia and the National Bank of Georgia, a branch of a foreign enterprise, an individual entrepreneur, if they represent an enterprise of the third, second or first category.

Financial Statement
Financial statement of the enterprise of the first category shall be prepared according to the International Financial Reporting Standards (IFRS).

Management Report
Enterprise of the first category shall prepare a review of the entity’s activities.

Note: If the information covered by the management report is mentioned in the financial Statement, an enterprise will not be obliged to provide it in the management Report.

Report on Payments to Government
An enterprise active in the extractive industry (including extraction of oil and gas) or the logging of primary forests, shall prepare a report on payments to government on an annual basis.

Audit of the Financial Statement
An enterprise of the first category shall ensure performance of the audit of its financial statements for each reporting period.

Audit of the Management Report
An Auditor/Audit firm has to express an opinion whether the review of the entity’s activities has been prepared in accordance with the applicable legal requirements and whether they are consistent with the financial statements for the same reporting period. An Auditor/Audit firm identifies material misstatements and gives an indication of any such misstatements if needed.

Periodicity of Preparation of the financial/non-financial statements
An enterprise of the first category shall prepare its Financial Statement, Management Report and Report on Payments to Government at least once in a year.

Date of reporting of the financial/non-financial Statements
An enterprise of the first category shall report its Financial Statement, Management Report, Report on Payments to Government and Audit Report immediately, but not later than October 1st of the next year of the reporting period. If the reporting period of an enterprise doesn't coincide with the calendar year an entity should report them immediately, but not later than 9 months from the end of the reporting period.

First reporting obligation
An enterprise of the first category shall report its Financial Statement, Management Report, Report on Payments to Government and Audit Report of the financial year 2017 Immediately, but not later than October 1st 2018.

Enterprise of the Second Category
An entity*, which does not represent an enterprise of the fourth or the third category and the criteria of which at the end of the reporting period meet at least two criteria out of the following three:
a) The value of total assets does not exceed GEL 50 million;
b) The revenue does not exceed GEL 100 million;
c) The average number of employees during the reporting period does not exceed 250 persons.

* Entity − legal entities of public and private law, except for the budgetary organizations as defined under the Budget Code of Georgia and the National Bank of Georgia, a branch of a foreign enterprise, an individual entrepreneur, if they represent an enterprise of the third, second or first category.

Financial Statement
Financial statement of the Enterprise of the third category shall be prepared according to the International Financial Reporting Standards for Small and Medium-sized Entities (IFRS for SME). In addition, the enterprise is entitled to apply the International Financial Reporting Standards (IFRS).

If the respective legislative or normative act regulating activity of an enterprise envisages application of the higher financial reporting standards, an entity is obliged to follow the latter.

Management Report
Enterprise of the second category shall prepare a review of the entity’s activities.

Note: If the information covered by the management report is mentioned in financial Statement, an enterprise will not be obliged to provide it in the management report.

Audit of the Financial Statement
An enterprise of the second category shall ensure performance of the audit of its financial statement for each reporting period.

Audit of the Management Report
An Auditor/Audit firm has to express an opinion whether the Review of the entity’s activities has been prepared in accordance with the applicable legal requirements and whether they are consistent with the financial statements for the same reporting period. An Auditor/Audit firm identifies material misstatements and gives an indication of any such misstatements if needed.

Periodicity of Preparation of Financial/Non-financial Statements
An enterprise of the second category shall prepare its Financial Statement and Management Report at least once in a year.

Date of Reporting of the Financial/Non-financial Statements
An enterprise of the second category shall report its Financial Statement, Management Report and Audit Report immediately, but not later than October 1st of the next year of the reporting period to the Service. If the reporting period of an enterprise doesn't coincide with the calendar year, an entity should report them immediately, but not later than 9 months from the end of the reporting period.

First Reporting Obligation
An enterprise of the second category shall report its Financial Statement, Management Report and Audit Report of the financial year 2017 immediately, but not later than October 1st 2018.

Enterprise of the Third Category
An entity*, which does not represent an enterprise of the fourth category and the indicators of which at the end of the reporting period meet at least two criteria out of the following three:
a) The value of total assets does not exceed GEL 10 million;
b) The revenue does not exceed GEL 20 million;
c) The average number of employees during the reporting period does not exceed 50 persons.

* Entity − legal entities of public and private law, except for the budgetary organizations as defined under the Budget Code of Georgia and the National Bank of Georgia, branch of a foreign enterprise, individual entrepreneur, if they represent an enterprise of the third, second or first category.

Financial Statement
Financial statement of the enterprise of the third category shall be prepared according to the International Financial Reporting Standards for Small and Medium-sized Entities (IFRS for SME). In addition, the enterprise is entitled to apply the International Financial Reporting Standards (IFRS).

* If the respective legislative or normative act regulating activity of an enterprise envisages application of the higher financial reporting standards, an entity is obliged to follow the latter.

Enterprise of the third category is not required to ensure performance of the audit of its financial statement, unless otherwise provided by Georgian legislation.

Periodicity of Preparation of Financial Statement
An enterprise of the third category shall prepare its Financial Statement at least once in a year.

Date of Reporting of the Financial Statement
An enterprise of the third category shall report its Financial Statement immediately, but not later than October 1st of the next year of the reporting period to the Service. If the reporting period of an enterprise doesn't coincide with the calendar year, an enterprise should report them immediately, but not later than 9 months from the end of the reporting period.

First Reporting Obligation
An enterprise of the third category shall report its Financial Statement of the financial year 2018 immediately, but not later than October 1st 2019.

Enterprise of the fourth category
An entity*, the criteria of which at the end of the reporting period meet at least two criteria out of the following three:
a) The value of total assets does not exceed GEL 1 million;
b) The revenue does not exceed GEL 2 million;
c) The average number of employees during the reporting period does not exceed 10 persons.

* Entity − legal entities of public and private law, except for the budgetary organizations as defined under the Budget Code of Georgia and the National Bank of Georgia, a branch of a foreign enterprise, an individual entrepreneur, if they represent an enterprise of the third, second or first category.

Financial Statement
Financial statement of the enterprise of the fourth category shall be prepared according to the "simplified (temporary) standard for accounting for small enterprises" approved by the resolution N9 of April 5, 2005 of the Committee of Accounting Standards of the Parliament of Georgia. Enterprises of the fourth category are entitled to apply higher financial reporting standards (IFRS or IFRS for SMEs).

* If the respective legislative or normative act regulating activity of an enterprise envisages application of the higher financial reporting standards, an entity is obliged to follow the latter.

Enterprise of the fourth category is not required to ensure performance of the Audit of its financial statement, unless otherwise provided by Georgian legislation.

Periodicity of Preparation of Financial Statement
An enterprise of the fourth category shall prepare its Financial Statement at least once in a year.

Date of Reporting of the Financial Statement
An enterprise of the fourth category shall report its Financial Statement immediately, but not later than October 1st of the next year of the reporting period to the Service. If the reporting period of an enterprise doesn't coincide with the calendar year, an entity should report them to the Service immediately, but not later than 9 months from the end of the reporting period.

First Reporting Obligation
An enterprise of the fourth category shall report its Financial Statement of the financial year 2018 immediately, but not later than October 1st 2019.

 

Group
A parent company and all of its subsidiaries. The size category of a group is defined following total value of assets, income and an average number of employees during the reporting period calculated on a consolidated basis at the end of the reporting period of the parent company.

The criteria and the rules of the enterprise of the same size category apply to the consolidated financial/non-financial statements of the groups of the first, second and third category.

Groups of the first and the second category shall ensure performance of the audit of their consolidated financial statement for each reporting period. Groups of the third category are not required to ensure performance of the audit of their consolidated financial statement, unless otherwise provided by Georgian legislation.

Periodicity of Preparation of the consolidated financial/non-financial statements
Groups of the first, the second and the third category shall report their consolidated financial/non-financial statements at least once in a year.

Date of Reporting of the Financial/Non-financial Statements
A Group shall report its consolidated Financial Statement and consolidated Management Report immediately, but not later than October 1st of the next year of the reporting period to the Service. If the reporting period of an enterprise doesn't coincide with the calendar year, an entity should report them to the Service immediately, but not later than 9 months from the end of the reporting period.

First Reporting obligation
Groups of the first, the second and the third category shall report their consolidated Financial Statements and consolidated Management Report following the same rules set for the same size category enterprise.

 

Non-entrepreneurial (non-commercial) Legal Person
An organised entity created to accomplish a certain purpose that owns property, is independently liable with its own property, acquires rights and duties in its own name, enters into transactions and can sue or be sued and whose purpose is non-entrepreneurial (non-commercial) activity.

Reporting
Non-entrepreneurial (non-commercial) legal persons shall perform accounting and prepare their financial statement in accordance with "the temporary standard for accounting for non-entrepreneurial (non-commercial) legal persons and report plan structure for accounting" approved by the resolution N10 of Arpril 5, 2005, by the Committee of the Accounting Standards of the Parliament of Georgia.
Non-entrepreneurial (non-commercial) legal persons are entitled to apply higher financial reporting standards (IFRS or IFRS for SMEs).

Non-entrepreneurial (non-commercial) legal persons are not required to ensure performance of the audit of their financial statements, unless otherwise provided by Georgian legislation.

Periodicity of Preparation of Financial Statement
Non-entrepreneurial (non-commercial) legal persons shall prepare their Financial Statement at least once in a year.

Date of Reporting of the Financial Statement
Non-entrepreneurial (non-commercial) legal persons are not obliged to report their financial statement.