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IFRS – it is worth starting preparation in time

Certain Hungarian enterprises may already opt for bookkeeping according to IFRS (International Financial Reporting Standards) from 2016, while the number of IFRS transitions is expected to increase significantly as of 2017 onwards.

The local IFRS implementation definitely simplifies the life of corporations that operate in an international environment; provide better market potentials and also easier administration. As of 2017, every company that is obliged to statutory audit or as part of an international group where its parent consolidates according to IFRS may introduce IFRS accounting as well. This is expected to be the biggest group of IFRS appliers. 

Given the fact that migrating an accounting system is a serious task, it is worth preparing the expected effects in advance. It is already advisable to start IFRS bookkeeping in the pre-launch period, especially because the financial figures of the two preceding years must be presented according to IFRS as well.

The condition of the changeover is an audit report. which proves that the company is prepared for the IFRS implementation. This certifies that the company has IFRS qualified employees (or outsourced service providers) for the accounting and preparation of the financial statements, maintains an accounting policy under IFRS, possesses its balance sheets according to IFRS for the year before changeover. The changeover must be reported to the Hungarian tax and financial authorities at least 90 days before the transition to IFRS with the auditor’s report attached.

Therefore, preparations cannot begin early enough, and during such a long and complex process, professional accompaniment and consultation will be needed. Providing IFRS qualified employees may cause the biggest problem for many companies. The involvement of an experienced outsourced contractual partner, such as LeitnerLeitner’s team may provide for a solution in this. We can help in the preparation phase and in the accounting under IFRS as well.

With Austrian headquarter LeitnerLeitner is one of the market leading advisory firms in the field of taxation, accounting and audit services in Central Europe.