The Account Approval Process

Given the period of the year in which we find ourselves, the corporate life of companies is subject to annual obligations such as the accounts approval process.

This process, in summary, consists of the following:

Duty to report and present accounts;

As a rule, the management report, financial statements and other documents must be presented to the competent body and assessed by it within three months from the closing date of each annual financial year, that is, by March 31st. 2024.

Although it is not mandatory, as a general rule, the annual exercise corresponds to the entire calendar year.

Call General Assembly;

The General Account Approval Meeting must be called by any of the managers and must be done by registered letter, sent at least fifteen days in advance, unless the law and the articles of association require other formalities or deadlines. longer, and the management report and financial statements must be made available to shareholders, at the company’s headquarters, from the day the call for the Assembly is issued (in the case of limited liability companies).

As far as public limited companies are concerned, the general meeting is called by the chairman of the board, except for specified exceptions. It should be noted that the notice must be published, unless all shares of the company are nominative, and publications may be replaced by registered letters, or, in relation to shareholders who previously communicate their consent, by email with receipt of reading. Now, between the last disclosure and the date of the assembly meeting there must be at least one month, and between the dispatch of the registered letters or mail messages referred to above and the date of the meeting, there must be at least twenty days. Finally, during the fifteen days prior to the date of the general meeting, the documents referred to in point 5 must be made available for consultation by shareholders at the company’s headquarters.

Lack of presentation of accounts;

If the management report, financial year accounts and other financial reporting documents are not presented within two months following the end of the fixed period (three months from the closing date of each annual financial year), any partner may petition the court that the investigation be carried out.

Refusal to approve accounts;

If the proposal of the members of the administration/management regarding the approval of accounts is not approved, the general meeting must decide with reason to proceed with the total preparation of the new accounts or the reform, in specific points, of those presented.

Accountability;

Information regarding the financial year accounts and other reporting documents, duly approved, is subject to commercial registration, in accordance with the respective law.

The company must make available to interested parties, free of charge, on its website, where it exists, and at its headquarters a full copy of the following documents:

Management report;
Report on the structure and corporate governance practices, when it is not an integral part of the document referred to in the previous paragraph;
Legal certification of accounts;
Opinion of the supervisory body, if any.

The presentation of the accounting record is made with the delivery of the IES (Simplified Business Information), as a rule, it is carried out by the 15th (fifteenth) day of the seventh month following the closing date of the annual financial year.

Consequences.

In addition to the consequence referred to in point 2), failure to comply with deadlines may result in the impossibility of distributing dividends to partners and, also, in the refusal of registrations at the Commercial Registry Office until the deficiency is met, which is the legal deposit of accounts .

CRS has a specialized team in this area and is available for additional clarification if necessary.