New Serbian accounting law

The Ministry of Finance of Serbia has drafted a new Accounting Law to replace the one of 2019. Together with a new draft Audit Law, it is designed to bring the country closer to European Union reporting standards ahead of accession.
They expect most of the new rules to come into force from 2027 and the heaviest new obligations to push out to 2030.
In general, the law divides companies into micro, small, medium and large.
The first change concerns the revenue ceilings: the thresholds increase to nearly €900,000, €10 million and €50 million.
The second change is based on “net operating revenue” — only the sale of goods, products and services. It leaves out subsidies, changes in inventory and capitalized work. Some companies could think that it means dropping into a lower category and a lighter reporting burden for them.
Nevertheless, the mandatory-audit threshold stays at total revenue above €4.4 million, according to the draft Audit Law.
In reality, large entities, listed and public-interest entities, and parent companies that prepare consolidated accounts would apply full IFRS. Small and medium companies will have the option to move up to full IFRS, but would use IFRS for SMEs. A national rulebook built on general accounting principles will be mandatory for micro entities, with the option of IFRS for SMEs. The framework for most mid-sized firms will not change.
According to the EU’s Corporate Sustainability Reporting Directive, large and public-interest entities would have to disclose environmental, social and governance information on a “double materiality” basis. It means they must report how sustainability issues affect the business and how the business affects people and the planet. Also, large multinational groups will have to report income tax publicly country-by-country.
Nevertheless, these obligations will begin only in 2030. Only Serbian subsidiaries of EU groups already face the CSRD at group level.
Many Serbian companies entrust their accounting to an external agency. So, accounting-service providers would have to carry mandatory professional-liability insurance, with a minimum sum tied to their prior-year fee income. It will be necessary to undergo continuous verification that they still meet licensing conditions, at their own cost. Another task is to complete ongoing professional training at designated bodies. Finally, additional data about their clients must be filed.
These costs will show up in fees for the businesses.
Also, day-to-day administration will undergo a few changes. Firstly, not only the legal representative but also the people responsible for preparing financial statements would have to sign them. Secondly, the deadline for submitting and recording accounting documents would move from five to eight working days. Finally, they will spell out retention periods: 20 years for financial statements and annual reports, 10 for the journal and general ledger, five for auxiliary ledgers.

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