Investor Presentaiton
Different categories of accounting units dis-
close different information in their financial
statements (e.g. the cash flow statement and
the statement of changes in equity are manda-
tory for medium and large entities only; there
are different requirements for disclosures in
the notes, etc.).
The exact layout, structure and headings of the
balance sheet, the income statement and the
cash-flow statement are set in prescribed tem-
plates, and minimum disclosures in notes are
prescribed in the decrees. The extent of disclo-
sures in Czech accounting legislation is consid-
erably less demanding compared to IFRS.
A separate annual report must be prepared by
all accounting units that are subject to a man-
datory statutory audit.
A separate report on payments to governments
must be prepared by large entities and public
interest entities that are active in extractive
industries or in the logging of primary forests.
All accounting units with shares or bonds pub-
licly listed in the EU must maintain books and
prepare their financial statements in accor-
dance with IFRS, as adopted by the EU.
All other accounting units may choose to main
tain books and prepare their financial state-
ments in accordance with IFRS if they are con-
solidated by a parent or an ultimate parent
company in accordance with IFRS, or if they
have to consolidate, and if they prepare both
standalone and consolidated financial state-
ments in accordance with IFRS.
The Act on Accounting requires that consol-
idated financial statements be prepared for
an accounting unit that is a controlling entity.
Subsidiaries and accounting units over which
significant influence is exercised are deemed
consolidated accounting units.
The obligation to consolidate applies to
medium and large groups. Small groups must
consolidate only if they include a public inter-
est entity.
Consolidation is not obligatory where the con-
solidating entity is part of another consolidat-
ing entity that is governed by the law of an EU
member state, and where specific prescribed
conditions have been met. However, this rule
does not exempt from the obligation to pub-
lish consolidated financial statements as men-
tioned above. A Czech corporation using the
exemption not to consolidate has to translate
and publish the consolidated financials of its
parent or ultimate parent.
The above exemption from the duty to prepare
consolidated financial statements does not
apply to banks, insurers and reinsurers, and
publicly listed share or bond issuers.
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