Proceedings

International Accounting Standards as adopted by the EU for keeping their accounts
and for preparation of financial statements”.
In addition, the IFRS can be applied in consolidated financial statements of non-listed
companies voluntarily (§23a, article 2).
No other entities were allowed to choose the IFRS on voluntary basis.
Act on accounting from 2011
After several years of effort by academics and practitioners, the Ministry of Finance
proposed an amendment of Act on accounting, which was approved by the Parliament
in 2010. Starting from 2011, companies specified by the Act are allowed to select the
IFRS as the basis for preparation of individual financial statements, which are
accepted for statutory purposes. Pursuant to the new §19a, articles 7 and 8, following
three groups of entities may opt to use the IFRS in their individual financial
statements:
• parent companies preparing consolidated financial statements in compliance
with the IFRS voluntarily pursuant to §23a, article 2;
• subsidiaries belonging to a consolidation group for which the consolidating
company prepares IFRS consolidated statements;
• joint ventures belonging to a consolidation group for which the consolidating
company prepares IFRS consolidated statements.
The amendment of the Act has changed the features of companies covered by
Category II (see their description further in the text). From 2011, the Category II
entities can opt whether to prepare two sets of financial statements (both CAS and
IFRS) or whether to prepare only one set of financial statements (just IFRS).
3.2 Issues regarding the implementation of Regulation (EC) 1606/2002
The adoption of IFRS in the EU has elicited new practical problems for companies
affected. Member states of the EU follow different paths when implementing
Regulation 1606/2002. Some countries have enacted only minimal requirements set
up by the Regulation, i.e. only the obligation to prepare consolidated financial
statements in compliance with the IFRS by listed companies; other countries have
broadened the scope to their individual statements. Compulsory or voluntary
application of the IFRS by non-listed companies is also possible in some countries.
Following approaches are preferred in selected countries:
• Compulsory IFRS application in consolidated statements of listed companies
(pursuant to EU Regulation) and simultaneously
� compulsory IFRS application in individual statements (e.g. Italy, Iceland,
Cyprus, Malta, Greece, Slovakia, the Czech Republic);
� compulsory application of local GAAP in individual statements (e.g.
Austria, Belgium);
� right of choice between local GAAP and IFRS in individual statements (e.g.
the Netherlands, Denmark, Ireland, Hungary).
• Compulsory IFRS application in consolidated statements of non-listed
companies and simultaneously
� compulsory IFRS application in individual statements (e.g. Cyprus, Malta).
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