Private companies that have, on average, over 500 employees during the financial year have to submit, together with the annual financial statements for 2019, also a non-financial report that includes information on at least the environmental, social and personnel aspects, respecting the rights of man, combating corruption and bribery.
This reporting is done for the first time this year by the private companies with over 500 employees, it being mandatory in the past only for the state ones.
We remind that the non-financial statement was introduced by the Ministry of Public Finance (MFP) Order no. 1456/2018 regarding the modification and completion of some accounting regulations, published in the Official Gazette no. 942 dated November 7, 2018, with applicability from January 1, 2019.
Through this document, the Ministry of Public Finance (MFP) extended in 2018 the obligation to submit, together with the annual financial statements, a non-financial statement to several categories of companies.
We mention that until the appearance of the Ministry of Public Finance (MFP) Order no. 456/2018, the obligation to submit the non-financial declaration was only the companies of public interest that have, on average, during the financial year, over 500 employees.
Starting with 2019, the obligation also rests with the private companies that meet the criteria of the number of employees. Thus, the non-financial statement must first be submitted in 2020 by these companies, together with the balance sheets for 2019.
“The entities that, at the balance sheet date, exceed the criterion of having an average number of 500 employees during the financial year include in the directors’ report a non-financial statement that contains, to the extent that they are necessary for understanding the development, performance and position of the entity and of the impact of its activity, information on at least the environmental, social and personnel aspects, respecting human rights, combating corruption and bribery, including ”, according to the Order specifications.
According to point 4921, paragraph (1) of the Regulation of the Ministry of Public Finance OMFP no.1802 / 2014, with the subsequent modifications and completions, the non-financial statement also includes the following aspects
- brief description of the business model of the company;
- description of the policies adopted by the company in relation to the aspects mentioned in the
quotation, including the due diligence procedures applied;
- the results of the respective policies;
- the main risks related to the quoted aspects arising from the operations of the company,
including, when relevant and proportionate, its business relations, its products or services that
could have a negative impact on the respective fields and the way in which the entity manages
the respective risks;
- key non-financial performance indicators relevant to the specific activity of the company.
In cases where the entity does not implement policies regarding one or more of the aforementioned aspects, the non-financial statement provides a clear and reasoned explanation regarding this option.
The non-financial statement mentioned contains, as the case may be, references and additional explanations regarding the amounts reported in the individual annual financial statements.
The information regarding the imminent developments or the aspects under negotiation can be omitted in exceptional cases where, according to the duly justified opinion of the members of the administrative, management and supervisory bodies, which act within the limits of the powers conferred by the national legislation and bear a responsibility. collective for the respective opinion, the presentation of this information would seriously damage the commercial position of the entity, provided that these omissions do not prevent a correct and balanced understanding of the development, performance and position of the entity and the impact of its activity.
It is worth mentioning that when requesting the presentation of the information mentioned in point 4921 paragraph (1), entities may be based on national, EU or international entities. In this case, the entities specify the frameworks on which they are based.
The non-financial statement must contain, with regard to the environmental aspects, details on the current and predictable impact of the entity’s operations on the environment and, as the case may be, on health and safety, the use of renewable and non-renewable energy, the gas emissions with effect of greenhouse, water use and air pollution.
Regarding human rights, combating corruption and bribery, the non-financial statement may include information on preventing human rights abuses and / or on the instruments established to fight corruption and bribery.
The non-financial statement also includes the consequences on the climate change of the entity’s activity and the use of the goods and services it produces, as well as on its commitments in favor of sustainable development, the fight against food waste and in the fight against discrimination and to promote diversity.
Attention! The accounting regulations specify that the information requested according to the provisions of this point are not limiting.
The non-financial statement must be included by the large private companies in the management’s report.
The management report, which must be prepared by the board of directors for each financial year and which forms part of the annual balance sheets, is “a faithful presentation of the development and performance of the activities of the entity and of its position, as well as a description of the main risks and uncertainties with which it is is confronted ”, according to the Ministry of Public Finance (MFP) Order no. 1802/2014.