Ministry of Finance (MF) Order no.2048 on the completion of the accounting regulations applicable to economic operators was published in the Official Gazette (Part I) no.878 of 7 September 2022.
According to the document, a certain category of companies will have to publish an annual report on the corporate income tax paid in each Member State of the European Union. Please note that the new rule will apply from 1 January 2023, so the first such reports will have to be published after that year.
We mention that Order 2048//2022 transposed into national law European Directive 2101/2021, which established that multinationals and autonomous enterprises must prepare and publish a report with information on corporate income tax if they obtain revenues of more than approximately 750 million euros in each of the last two consecutive financial years.
The new normative act amends both the accounting regulations on individual annual financial statements and consolidated annual financial statements (Order 1.802/2014) and the accounting regulations in accordance with International Financial Reporting Standards (Order 2.844/2016).
According to Order 2048, “ultimate parent companies, whose consolidated net turnover exceeded at their balance sheet date, for each of the last two consecutive financial years, the amount of RON 3,700,000,000 (equivalent to 747,474. 740 at the exchange rate published in the Official Journal of the European Union on 21 December 2021), as reflected in their annual consolidated financial statements, are obliged to prepare, publish and provide access to a report on information relating to corporate income tax for the most recent of those two consecutive financial years.
Autonomous entities whose net turnover has exceeded at the date of their balance sheet, for each of the last two consecutive financial years, the amount of 3,700,000,000 lei, as reflected in their individual annual financial statements, are obliged to prepare, publish and provide access to a report on information relating to corporate income tax for the most recent of those two consecutive financial years”, according to the new order, with reference to the accounting regulations on individual annual financial statements and consolidated annual financial statements.
Specifically, that report should include information on all the activities of the ultimate parent or autonomous entity, including the activities of all related entities, consolidated in the financial statements for the financial year in question. This includes, but is not limited to, revenue, profit or loss, income tax paid, or number of employees.
It is important to note that the report must be published online within 12 months of the balance sheet date of the financial year for which it is prepared.
The document will be available free of charge, in Romanian, for at least five consecutive years, on the websites of the companies concerned.
Almost identical information is provided for accounting regulations in line with International Financial Reporting Standards.
We underline that the new transparency obligation applies from the financial year 2023. In the case of entities that have chosen a financial year different from the calendar year, the new provisions apply from the beginning of the first financial year so chosen, which begins after 1 January 2023.