Until the publication of MF Order 4291/2022 (published in MO no.18/06/01/2023), the accounting regulations only contained details on the accounting of interim dividends to companies distributing them.
In view of this, the Ministry of Finance (MF) made formal additions to establish the accounting of interim dividends also at the companies receiving them.
Please note that the new provisions are introduced both in the accounting regulations on individual annual financial statements and consolidated annual financial statements (MF Order 1802/2014) and in the accounting regulations compliant with International Financial Reporting Standards (MF Order 2844/2016).
We emphasize that the new provisions are valid starting with the financial statements for the year 2022, but entities that have chosen a financial year different from the calendar year apply the provisions starting with the first annual financial statements closed on a date later than 1 January 2023.
- Dividend accounting – changes introduced by OMF4291/2022 (for entities receiving dividends):
Specifically, a completely new provision has been introduced which stipulates that entities receiving dividends must recognise the corresponding amounts as liabilities:
461 “Sundry debtors”/separate balance sheet = 467 “Liabilities relating to interim dividend distributions”.
These amounts are settled on the dividends due on the basis of the approved annual financial statements of the entity which has elected to distribute dividends during the financial year:
- in the case of the accounting rules for financial statements – accounting items 461 “Sundry debtors” = 761 “Income from financial fixed assets” and 467 “Liabilities relating to interim dividend distributions” = 461 “Sundry debtors”/separate annual accounts;
- in the case of accounting regulations in conformity with international standards – accounting item 467 “Liabilities related to interim dividend distributions” = 461 “Sundry debtors”/separate analytical item.
In practice, account 467 “Interim dividend payables” (among other new accounts) has appeared in the chart of accounts.
Account 467 “Interim dividend payables»:
The account 467 “Liabilities related to interim dividend distributions” is used to keep track of the dividends received as a result of distributions made, in accordance with the law, during the financial year and to be settled after the communication of the dividends established on the basis of the annual financial statements.
Account 467 “Interim dividend payables” is a liability account
The credit of the account 467 “Liabilities related to interim dividend distributions” records the amount of dividends received following interim dividend distributions (461).
The debit of the account 467 “Liabilities relating to interim dividend distributions” records the amount of dividends received as a result of interim dividend distributions and settled on account of dividends due on the basis of the annual financial statements (461).
The balance of the account represents the amounts received as dividends, following interim dividend distributions made, according to the law, during the financial year.
- Dividend accounting – existing regulations (for entities distributing dividends):
We remind you that entities that have opted, according to the law, to distribute dividends during the financial year, record that distribution in account 463 “Receivables representing dividends distributed during the financial year” :
463 “Dividend receivables distributed during the financial year” = 456 “Shareholder/partnership capital settlements”.
Distributed dividends are accrued on the dividends distributed on the basis of the annual financial statements approved by law:
457 “Dividends payable” = 463 “Receivables representing dividends distributed during the financial year”.
Legal basis:
– MF Order no. 4291/2022 for the regulation of some accounting aspects;
– MFP Order no. 1802/2014 for the approval of the Accounting Regulations regarding individual annual financial statements and consolidated annual financial statements.