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Higher Thresholds for Financial Statement Audits in Poland from January 1, 2025!

31.12.2024

In 2025, the thresholds of financial statement audits for other entities will be higher in Poland. What will the new limits be and what should you do if the company is no longer subject to the obligatory audit of financial statements?

 

On January 1, 2025, the Polish government will implement the Act of December 6, 2024, amending the Accounting Act, the Act on Statutory Auditors, Auditing Companies, and Public Supervision, along with certain other acts. The said amendment adds, among others, new thresholds for the audit of financial statements for other entities (above all: limited liability companies, general partnerships, professional partnerships, limited partnerships, civil law partnerships, and undertakings of natural persons) which in the preceding financial amount, respectively:

  • total of balance sheet assets at the end of the financial year – EUR 3,125,000,
  • net revenue on sales of goods and products for the financial year – EUR 6,250,000,
  • average annual employment calculated as full-time equivalents – 50 people.

The new thresholds will apply for the first time to the financial year starting after 31 December 2024. If an entity meets at least 2 of the above-mentioned conditions for 2024, it will be obligated to carry out an audit of the financial statement for 2025.

 

As a reminder, by the end of 2024, the above-mentioned thresholds were as follows:

  • the total of balance sheet assets at the end of the financial year constituted the equivalent of EUR 2,500,000 in PLN (PLN 10,870,000),
  • net revenue on sales of goods and products and financial operations for the financial year constituted the equivalent of EUR 5,000,000 in PLN (PLN 21,740,000),
  • the average annual employment calculated as full-time equivalents was at least 50 people.

Important note! Revenue on financial operations was removed from the revenue category. It means that apart from the assets total and the employment, the obligation to carry out an audit of the financial statement is determined by operating revenue i.e., the revenue that the entity was established for and that is related to its basic business.


 

Termination of the financial statement audit agreement due to increased thresholds

Because of the higher thresholds, some of the entities will no longer be covered by the obligatory audit of financial statements. Agreements with auditing companies are concluded for a period of at least two years. There might be then a situation when a company is subject to an obligatory audit of the financial statement for 2024 but with the higher thresholds it will be exempted from such obligation in 2025. If it happens, the entity can terminate the agreement for the audit of the financial statement. It is necessary to inform the Polish Agency of Audit Supervision (PANA) about the termination. This should be done by the audited company and the auditing company. In case of a public interest entity (pursuant to Art.  2 point 9 of the Act on statutory auditors, auditing companies and public supervision) the information about termination of the agreement should also be delivered to the Polish Financial Supervision Authority (KNF).

The information about termination of the agreement can be filed to the Agency in the following way:

 

Need Professional Support with Financial Reporting? The experts at MDDP Outsourcing are here to provide your company with comprehensive support! Our services include reporting, accounting, and payroll solutions tailored to your needs. Feel free to contact us today!

 

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