This article will answer the following questions:

• What makes up net revenues from the sale of goods and products?
• When are businesses obliged to have their financial statements audited by a statutory auditor?
• What is the revenue threshold that brings a business under an obligation to keep full accounting records?

We are coming back to the topic initiated in the previous article regarding changes that have been incorporated under the amendment to the Polish Accounting Act. This time, we will discuss in more detail how the concept of "net sales revenues" has been unified (and how this affects its use, among others, to determine the existence of the obligation to keep accounting records and the possibility of applying accounting and reporting simplifications), and we will also outline new thresholds triggering the obligation to audit financial statements as well as new definitions of business entities (micro, small, medium, large), which are in force as of 1 January 2025. 

Changes in the definition of net sales revenue – new scope of the definition as of 1 January 2025

As a result of an amendment to the Polish Accounting Act, a new concept of "net revenues from the sale of goods and products" has been specified therein, by which the legislator understands:

a.  net revenues derived from the sale of goods and products, taking into account discounts, subsidies, rebates and other increases or decreases, excluding the goods and services tax and other taxes directly related to turnover – in the case of entities other than those specified in letters b-e;

b. revenues from contracts with customers referred to in the International Accounting Standards (IAS) - in the case of entities reporting under IAS;

c.  gross written premium – in the case of insurance and reinsurance companies;

d. the sum of items I, IV, VII, VIII and XI of the profit and loss account specified in Annex No. 2 to the discussed Act – in the case of domestic banks, branches of credit institutions and branches of foreign banks;

e. revenues within the meaning of the financial reporting framework employed by the entity on the basis of which the entity's financial statements are prepared – in the case of entities having their registered office or place of management outside the territory of the European Economic Area (EEA), referred to in Article 63zd(1)(1b), Article 63zd(1)(2a) and Article 63zd(1)(2b).

As for other operating revenues, as referred to in the Act, they include costs and revenues indirectly related to the entity's operating activities, in particular costs and revenues related to:

• social activity;
• the sale of materials, fixed assets, fixed assets under construction, intangible assets and legal rights, as well as real estate and intangible assets classified as investments.

The above constitutes a significant change in the presentation of the sale of materials, which was previously recognised as sales revenue and is now classified as operating revenues, which requires the adjustment of the entity's accounting policy and gives rise to the need to transform data (including comparative data) already for 2024 financial statements. For this reason – together with the amendment to the Act – new versions of reporting schemes were created.

New versions of financial statements schemes coming into effect in 2025

All information on the preparation and submission of electronic financial statements are available through Tax Portal. Additionally, the Ministry of Finance informs that the logical structures and formats of financial statements prepared under IAS will not currently be published in the Public Information Bulletin of the Ministry of Finance.

New definitions of business entities under the Accounting Act as of 2025

According to the Ministry of Finance, the new regulations provide more precise definitions of micro and small entities and clearly pinpoint the conditions for obtaining and losing the status of such entities, in order to be able to benefit from the application of reporting and accounting simplifications.

As of January 2025, the amended Act sets out new definitions of business entities. Whether a given business will be eligible to claim the simplifications envisaged in the Act will depend on the group to which the business is classified. 

The Ministry of Finance reminds that the simplifications listed in the Accounting Act apply to entities that, in the financial year for which they prepare their financial statements (and in the year preceding that financial year), did not exceed at least two of the three amounts indicated in the definition of a given group of entities.

In the case of business entities commencing business activity (or the maintenance of accounting records in the manner specified by the Act), it is the financial year in which they commenced business activity or started keeping accounting records in the manner specified by the Act that is taken into account.

The new thresholds apply for the first time to financial statements prepared for the financial year starting after 31 December 2023, i.e. for example to financial statements for the period from 1 January to 31 December 2024.

The decisions of the approving body which concern reporting simplifications and which were taken before the date of entry into force of the Act will remain effective for financial statements prepared for the financial year beginning in the period from 1 January 2024 to the day preceding the date of entry into force of the Act in question.

Amendments to the Polish Accounting Act and new thresholds for auditing financial statements

The amendment to the Act also introduces new thresholds which, once exceeded, oblige entities to have their financial statements audited by a statutory auditor. 

This obligation will now be imposed on entities that in the financial year for which they draw up the financial statements (and in the year preceding that financial year) met at least 2 of the 3 conditions:

• their total assets of the balance sheet prepared as at the end of the financial year exceeded EUR 3,125,000,
• the amount of net revenues derived from the sale of goods and products for the financial year exceeded EUR 6,250,000,
• the average annual employment counted on a full-time basis exceeded 50 employees.

In order to unify the concept of "net sales revenues" as referred to in the Act, the category of "revenues from financial operations" was abandoned, as part of the changes introduced as of 1 January 2025. Currently, this limit is determined by net revenues from the sale of goods and products.

The new thresholds apply for the first time to the financial year starting after 31 December 2024, and for the purposes of determining whether the conditions set out in these provisions have been met, the total assets of the balance sheet and net revenues from the sale of goods and products under Article 3(1)(30a) of the Polish Accounting Act, achieved in the previous financial year starting after 31 December 2023, are taken into account.

New thresholds – consolidation of financial statements

The amendments as of 1 January 2025 also affect the thresholds determining the obligation to consolidate financial statements. 

The provisions of the amended Accounting Act provide for certain exceptions that allow parent entities to claim an exemption from the obligation to prepare consolidated financial statements when the combined data of the parent entity and its subsidiaries as at the balance sheet date do not exceed at least two of the following three thresholds:

a. before exclusions:

• the threshold of PLN 48,000,000 – for total balance sheet assets,
• the threshold of 96,000,000 – for net revenues derived from the sale of goods and products,
• the threshold of 250 employees – for average annual employment counted on full-time basis, 

or

b. after exclusions:

• the threshold of PLN 40,000,000 – for total balance sheet assets,
• the threshold of PLN 80,000,000 – for net revenues derived from the sale of goods and products,
• the threshold of 250 employees – for average annual employment counted on a full-time basis.

The new thresholds apply for the first time to the financial year starting after 31 December 2023.

As of 1 January 2025, the threshold that triggers the obligation to keep accounting records will be 2.5 million of net revenue from the sale of products and goods

Pursuant to Article 3(3) of the Accounting Act, the threshold of EUR 2.5 million of net revenue expressed in euro is converted into Polish currency at the average euro exchange rate announced by the National Bank of Poland on the first business day of October of the year preceding the tax year.

The average euro exchange rate announced by the NBP on 1 October 2024 (the first business day of October 2024) was PLN 4.2846 and the new revenue limit for 2025 must be set according to this very rate.

This means that the limit for maintaining accounting records in 2025 will be calculated as 2,500,000,00 x 4.2846 – and will therefore ultimately amount to PLN 10,711,500.

As part of the unification of the concept of "net sales revenues" employed in the Act, the amendment abandoned the "revenue from financial operations" category. Currently, the limit for maintaining accounting records is determined by net revenues from the sale of goods and products.

The new threshold applies for the first time to the financial year starting after 31 December 2024, whereby for the purposes of determining compliance with the condition stipulated in these provisions, net revenues from the sale of goods and products under Article 3(1)(30a) of the Accounting Act, which were generated in the previous financial year starting after December 31, 2023, are taken into account.

Amendments to the Polish Accounting Act of 1 January 2025 – questions?

Our experts will be happy to answer any additional questions related to accounting and resolve any doubts resulting from the amendment to the Accounting Act as of 1 January 2025.

We would like to remind you that in our previous article devoted to the amendment to the Accounting Act of 6 December 2024, we discussed issues such as the new obligation imposed on businesses in terms of sustainable development (CSRD), outlined the principles of attestation of business reporting in the field of sustainable development and investigated the possibility of claiming an exemption from this obligation, and presented changes introduced to the Act on statutory auditors, audit firms, public supervision and certain other acts.