Every year before the submission of annual reports, The Centre of Registers and Information Systems (RIK), that is responsible for the development of the e-business register, gathers information about the changes to the electronic reporting environment.
According to the RIK zero reporting team, changes to the reporting environment have been made in four main areas over the past year. The most notable change is that approximately 98% of the companies that fall under the micro-enterprise category can now submit abbreviated reports.
Furthermore, the signing stage of the report has been simplified in the portal with an added option of approval. Besides, an additional technical solution for submitting a report prepared outside of the system for listed companies has been created. Additionally, several smaller functionality additions and minor improvements have been made. More closely about the recent updates:
Based on the Accounting Act that came into effect in January of the ongoing year, changes in company categories were made. In addition to private limited companies other accounting entities can now also submit micro-reports.
From January 2025, the micro undertaking category includes accounting entities whose indicators on the reporting date do not exceed two of the conditions: total assets up to 450,000 euros, revenue during an accounting year is up to 900,000 euros; average number of employees during an accounting year up to 10 persons.
Micro and small undertakings that have chosen the Estonian Reporting Standard as a basis for their accounting policies may prepare an abridged report consisting of two main reports (balance and income statement) and annexes.
In the case of an abridged annual report, the balance statement is more detailed, which means that fewer mandatory annexes need to be prepared. A management report is only required if the company’s net assets do not meet the requirements set out in law.
Even though the micro undertaking category has been expanded, companies can continue to compile a more comprehensive annual report.
From this year non-commercial entities (including non-profit organizations, apartment associations, foundations) must also select a category for submitting annual reports. If the conditions overlap, the micro and small undertaking category can also be selected for these legal forms and an abridged report can be submitted. To submit the report in its previous form a medium-sized undertaking category must be selected.
More detailed conditions for company categories can be found on the e-Business Registers help page.
Starting from this year, the options for signing annual reports have been simplified. In the report submission portal an additional signing method, electronic approval, can be chosen at the signing stage.
It is now possible to use the option of electronic approval for reports prepared on the portal, as it was previously only available for paper-signed and electronically scanned reports.
To approve the report, a board member must authenticate themselves when entering the portal. The rules for approval are similar to digital signing – the report must be approved by at least one board member if the statute does not specify the representation rights.
The new signing alternative makes the preparation, approval and electronic submission of the report more convenient for citizens of other countries, who until now have had to upload a PDF report to the reporting environment. To approve the annual report foreign citizens can authenticate themselves via eIDAS. Should there be any problems with authentication the previous option for submitting a paper-signed and scanned report remains.
If the report must be audited, reviewed or revised, a digital signature is still mandatory when submitting the report electronically.
The requirements for audit obligations have been raised for those who must undergo an audit or inspection and include a sworn auditor’s report.
For the audit of the annual report the average number of employees has remained the same. However, the thresholds for revenue and assets on the balance sheet date have changed. For example, an audit or review is mandatory if at least two of the indicators presented on the annual report exceed the following conditions: revenue in the case of an audit 5,000,000 euros, in the case of a review 2,000,000 euros; assets on the balance sheet date in the case of an audit 2,500,000 euros, in the case of a review 1,000,000 euros; average number of employees in the case of an audit 50 persons, in the case of a review 24.
An audit is also mandatory if at least one of the indicators reported in the annual report exceeds the following conditions: revenue in the case of an audit 15,000,000 euros, in the case of a review 6,000,000 euros; assets on the balance sheet date in the case of an audit 7,000,000 euros, in the case of a review 3,000,000 euros; average number of employees in the case of an audit 180 persons, in the case of a review 72.
The audit and review rates apply retroactively to reporting periods and beginning on or after the 1st of January 2024, and to the reports prepared on them.
In addition to importing the report as a PDF document, the reporting portal has created an option for those obliged to submit sustainability reports (listed companies) to submit reports in machine-readable iXBRL format prepared outside the system, which must be digitally signed by the parties in advance.
A container digitally signed by the auditor can also be imported into the reporting environment. When importing the file, it is checked whether the report has been digitally signed by a member of the management board. The annual report can then be approved in the portal and submitted to the register.
There is also news on the topic of data-based reporting. As of April, this year, some financial and accounting software providers can already offer their users a solution that sends the basic data of the report to the reporting portal and automatically pre-fills the forms for the entrepreneur.
For now, four software programs are piloting the new technical solutions system, but going forward, other accounting software programs will also be able to interface with the e-Business Registers reporting environment to reduce the volume of routine work and the time spent on reporting. This, in turn, will allow accountants to submit data from several reports at once and focus more on the analysis and forecasts of the company's financial results in the future. Specific information on data-based reporting will be shared in mid-April.