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The Law on Accounting (valid from 1 January 2003) regulates basic accounting functions in all business entities registered in Estonia. It does not regulate accounting for taxes, which are regulated by other laws and acts. The essence of the law is framed in compliance with International Accounting Standards (IAS).
Almost all Estonian companies can choose whether to prepare their consolidated and annual accounts in accordance with International Financial Reporting Standards (IFRS) or in accordance with the Estonian accounting standards ("Estonian GAAP"). Listed companies and financial institutions are required to prepare their accounts in accordance with IFRS. The Estonian GAAP is written by the Estonian Accounting Standards Board.
The length of a financial year is 12 months. At the end of each financial year, an accounting entity is required to prepare an annual report that consists of the annual accounts and the management report. The auditor's report and, in the case of a company, the profit distribution proposal for the financial year should be annexed to the annual report. The auditor's report need not be annexed to the annual report if auditing is not compulsory.
Annual report should be filed at the Commercial Register during six months after the end of the financial year.
The financial statements should be audited for all public limited companies and foundations.
In addition to that an accounting entity should be audited if, at the balance sheet date of the accounting year, the accounting entity exceeds the limits of at least two of the three following criteria:
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sales revenue (net turnover), in the case of a company, or income, in the case of other accounting entities EUR 2 Million;
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total assets EUR 1 Million;
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or if the accounting identity exceeds the limit of one of the three following criteria:
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sales revenue (net turnover), in the case of a company, or income, in the case of other accounting entities EUR 6 Million;
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total assets EUR 3 Million;
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Additional information
Accounting Act: http://www.legaltext.ee/et/andmebaas/tekst.asp?loc=text&dok=X70008K4&keel=en&pg=1&ptyyp=RT&tyyp=X&query=raamatupidamise
Estonian Accounting Standards Board: http://www.easb.ee/?lang=en
Estonian Board of Auditors: http://www.audiitorkogu.ee
Central Commercial Register: https://ariregister.rik.ee
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