Italian Annual Accounts

Get an Annual Account

The first paragraph of new article 2423 of the Italian Civil Code requires that directors draw up the ordinary annual accounts for the year, consisting of:

• Statement of Assets and Liabilities
• Profit and Loss Account
• Financial Statement
• Additional Note.

The annual accounts be drafted in a clear and fair manner and must represent the company's assets and liabilities in a true and fair manner and the financial result for the year.

The ordinary annual accounts concern the Companies that issued securities traded on regulated markets or exceeded the limits to prepare the annual accounts in an abbreviated form.

The short annual accounts may only be drawn up by joint stock companies that, during the first financial year or, following that, for two consecutive financial years, have not exceeded two of the following limits (small enterprises):

• total assets in the Statement of Assets and Liabilities: 4,400,000 €
• revenue from sales and services: 8,800,000 €
• average number of employees during the financial year: 50 persons.

The short annual accounts consists of:

• Statement of Assets and Liabilities
• Profit and Loss Account
• Additional Note.

Companies that are classified as small enterprises can still present an ordinary annual accounts.

Micro-enterprises are those companies that, during the first financial year or, following that, for two consecutive financial years, have not exceeded two of the following limits:

• total assets in the Statement of Assets and Liabilities: 175,000 €
• revenue from sales and services: 350,000 €
• average number of employees during the financial year: 5 persons.

Micro-enterprises are exempt from the need to draw up:

• the Annual Accounts
• the Additional Note

when the information envisaged by the first paragraph of art. 2427 of the Italian Civil Code, No. 9 (the overall amount of obligations, guarantees and potential liabilities not resulting from the Statement of Assets and Liabilities) and No. 16 (the sum of remunerations, advances and credits granted to directors and auditors) appears at the foot of Statement of Assets and Liabilities;

and they are exempt from presenting a management report

when the information required by art. 2428 of the Italian Civil Code, No. 3 (the number and nominal value of both own stocks and stocks or shares in parent companies held by the company) and No. 4 (the number and nominal value of both own stocks and stocks or shares in parent companies acquired or transferred by the company during the financial year) appears at the foot of the Statement of Assets and Liabilities.

Consequently, the Annual Accounts for micro-enterprises can consist only of the Statement of Assets and Liabilities and the Profit and Loss Account, for which the form, structure and contents must be the same as those for the short annual accounts. If companies that can be classified as micro-enterprises wish to present an annual accounts complete with Additional Note and Financial Statement, they must draw up and file the annual accounts in short form, using the relevant taxonomy.

Just like small enterprises, micro-enterprises are also entitled to present an ordinary annual accounts.

Preparation of the winding-up statement is the final accounting requirement for businesses that are being put into liquidation. Once all the winding-up operations have been carried out, the liquidators are required to draw up the winding-up statement, indicating the part due to each partner or share when the assets are distributed.

Legislation does not require winding-up statements to be drawn up in such a strict form as is the case for the Annual Accounts. This means there is a certain amount of freedom when it is drawn up, with the sole requirement being that any remaining capital after winding-up of the company be shown and that the final shares due to each of the partners be indicated.

To be complete, the accounting document must:

• quantify the final assets available for distribution
• set out the distribution plan, highlighting the right of partners to the winding-up shares
• allow the control bodies to express their opinion.

Once the winding-up statement has been prepared, the liquidators must fulfil the legal advertisement requirements, so as to allow partners to make claims before the Court within the term of ninety days. The final winding-up statement does not have to be approved by the Meeting of shareholders, but, unlike the annual financial statement, it is presumptive, so that in the absence of any complaints by partners within the terms indicated in article 2493 of the Italian Civil Code the statement will be approved.