Increase of limits for categorisation of accounting entities and groups

The Chamber of Deputies is currently considering a draft amendment to Act No. 563/1991 Coll., on Accounting. The main topic is, among other things, the approval of the proposed increase in the limits for the categorisation of accounting entities and groups. At the same time, the conditions for the audit obligation, i.e. the verification of the financial statements by the auditor, are adjusted.

The increase in the limits relates to the value of assets and annual aggregate net turnover, while the average number of employees remains unchanged. The changes would affect all categories of entities.

The increase in the limits (according to the submitted draft amendment) will probably be as follows:

• Micro accounting entity: assets up to CZK 11 million, net turnover up to CZK 22 million
• Small accounting entity: assets up to CZK 120 million, net turnover up to CZK 240 million
• Medium-sized entity: assets up to CZK 600 million, net turnover up to CZK 1.2 million 

At the same time, the proposal states that the audit obligation should apply only to medium and large accounting entities, i.e. small accounting entities would be exempted from the obligation, according to the categorization of accounting entities.

The proposed effectiveness of this amendment is from 1 January 2026.

We will keep you informed of further developments.