Chapter eight
CERTIFIED ACCOUNTANTS

(1)

 ³⁸ Any Bulgarian national with high education and professional experience, who has the necessary qualifications, has not been convicted to imprisonment for a premeditated offence of a general nature, unless subsequently rehabilitated, and whose name has been included in the register of certified accountants may be a certified accountant.

(2)

New entries and changes in the register of certified accountants shall be promulgated in the State Gazette within one month of their occurrence.

(3)

 ³⁹ The annual reports of enterprises shall only be audited by certified accountants or by specialised auditing enterprises.

(4)

 ⁴⁰ A specialised auditing enterprise may only be a commercial company under Art. 64, par. 1, items 1, 2, and 3 of the Commerce Law, with a registered office in the Republic of Bulgaria, and with the following object of activity: auditing and verification of annual financial reports of enterprises and other activities related to practising accounting of enterprises; in which at least 51 per cent of the capital and the voting power in decision making is held by certified accountants or by certified accountants and foreign nationals who have been certified as having the competent right to audit and verify annual financial reports under the respective national legislation.

(5)

 ⁴¹ The competent right of foreign nationals to audit financial statements under the Bulgarian law shall be acknowledged by the Institute of Certified Accountants upon their successfully taking examinations such as are required also of the Bulgarian certified accountants.

(6)

 ⁴² The Institute of Certified Accountants shall promulgate in the State Gazette by 31 March of each year a listing of certified accountants and specialised auditing enterprises.

(1)

 ⁴³ Annual reports of the following enterprises shall be liable to a mandatory audit and verification by a certified accountant or a specialised auditing enterprise:

1. joint stock companies;
2. Partnerships limited by shares;
3. Banking, insurance and other financial institutions not included under items 1 and 2;
4. ⁴⁴
5. Any other enterprises (including economic groups drawing up consolidated reports) provided they show results exceeding at least two of the following criteria:
   1. (Amended, SG No.83/1999) total balance sheet assets as of the previous accounting year - BGN 300 000;
   2. (Amended, SG No.83/1999) net amount of sales revenue and financial income for the previous accounting year equal to BGN 600 000;
   3. average number of employees for the previous year equal to 30.
6. ⁴⁵Co-operatives.

(2)

 ⁴⁶ The annual report of government budget-funded entities and enterprises shall not be subject to auditing by a certified accountant or a specialised auditing enterprise. These shall be audited by the National Audit Office.

(3)

 ⁴⁷ The verification fee shall be determined through negotiation. The Council of Ministers determines fees for the verification of annual reports of enterprises in which the state interest is larger than 50 per cent.

(1)

 ⁴⁸ An Institute of Certified Accountants is hereby established as a self-sustained legal entity domiciled in Sofia. All certified accountants exercising their right to verify annual financial reports directly or through specialised auditing enterprises shall be, by statute, members of the Institute.

(2)

The Institute shall organise and guide the activity of its members and that of the other certified accountants with regard to training and methodology, and shall ensure that they perform in their profession in the interest of the society.

(3)

 ⁴⁹ The auditor profession is a self-regulated profession within the framework set by the law. The Institute of Certified Accountants shall develop national standards for auditing and verification of annual financial reports, which shall be promulgated in the State Gazette.

(4)

The Institute of Certified Accountants shall have the following bodies:

1. General Assembly;
2. Executive Board;
3. Supervisory Board;
4. Disciplinary Commission.

(5)

The General Assembly:

1. elects the Executive Board and its President;
2. elects the Supervisory Board;
3. adopts the by-laws of the Institute of Certified Accountants.
4. ⁵⁰ adopts a Professional Code of Ethics of certified accountants.

(6)

The Disciplinary Commission is appointed by the Minister of Finance upon a nomination from the Executive Board.

(7)

 ⁵¹ Members of the Institute of Certified Accountants shall pay an entry membership fee upon the approval of their membership to the amount of BGN 80, and annual membership dues to the amount of BGN 250.

(8)

 ⁵² A certified accountant shall take out an insurance against the risks of his profession activity. The minimum of the insurance amount shall be set by the Institute of Certified Accountants.

(1)

 ⁵³ On the basis of the audit of the annual financial report of an enterprise, the certified accountant, or the specialised auditing enterprise, respectively, shall expresses an independent opinion with regard to the true and fair picture of the material and the financial condition of the enterprise, the financial result obtained, and the changes in cash flows, in compliance with national accountancy law and professional auditing standards.

(2)

 ⁵⁴

(3)

 ⁵⁵

(4)

A certified accountant may not perform verifications of annual financial report of enterprises when:

1. ⁵⁶ he is engaged on a labour contract, except with the Institute of Certified Accountants, with a commercial company established by certified accountants where the purpose of its business activity is to perform verification of annual financial reports, or when engaged in academic research and training;
2. he, his parent, spouse, son, daughter, or the spouse thereof, has been elected or appointed in the management of the enterprise, or a subsidiary thereof, or is a shareholder or partner therein.

(5)

 ⁵⁷ The right of certified accountants to be auditors of enterprises shall not be rescinded when they are:

1. holders of shares in the enterprise, except when participating in the enterprise management;
2. creditors to the enterprise.

(6)

 ⁵⁸ A specialised auditing enterprise or a certified accountant may not, directly or indirectly - through related persons, perform an audit and verification of the annual financial reports of enterprises, if they perform the accounting of those enterprises in the meaning of Art. 50.

(7)

 ⁵⁹ Certified accountants shall verify annual financial reports on their own behalf with their personal signature and seal.

(8)

 ⁶⁰ Specialised auditing enterprises shall verify annual financial reports on the behalf of their enterprise with the company seal of the said enterprises, and the reports shall be signed by the manager and the certified accountant who has performed the audit.

(9)

 ⁶¹ In the verification of annual financial reports, the signature and seal shall be placed onto all components, except for the annexes, and an report shall be drawn confirming auditor verification, verification with reserves, or refusal to grant verification.

(10)

 ⁶² Publications of the annual financial report shall indicate the name of the certified accountant or the specialised auditing enterprise that have performed the verification, and the conclusion of the auditor's report.

Certified accountants and specialised auditing enterprises shall be held liable for any material damages they may have caused to their trustees, if such damages are, directly or indirectly, the consequence of their purposeful actions or failure to take action. Certified accountants and specialised auditing enterprises shall not be held liable under court claims for any damages ensuing from the legal obligations of the auditor.

On the application of this Chapter, a regulation shall be issued by the Institute of Certified Accountants, which is subject to approval by the Council of Ministers.

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Aufwärts: Law on Accountancy
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