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  • Service: Tax
  • Type: Regulatory update, Survey report
  • Date: 1/1/2014

Slovenia - Accounting 

International funds and fund management survey
1.1 Requirement to produce financial statements
1.2 Requirement to audit financial statements
1.3 Publication of financial statements
1.4 Accounting standards
1.5 Contents of financial statements
1.6 Accounting treatments and disclosures
1.7 Appendix 1
1.8 Appendix 2


1.1 Requirement to produce financial statements

Requirement to maintain the books and records in the local jurisdiction


According to Slovene legislation the maintenance of bookkeeping documents, books of accounts, and financial statements are, in general, governed by the provisions of Slovene Accounting Standards (SAS). Books of accounts and records can be kept in the territory of Slovenia, in the Slovene language, and in the Slovene currency, the Euro (EUR). Books can also be kept abroad and in other languages.


The storage duration of books of accounts, financial statements, and other documents connected with the financial statements is usually set out in the company’s internal act, which must be in compliance with the provisions of other legal Acts such as the Taxation Procedure Act or VAT Act.


A company must use certified computer programs for computerized books of accounts.


Production of financial statements by collective investment funds


The management company can be either a limited liability company or a joint-stock company, under the Slovene Companies Act. The management company manages investment funds based on a license granted by the Securities Market Agency.


One of the main administrative services of the management company is to:


  • maintain books of accounts, keep records, and prepare annual reports of the investments funds under management
  • report and publish information about the investment funds.

The management company is required to prepare the investment fund’s annual and interim report in accordance with the provisions of the Act on Investment Funds and Fund Management Companies and in accordance with the Decision on the Contents of the Annual and Interim Reports of Investment Funds.


The management company also has an obligation to report to the Securities Market Agency on a monthly basis on:


  • the type and structure of the investments within the funds
  • the net asset value of the investment funds.

The management company is obliged to report information about the net asset value per unit of each mutual fund under management to the Securities Market Agency on a daily basis. This data also has to be published in a daily newspaper.


A director or another authorized person of the management company is obliged to sign all financial statements including all reports that have to be prepared and published on a daily or monthly basis.


Choice of period/year-end for collective investment funds


The annual report of an investment fund has to be prepared for a period equivalent to the calendar year. An interim report has to be prepared for the first six months of each year.


Requirement for comparatives


Comparatives are required for the financial statements. If a different accounting treatment or valuation method was used in the previous period, this should be disclosed.


Restrictions on the currency under which financial statements must be prepared


The financial statements should be prepared in EUR.


Accounting publications specific to the funds industry (as issued by accounting bodies or the regulators)


Both annual and interim reports must be in compliance with the Decision on the Contents of the Annual and Interim Reports of Investment Funds which was issued by the Securities Market Agency upon the precedent opinion of the Slovene Institute of Auditors.This legal act provides detailed regulations on annual and interim reports of investment funds such as:


  • the chart of accounts
  • the scheme of annual and interim financial statements of the investment funds
  • the content of the supplement with explanations on the annual and interim financial statements of the investment funds
  • the rules for the valuation of items in the financial statements of the investment funds1
  • the rules for the calculation of the net asset value of the investment funds.

The Securities Market Agency has also prescribed the following:


  • detailed content for the monthly reports and the methods and terms of the reporting
  • detailed rules on the distribution of profits or the retention of the net profit or income of the mutual funds.

The Slovene Institute of Auditors has also issued special Slovene Accounting Standard 38 which governs accounting treatments in mutual funds.


Slovene Accounting Standards are used for any issues which are not specifically covered by provisions of the aforementioned regulations.


Use of short form accounts


The regulations mentioned above prescribe the minimum amount of data that reports should contain. No short form of financial statements is legally permitted.


Umbrella schemes


An annual and half-yearly report of an umbrella fund shall contain the aggregate balance sheet and profit and loss statement of an umbrella fund, as well as the financial statement for each sub-fund of this umbrella fund separately.


The annual and half-yearly report must clearly indicate which parts are applicable to all sub-funds total and which refer only to an individual sub-fund.


The Agency may precisely prescribe the content of the annual and half-yearly report of an umbrella fund.


Classes of shares


Financial statements are required to incorporate all classes of shares.


There is no requirement to prepare separate financial statements for each class of share.


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1.2 Requirement to audit financial statements

According to the Act on Investment Funds and Fund Management Companies, the annual report of an investment fund has to be audited by an authorized auditor. The audit has to be performed within four months of the year-end. Management of the investment fund is obliged to submit the annual report together with the auditor’s report to the supervisory board within eight days of the receipt of the auditor’s report. The content of the auditor’s report is prescribed by the Securities Market Agency.


The audit has to be performed by an authorized auditor within an auditing company. The Securities Market Agency prepares a list of the authorized auditing companies that are allowed to perform audits of investment funds. The audit must be performed under the provisions of the Act on Investment Funds and Fund Management Companies, the Decision on the Contents of the Annual and Interim Reports of Investment Funds, Slovene Accounting Standards, and International Auditing Standards.


The auditor reviews and reports on the following, in particular:


  • the financial statements of the investment fund
  • book value of the shares of the investment company
  • net asset value per unit of the mutual fund
  • the regularity and completeness of the disclosures in supplements to the financial statements
  • the consideration of the rules of the Act on Investment Funds and Fund Management Companies and other related regulations
  • the regularity and completeness of the notes and reports to the Securities Market Agency and also of published information of the investment fund
  • the existence and operation of internal controls within the investment fund.

The interim reports do not require audit.


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1.3 Publication of financial statements

According to the legislation, the management company is obliged to publish the audited annual report and the interim report of the investment funds. They shall be published in media approved by the Securities Market Agency and at the places specified in the prospectus.


The management company is obliged to publish the audited annual report, which consists of the auditor’s opinion, summarized balance sheet, summarized profit and loss statement, and important data from the prospectus, within five months of the year-end. Prior to publication, the management company has to inform the Securities Market Agency of its intention.


The interim report has to be published within 15 days of its preparation.


All aforementioned reports are available to every interested person of the company at the places specified in the prospectus without any charges.


The management company has to submit the audited annual report of the investment fund to The Securities Market Agency within 15 days of receipt of the audit report but not later than 30 April of the following year. The interim report has to be submitted no later than 15 August of each year.


The annual accounts of investment funds also have to be submitted to the Statistic Office of the Republic of Slovenia and AJPES.


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1.4 Accounting standards

The financial statements of investment funds are prepared under the provisions of Slovene Accounting Standards (SAS) which take into account:


  • International Accounting Standards
  • the 4th Directive 78/660 of the European Union of 25 July 1978 based on Article 54 (3) (g) of the treaty on the annual accounts of certain types of companies
  • the 7th Directive of the European Union 83/349 of the European Union of 13 June 1983 based on Article 54 (3) (g) of the treaty on consolidated accounts.

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1.5 Contents of financial statements

Requirements for inclusion in annual financial statements:


Required by law Required by Slovene GAAP Complied with for best practice
A statement which includes all income less expenses plus realized and unrealized gains and losses No Yes Yes
A statement which only includes income less expenses No No No
A statement which only includes income less expenses plus realized gains and losses No No No
Statement of net assets and liabilities No Yes Yes
Statement of changes in net assets No Yes Yes
Cash flow statement No Yes Yes
Statement of accounting policies No Yes Yes
3-year net asset value table No Yes Yes

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1.6 Accounting treatments and disclosures

The following items (among others) must be included in the annual financial statements:


Required by law Required by Slovene GAAP Complied with for best practice
Futures are shown on balance sheet using the grossed up notional amount No No No
Futures are shown on the balance sheet based on the margin outstanding No Yes Yes
Futures are shown on the balance sheet based on the margin outstanding and the margin paid to date No Yes Yes
Organization costs are amortized immediately No Yes Yes
Organization costs are amortized over one year No No No
Organization costs are amortized over more than one year No No No
Issue costs are charged to the statement of operations No No No
Issue costs are netted off against creation proceeds No No No
Contingent deferred sales charges are recorded as income No No No
Contingent deferred sales charges are netted off against redemption proceeds No No No
Holdings in other collective investment funds are consolidated if the fund holds > 50 percent of the underlying collective investment fund's shares No No No
Methods used in financial statement presentation to measure listed investments are:
Cost No No No
Market value No Yes Yes
The financial statements distinguish between income and capital No Yes Yes

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1.7 Appendix 1

Reference material


The following details the relevant laws and regulations for collective investment funds and fund management companies and provides web addresses (in certain instances) where this material can be located.


Accounting pronouncements



Regulator



Stock exchange



Taxation authority



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1.8 Appendix 2

Reporting requirements


Financial statements have to include information on transactions, investments, profit, distribution of profits, and the value of the assets at the end of the period.


Annual report consists of:


  • balance sheet
  • profit and loss statement
  • cash flow statement
  • statement of changes in equity of the investment company/statement of changes in net asset value of the mutual fund
  • the structure of the investments
  • supplemental:
    1. description of the basic accounting principles used
    2. explanations of individual treatments and valuations
    3. assets statement.
  • business report
  • complete report of the auditor.

Interim report consists of:


  • balance sheet
  • profit and loss statement if the profit is distributed semiannually
  • supplemental
    1. explanations of individual treatments and valuations if they differ from the previous year’s
    2. assets statement.

Balance sheet should include at least the following items:


Assets


  • cash
  • short-term securities:
    1. securities issued by Republic of Slovenia
    2. other domestic securities
    3. foreign securities.
  • long-term securities
    1. securities issued by Republic of Slovenia
    2. other domestic securities quoted on the stock market: shares, bonds (municipals, company’s)
    3. other domestic securities that are traded: shares, bonds (municipals, company’s)
    4. foreign securities: shares, bonds (state, municipals, company’s)
    5. other securities.
  • loans and deposits:
    1. short-term
    2. long-term.
  • operating receivables:
    1. receivables from sold securities
    2. receivables from sold investment coupons or shares
    3. other receivables.

Liabilities


  • liabilities from the purchase of securities
  • liabilities from the purchase of investment coupons or shares
  • liabilities from tax payments
  • liabilities from management company
  • other liabilities.

Provisions


  • unrealized net capital gain
  • capital
    1. basic capital (subscribed capital)
    2. paid up capital surplus (only for investment companies)
    3. net profit or losses from previous years
    4. undistributed current net profit or loss
    5. capital revaluation adjustment.

Profit and loss statement includes at least the following items:


  • revenues from interest
  • revenues from dividends
  • realized capital gains
  • other revenues
  • total revenues
  • expenses in connection with the management company
  • unrealized net capital gain
  • realized capital losses
  • provisions
  • expenses in connection with agency of securities
  • any other expense representing more that 5 percent of all expenses
  • other expenses
  • total expenses
  • profit or loss
  • taxes
  • net profit
  • equalization of income deriving from the sale of coupons
  • equalization of income deriving from the paid out coupons
  • distributable profit:
    1. already distributed in the first half of the year
    2. final distribution.
  • undistributed profit.



1See Appendix 2.




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