IFRS In Hungary

Hungarian entities now have more time to prepare for the full implementation of International Financial Reporting Standards regulation.

Since 1 January 2016, Hungarian Accounting law has allowed Hungarian companies to use the International Financial Reporting Standards (IFRS) instead of statutory regulation. This staged transition to IFRS saw minor rule changes implemented on 16 June 2016. Affected companies are required to implement IFRS from 1 January 2017.

The following entities may (or may choose not to) draw up their annual reports in accordance with IFRS:

Description of the company From 1 January 2016 From 1 January 2017 Entity whose securities are listed on a regular market of any Member State of European Economic Area possibility obligatory Company owned directly or indirectly by a parent company which prepares its consolidated annual report in accordance with IFRS possibility possibility Entity authorised under the Concession Act for the pursuit of an activity subject to concession, or entitled to enter into a concession contract, or classified as a concession company possibility possibility Entity supervised by the National Bank of Hungary not applicable possibility Company who manages state or local government asset, property not applicable not applicable Non-profit business associations not applicable not applicable Insurance companies not applicable possibility Company subjected to statutory audit not applicable possibility Hungarian branch of a foreign company which is exempt from the statutory audit not applicable possibility Credit institution, financial enterprise equivalent to credit institution under prudential requirements not applicable obligatory Mutual association provided for in the Act on the Business of Insurance not applicable not applicable Pension fund, health fund, mutual aid fund not applicable not applicable The regulation determines the following additional terms to implement the IFRS:

an audit report of a statutory registered auditor or audit firm qualified for the application of the IFRS is required in proof of preparedness for transition to the IFRS entities shall report their transition to the IFRS to the state tax authority, the Central Statistics Office and the National Bank of Hungary (if the activity of the company is supervised by the National Bank of Hungary)...