Chamber's Achievement: Audit and Review Thresholds to Increase by 25%
The Estonian Parliament has passed amendments to the Accounting Act and related legislation, which will raise the thresholds for mandatory audits and reviews by 25%. These new thresholds will apply to annual reports for the financial year 2024.
In the spring of 2023, the Chamber (The Estonian Chamber of Commerce and Industry) proposed to the Ministry of Finance that the thresholds for mandatory audits and reviews, unchanged since 2016, be increased. The aim of this change was to reduce costs and administrative burdens for companies.
The Ministry of Finance partially considered the Chamber’s proposal and introduced a draft law to increase the thresholds for mandatory audits and reviews by 25% in terms of assets and turnover. While the Chamber had suggested a 50% increase, this recommendation was not supported by the Ministry of Finance or the Economic Affairs Committee of the Parliament. As a result, the thresholds will rise by 25%.
Uued kohustusliku auditi ja ülevaatuse piirmäärad on järgmised:
Audit Threshold | Review Threshold | |
| 1) Meets two of the following three conditions: |
|
|
| Turnover or revenue | 5 million euros | 2 million euros |
| Assets | 2,5 million euros | 1 million euros |
| Average number of employees | 50 | 24 |
|
| |
| 2) Meets one of the following three conditions |
|
|
| Turnover or revenue | 15 million euros | 6 million euros |
| Assets | 7,5 million euros | 3 million euros |
| Average number of employees | 180 | 72 |
The new thresholds will be retroactively applied to reporting periods starting on or after January 1, 2024.
Impact of the Changes
As a result of these changes:
- Approximately 600 companies will no longer be required to undergo reviews.
- Over 500 companies will see their audit obligations replaced with review obligations.
- Direct annual cost savings for companies are estimated at around €2 million.