Accounting Developments in Poland

6790 WordsJun 27, 201128 Pages
Introduction of Poland Poland officially known as Republic of Poland (Rzeczpospolita Polska) is a country in Central Europe. Poland is bordered by Germany to the west; the Czech Republic and Slovakia to the south; Ukraine, Belarus and Lithuania to the east; and the Baltic Sea and Kaliningrad Oblast, a Russian exclave, to the north. The total area of Poland is 312,679 square kilometers (120,726 sq mi), making it the 69th largest country in the world and 9th in Europe. Poland has a population of over 38 million people, which makes it the 33rd most populous country in the world. (WBO, 2010) Historical Background A national accounting chart for Poland did not exist before the 1930s although an accountants’ Association was already established…show more content…
The cultural shift and market pressures prompted birth of the first truly comprehensive regulation of the independent Poland which is the Act on Accounting, 1994 (CPAA). This document was noticeably modeled on the 4th Directive (Formats and Rules of Accounting), 7th (Consolidated Accounting), and 8th (Qualifications and work of Auditors) EU Directives. As it is visible the concepts and notions included in the Accounting Act also relate to the last issued decree of 1983. Therefore, for accounting 1994, it determined the Western oriented direction in line with socio-political movement with simultaneous. The next important regulation is the Decree of Minister of Finance of August 1995 which resolved amongst other the issue of auditing the budgetary sector. Noticeably, solutions unique to Poland, feeding from West, East and within were developed. Very important requirements of this act, were recognition of only ‘acquired goodwill’ and use of ‘purchase method’ only when accounting for mergers and acquisitions. In these respect it can be noted that the solutions offered in IAS 38 IFRS 3 Business Combination. Additionally Poland already then was strongly recommending the cost method, which the current IAS 40 requires, even though the solutions at the time (ED 40) were recommending the equity method for long term investments measurement. Moreover already then, not in line with either EU 4th Directive or IAS 7 at the time, Poland was one of the few in Eastern Europe

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