Annual Report for Companies in Lithuania

Establishing a company in a foreign country is not an easy task. Behind the initial paperwork and establishment of hierarchy and work processes lies the administrative side of business activity – the annual report.

The tax system in Lithuania clearly separates business into multiple categories, presenting specific reporting requirements for each category. While different variations of financial reports are obligatory for every registered business, it’s important to note that annual reports are requested only from businesses that fulfil a set of additional criteria.

Criteria for an annual report

Annual reports must be submitted by Open Limited Companies (AB), Closed Limited Liability Companies (UAB), Full Partnerships (TUB) and Limited Partnerships (UB). An annual report must accompany financial reports that are obligatory in the category that the business falls within. Annual reports are not required for private or individual companies.

Contents of an annual report

Typically, an annual report should contain the following sections:

• Objective description of the current state of the company, overview of its activity and development, clear indication of business risks and gray areas that the business encounters.
• Analysis of financial and non-financial business outcomes, information related to environment protection and staff circulation.
• Statement of changes in equity.
• Information about company branches.
• Report on events that affected business activity throughout the taxation period.
• Full report on planned business growth and ongoing research.
• Report on risk management, risk mitigation strategies, credit and price risk management and control of other factors that could negatively impact business activity and (or) financial outcomes.
• Information about the responsibilities and, if applicable, other positions/duties that high profile staff members have, including their contact information.

Criteria for a financial report

Financial reports must be submitted by Open Limited Companies (AB), Closed Limited Liability Companies (UAB), cooperatives, agricultural companies, state- and municipally-owned companies, Full Partnerships (TUB), Limited Partnerships (UB), individual/private companies. Locally founded branches and departments of foreign companies must submit a financial report that represents the entire corporation.

Contents of a financial report

As briefly noted above, the composition of a financial report depends on the size of the company and operational capacity. Clear-cut categories for filing financial reports were confirmed in 2016. There are three criteria for each category, and regulation applies when a given business matches at least two or more.

Very small (micro) businesses must submit a short balance sheet and a brief profit and loss statement when:

1. Annual revenue is lower than 0,7 million euros
2. Total estate worth is less than 0,35 million euros
3. The number of employees is lower than 10

Small businesses must submit a short balance sheet, a brief profit and loss statement, and an explanatory report when:

1. Annual revenue is lower than 8 million euros
2. Total estate worth is less than 4 million euros
3. The number of employees is lower than 50

Medium-sized businesses must submit a full balance sheet, a full profit and loss statement, a cash flow statement, a statement of changes in equity, and an explanatory report when:

1. Annual revenue is lower than 40 million euros
2. Total estate worth is less than 20 million euros
3. The number of employees is lower than 250

Big businesses must submit a full balance sheet, a full profit and loss statement, a cash flow statement, a statement of changes in equity, an explanatory report, and an annual report when:

1. Annual revenue is higher than 40 million euros
2. Total estate worth is more than 20 million euros
3. The number of employees is higher than 250

Submission deadlines

Legal entities are required to file the annual report, together with the financial report, with the Commercial Register within six months following the end of the financial year. The report can be filed electronically.

While compiling and filing financial and annual reports may seem rather tedious and complicated, competent experts at Company in Lithuania UAB will help you open a company, provide accounting services and develop a business in Lithuania with ease and confidence.