Įstatymas skelbtas: ˇin OFFICIAL TRANSLATION REPUBLIC OF LITHUANIA LAW ON CONSOLIDATED ACCOUNTS OF GROUPS OF UNDERTAKINGS 6 November 2001 No IX-576 (As last amended on 26 June 2008 – No X-1634) Vilniu

s CHAPTER ONE GENERAL PROVISIONS Article

1. Purpose of the Law
2. This Law shall establish consolidated accounts of groups of undertakings and the drawing up of the consolidated annual report, responsibility for the drawing up and publishing of consolidated accounts and the consolidated annual report.
3. This Law has the objective of harmonising the drawing up of consolidated accounts and the consolidated annual report of groups of undertakings, responsibility for the drawing up and publishing of consolidated accounts and the consolidated annual report with the EU legal acts listed in the Annex to this Law. Article
4. Scope of the Law
5. This Law shall be applied to public limited liability companies and private limited liability companies capable of exercising a direct or indirect dominant influence on one or several profit-seeking legal persons (hereinafter referred to as “entities”).
6. In respect of financial institutions, the laws and other legal acts regulating pursuit of their activities may set forth additional requirements regarding consolidated accounts.
7. This Law shall be applied to banks, other credit institutions, insurance undertakings and reinsurance undertakings to the extent it does not contradict the laws regulating activities thereof. Article
8. Definitions
9. “Subsidiary undertaking” shall mean an entity which may be subject to a direct or indirect dominant influence by another entity.
10. “Group of undertakings” shall mean a parent undertaking and subsidiary undertakings thereof.
11. “Consolidation of financial reports of a group of undertakings” shall mean the pooling together of financial reports of a group of undertakings by applying the methods specified in Business Accounting Standards or International Accounting Standards.
12. “Consolidated annual report of a group of undertakings” (hereinafter referred to as the “consolidated annual report”) shall mean a report supplementing a set of annual consolidated financial reports and specifying data on a group of undertakings’ activities of the financial year and the activities envisaged as provided for by legal acts.
13. “Consolidated accounts of a group of undertakings” shall mean the preparation of data on the financial position, performance, cash flows of a group of undertakings as well as disclosure thereof in a set form.
14. “Set of consolidated financial reports of a group of undertakings” (hereinafter referred to as the “set of consolidated financial reports”) shall mean a set of financial reports compiled by a group of undertakings and presenting the generalised financial data of the reporting period of the group of undertakings.
15. “Set of annual consolidated financial reports of a group of undertakings” (hereinafter referred to as “annual consolidated financial reports”) shall mean a set of financial reports compiled by a group of undertakings and presenting the generalised data of the financial year of the group of undertakings.
16. “Indirect dominant influence on an entity” shall mean a dominant influence exercised on an entity by another entity via its subsidiary undertakings or subsidiary undertakings of the subsidiary undertakings as a result of at least one of the conditions specified in paragraph 10 of this Article.
17. “Parent undertaking” shall mean an entity which may exercise a direct or indirect dominant influence on another entity.
18. “Direct dominant influence on an entity” shall mean a dominant influence on another entity arising as a result of one of the following conditions: 1) the entity holds more than one half of the voting rights of another entity; 2) the entity, which is a member of another entity, has the right to elect or remove the head and the majority of members of a managing or supervisory body of that other entity; 3) the entity has the right to exercise a dominant influence on another entity under an agreement concluded with this entity or under the memorandum of association or articles of association; 4) the entity, which is a member of another entity, may, on the basis of agreements with other shareholders of the other entity, decide on the use of more than one half of the votes granted by the shares of the latter entity.
19. Other concepts used in this Law shall be interpreted as they are used in the Republic of Lithuania Law on Accounting, the Republic of Lithuania Law on Financial Statements of Entities, the Republic of Lithuania Law on Companies, the Republic of Lithuania Law on Audit and the Republic of Lithuania Law on Securities. Article
20. Conditions for the Drawing Up of Consolidated Financial Reports
21. A parent undertaking must draw up annual consolidated financial reports.
22. The financial reports of a parent undertaking and all subsidiary undertakings thereof must be consolidated regardless of where the registered offices of the subsidiary undertakings are situated.
23. An entity which is a subsidiary undertaking of a subsidiary undertaking of a group of undertakings shall be considered a subsidiary undertaking of a parent undertaking of the group of undertakings, and financial reports thereof must be consolidated.
24. A parent undertaking shall be allowed not to draw up consolidated financial reports where on the last day of the financial year of the parent undertaking, the common indicators of annual financial reports of a group of undertakings for two consecutive financial years, including the reporting financial year, do no exceed two of the following limits: 1) net turnover during the reporting financial year (without deducting intra-group turnover) – LTL 30 million; 2) the total value of assets specified in the balance sheet (without deducting intra-group transactions) – LTL 18 million; 3) average annual number of pay-roll workers during the reporting financial year – 75 persons.
25. The provision of paragraph 4 of this Article allowing to not draw up consolidated financial reports shall not apply any longer where at least two common indicators of annual financial reports of a group of undertakings on the last day of the financial year of a parent undertaking exceed the limits specified in that paragraph for two consecutive financial years, including the reporting financial year.
26. The provision of paragraph 4 of this Article shall not apply where a group of undertakings includes at least one public interest entity. Article
27. Exceptions to the Requirement for a Parent Undertaking Being a Subsidiary Undertaking of Another Group of Undertakings to Draw up Consolidated Financial Reports
28. A parent undertaking shall be exempted from the obligation to draw up consolidated financial reports where it is a subsidiary undertaking of a group of undertakings the parent undertaking whereof is registered in the Republic of Lithuania and fulfils one of the following conditions: 1) all of the shares thereof are held by its parent undertaking; 2) 90 per cent or more of the shares thereof are held by the parent undertaking, and the remaining shareholders do not object to the drawing up of consolidated financial reports.
29. An entity fulfilling one of the conditions referred to in paragraph 1 of this Article shall be exempted from the obligation to draw up consolidated financial reports only in the case when: 1) financial reports of the entity and subsidiary undertakings thereof are incorporated in the consolidated financial reports of another group of undertakings, the parent undertaking whereof is governed by this Law; 2) the notes on the accounts thereof disclose the name, code and registered office of the parent undertaking drawing up the consolidated financial reports referred to in subparagraph 1 of paragraph 2 of this Article, information about a decision on the exemption from the obligation to draw up the consolidated financial reports and the reasons for the exemption.
30. The exceptions indicated in this Article shall not apply where the securities of at least one entity of a group of undertakings are traded on a regulated market. Article
31. Exceptions to Consolidation of Financial Reports of a Subsidiary Undertaking
32. Financial reports of a subsidiary undertaking need not be included in consolidated accounts provided at least one of the following conditions exists: 1) shares of the subsidiary undertaking have been acquired with a view to their subsequent resale within one year from the last day of the reporting period; 2) activities of the subsidiary undertaking are subject to severe long-term restrictions hindering it in the transfer of assets and funds to the parent undertaking as well as in the exercise of management; 3) the information necessary for the drawing up of consolidated financial reports cannot be presented without disproportionate expense and undue delay.
33. In addition to the exception indicated in paragraph 1 of this Article, financial reports of a subsidiary undertaking need not be included in consolidated accounts where the entity is not material in respect of a group of undertakings. The subsidiary undertaking shall be considered not material in respect of the group of undertakings where assets thereof at the end of the financial year do not exceed 5 per cent of the assets of a parent undertaking, and the net turnover over the reporting year does not exceed 5 per cent of the net turnover of the parent undertaking over the same period. This provision shall not apply where the same group of undertakings contains several such subsidiary undertakings and exclusion of their financial reports from the consolidated accounts would infringe the principle of materiality as well as the requirement to give a fair view of the financial position of the group of undertakings and performance thereof. CHAPTER TWO DRAWING UP OF CONSOLIDATED FINANCIAL REPORTS Article
34. Components of a Set of Consolidated Financial Reports
35. A set of consolidated financial reports shall consist of the following consolidated financial reports: 1) consolidated balance sheet; 2) consolidated profit (loss) account; 3) consolidated cash flow statement; 4) consolidated statement of changes in equity; 5) notes on the accounts of consolidated financial reports.
36. All consolidated financial reports listed in paragraph 1 of this Article shall constitute a composite whole. Article
37. Requirements for Consolidated Financial Reports
38. Consolidated financial reports must be drawn up to give a true and fair view of the assets, equity, liabilities, income and expenditure as well as cash flows of a group of undertakings.
39. Consolidated financial reports shall be drawn up using the monetary unit of the Republic of Lithuania – the Litas.
40. Consolidated financial reports shall be drawn up in compliance with the Republic of Lithuania Law on Financial Statements of Entities, this Law and the Business Accounting Standards or the International Accounting Standards (hereinafter referred to as “accounting standards”). The consolidated financial reports of the entities whose securities are traded on a regulated market shall be drawn up in conformity with International Accounting Standards. Other entities may select whether to draw up the consolidated financial reports according to the Business Accounting Standards or the International Accounting Standards, and such a choice may not be altered earlier than after the lapse of 5 years (with the exception of the case when an entity joins a group of undertakings).
41. Where provisions of this Law as well as accounting standards are insufficient for consolidated financial reports to give a true and fair view of the assets, equity, liabilities, income and expenditure as well as cash flows of a group of undertakings, additional information must be supplied in the notes on the accounts of the consolidated financial reports.
42. Where in exceptional cases the consolidated financial reports drawn up according to the accounting standards are incompatible with the requirements set in paragraph 1 of this Article, the accounting standards may be departed from in order to meet the requirement of paragraph 1 of this Article to give a true and fair view of a group of undertakings’ assets, equity, liabilities, income and expenditure and cash flows. Any such case, reasons for and effects of it on the assets, equity, liabilities, income and expenditure and cash flows of the group of undertakings must be disclosed in the notes on the accounts.
43. Consolidated financial reports must disclose total assets, liabilities and equity capital of a group of undertakings on the last day of the reporting period for which the consolidated financial reports are drawn up, also the income and expenditure relating to the reporting period for which the profit (loss) account is drawn up.
44. When drawing up consolidated financial reports, the financial reports of a parent undertaking and subsidiary undertakings thereof for the same reporting period must be consolidated.
45. Where the reporting periods of a parent undertaking and subsidiary undertakings thereof are different, the reporting period selected by the largest entities of the group of undertakings for the drawing up of financial reports shall be selected when drawing up consolidated financial reports. In this case, other entities of the group of undertakings must draw up their financial reports until the last day of the reporting period for which the financial reports are drawn up in respect of the largest entities of that group of undertakings and, where this is impossible, financial reports for different periods may be consolidated, but these periods may not differ by more than three months.
46. Where provisions of paragraph 8 of this Article have been applied to the consolidation of financial reports, this fact must be disclosed in the notes on the accounts of the consolidated financial reports.
47. Where a parent-subsidiary relationship arises, the performance of the subsidiary undertaking shall be included in consolidated financial reports not as from the beginning of the financial year, but as from the day of the rise of the parent-subsidiary relationship.
48. Where a parent undertaking is deprived of a possibility of exercising a direct or indirect dominant influence on a subsidiary undertaking, the performance of the subsidiary undertaking until the day of deprivation of the possibility of exercising a direct or indirect dominant influence alone shall be included in consolidated financial reports.
49. Where an entity which is not under an obligation to draw up consolidated financial reports under this Law takes a decision of the drawing up of the consolidated financial reports at its own discretion, it must draw up the consolidated financial reports in compliance with the requirements set by this Law.
50. A parent undertaking must exercise the right to exercise a direct or indirect dominant influence in order to ensure that upon its request, subsidiary undertakings timely submit the information necessary to meet the requirements set by this Law. CHAPTER THREE CONSOLIDATED ANNUAL REPORT Article
51. Consolidated Annual Report
52. In addition to annual consolidated financial reports, entities must draw up the consolidated annual report.
53. The consolidated annual report must include: 1) a fair review of the position, performance and development of a group of undertakings, a description of the principal risks and uncertainties that it faces; 2) analysis of financial and non-financial performance of the group of undertakings, information relating to environmental and employee matters; 3) references to and additional explanations of the data presented in consolidated financial reports; 4) the important events which have occurred since the end of the financial year; 5) the operating plans and forecasts of the group of undertakings; 6) information about activities of the group of undertakings in the field of research and development; 7) the number and par value of the shares of the parent undertaking belonging to the undertaking itself, subsidiary undertakings thereof or the persons acting under the authorisation thereof, but on their own behalf; 8) where the group of undertakings uses financial instruments and where this is of importance for the evaluation of the assets, equity capital, liabilities, financial position and performance of the group of undertakings, financial risk management objectives, its policy for hedging major types of forecasted transactions for which hedge accounting is used, and the exposure of the group of undertakings to price risk, credit risk, liquidity risk and cash flow risk shall be disclosed.
54. In addition to the information specified in paragraph 2 of this Article, the consolidated annual report of the entities whose securities are traded on a regulated market must describe the principal features of the internal control and risk management systems of the group of undertakings relating to the drawing up of consolidated financial reports.
55. The consolidated annual report may be subject to additional requirements set by the laws and other legal acts regulating pursuit of activities of entities or an entity’s articles of association.
56. An entity drawing up a consolidated annual report may join its annual report with the consolidated annual report. When drawing up such a single report, it would be expedient to emphasise the issues of relevance for a group of undertakings, and the information specified in paragraph 3 of this Article must be supplied in a separate part of the report indicated in paragraph 3 of Article 25 of the Republic of Lithuania Law on Financial Statements of Entities. CHAPTER FOUR AUDIT OF CONSOLIDATED FINANCIAL REPORTS, SIGNATURE, APPROVAL AND PUBLISHING OF THEM AND THE CONSOLIDATED ANNUAL REPORT Article
57. Audit of Consolidated Financial Reports Audit of annual consolidated financial reports must be carried out in the entities drawing up consolidated financial reports. Article
58. Signature, Approval and Publishing of Consolidated Financial Reports and the Consolidated Annual Report
59. Consolidated financial reports and the consolidated annual report shall be signed by the head of a parent undertaking (his position, name and surname shall be specified).
60. Annual consolidated financial reports and the consolidated annual report shall be approved in accordance with the procedure set forth by laws.
61. The procedure for publishing approved annual consolidated financial reports and the consolidated annual report accompanied by an auditor’s report shall be the same as the procedure for publishing annual financial reports.
62. The published annual consolidated financial reports and the consolidated annual report must be reproduced in the form and text on the basis of which an auditor has drawn up his report. CHAPTER FIVE STORAGE OF CONSOLIDATED FINANCIAL REPORTS AND THE CONSOLIDATED ANNUAL REPORT, RESPONSIBILITY FOR THEIR DRAWING UP AND SUBMISSION TO THE LEGAL ENTITIES REGISTER Article
63. Procedure for Storing Consolidated Financial Reports and the Consolidated Annual Report The procedure for storing consolidated financial reports and the consolidated annual report shall be set forth by the Republic of Lithuania Law on Documents and Archives. Article
64. Responsibility for the Drawing Up and Submission of Consolidated Financial Reports and the Consolidated Annual Report to the Legal Entities Register The responsibility for the drawing up of consolidated financial reports and the consolidated annual report of a group of undertakings and submission thereof to the Legal Entities Register shall rest with the head of the parent undertaking and members of managing and supervisory bodies in accordance with the procedure laid down by laws within the sphere of competence assigned by the laws respectively to the head and the managing and supervisory bodies. The head of a parent undertaking and members of managing and supervisory bodies who fail to perform, or perform inappropriately, the duties related to the drawing up and submission to the Legal Entities Register of consolidated financial reports and the consolidated annual report of a group of undertakings according to the sphere of competence assigned by laws respectively to the head and managing and supervisory bodies must compensate for the entire incurred damage to the parent undertaking and/or other persons. I promulgate this Law passed by the Seimas of the Republic of Lithuania. PRESIDENT OF THE REPUBLIC VALDAS ADAMKUS Annex to Republic of Lithuania Law on Consolidated Accounts of Groups of Undertakings EU LEGAL ACTS IMPLEMENTED THEREBY
65. Seventh Council Directive 83/349/EEC of 13 June 1983 based on the Article 54