Accounting and tax services in Italy
Managing accounting and tax services in Italy is one of the most time-consuming aspects of running a business. Our team of expert accountants, tax specialists, and administrators provides comprehensive solutions for Italian companies’ annual accounts, ensuring compliance with local regulations. We handle everything from daily bookkeeping to audits in Italy, freeing you from the burden of paperwork. Whether you need assistance with routine accounting tasks or strategic tax planning, we are here to support your business every step of the way.
General Requirements for Italian Companies
Every Italian company is legally required to maintain accounting records that clearly document all financial transactions. Additionally, all Italian companies’ annual accounts must be filed with the Registrar of Companies (Registro delle Imprese) within four months following the end of the accounting year.
According to Italian law, directors must prepare full company accounts and obtain approval from shareholders at the general meeting. However, companies that qualify as small or medium-sized (as defined by Article 2435-bis of the Italian Civil Code) may submit an abbreviated version of their accounts to the Registrar, thus reducing the amount of information made publicly available.
A company can file abbreviated accounts unless it exceeds, for two consecutive years, at least two of the following thresholds:
- Net assets exceeding: € 4,400,000.00
- Turnover exceeding: € 8,800,000.00
- At least 50 employees
The accounts must be accompanied by a Director’s Report (nota integrativa), explaining the financial figures, and, if applicable, a report from the auditors, ensuring compliance with all relevant accounting in Italy standards.
Audit Requirements
Italian private limited companies (società a responsabilità limitata), which do not qualify to file the abbreviated account or are subject to file consolidated accounts or are part of a group that exceeds the limit shall appoint an internal auditor. Italian public limited companies (società per azioni) regardless of whether their stock is listed in a stock exchange shall appoint an internal board of auditors comprised of at least 3 members one of which must be a registered in the Italian Register of Auditors.
In addition, companies required to file consolidated accounts shall also appoint an external auditor.
Auditing is required for:
- Joint Stock Limited companies (S.p.A.); and
- Private limited companies (S.r.l.) exceeding two of the following limits in 2 consecutive years (a)) total assets of: EUR 2 million; (b) sales and services revenues of: EUR 2 million; or (c) average number of employees during the year: 10, or should the S.r.l. control a company subject to statutory audit;
- All companies drawing up consolidated financial statements;
- Listed companies;
- Banks, stock broking companies, fund management companies, regulated financial institutions.
The audit of the financial statements (“revisione legale dei conti”) shall be performed in accordance with the Italian Law (Art. 2409 bis of the Italian Civil Code) and the auditing standards issued by the Italian Institute of Chartered Accountant (CNDCEC, Consiglio Nazionale dei Dottori Commercialisti ed Esperti Contabili) which is equal to the International Standards on Auditing (ISAs) issued by the International Federation of Accountants (IFAC).
In addition, before being applicable, the Italian auditing standards need to be approved by the Italian Stock Exchange Authority, CONSOB (Commissione Nazionale per le Società e la Borsa).
In Italy, an audit can be performed by the Board of Statutory Auditors (“Collegio Sindacale”). They may oversee both supervision of compliance with the law and the Articles of Association, and the statutory audit of the financial statements.
However, the two tasks can also be split and assigned to two different bodies. The supervision can be given to the Collegio Sindacale and the audit of the financial statements (including the quarterly checks on the accounts) can be given to an audit firm or an auditor.
Separating of these two tasks is compulsory for listed companies, and companies must prepare consolidated financial statements.
Contact our team of accountants in Italy for more information about accounting and tax in Italy.
