Greater administrative liability for late submission of fnancial  reports to be in effect in Armenia 

ArmInfo.Administrative liability for late submission of financial statements will be increased in Armenia. The National Assembly of the Republic of Armenia at a plenary session on February 12 approved amendments to the Code of Administrative Offenses submitted by the Government of the Republic of Armenia.

According to Arman Poghosyan, Deputy Minister of Finance of the Republic of Armenia, reforms related to the areas of accounting and auditing in large companies came into force on January 1, 2022. Over the period since then, institutional institutions have been formed in the country that successfully carry out their activities, the first results of which indicate serious achievements. However, there is one  problem that concerns the application of liability measures for the untimely publication of financial statements based on the audit conducted. During 2021-2023, the Ministry of Finance organized monitoring on this issue, according to the results of which 2 trends were identified. First of all, there is an annual increase in financial discipline on the part of organizations that submit their reports on time. However, the statistics of this process cannot be encouraging. Thus, almost half or 550 organizations that are required to submit their reports either do not publish them at all or do so incompletely. In particular, 12% of organizations submitted financial statements late, and 38% did not publish them at all. The monitoring showed that the measures applied to those who violated the fine clearly do not correspond to the average cost of an audit, which is about 6 million drams. At the same time, the liability for the specified violations in the first case is only 50 thousand drams, and  for a repeated violation 30 days after the first case - 500 thousand drams. The total amount of 550 thousand drams is only 10% of the average audit price.

In accordance with international experience, the draft law provides for the establishment of penalties that will correspond to the average audit price. To solve this problem, a three-stage system of calculating penalties will be used. In the first case, the fine will be 150 thousand drams instead of the current rate of 50 thousand drams, which is 2.5% of the average audit price, in the second case - 1.5 million drams (25%) instead of the current rate of 500 thousand drams, and in the third case - 4.5 million drams (50%) instead of 1 million drams at present.