HUP Supports Minister Marić’s Decision to Abolish the Unified Framework Chart of Accounts

The Croatian Employers’ Association has supported the decision of Finance Minister Zdravko Marić, whereby the Ministry of Finance proposes amendments to the Accounting Act that abolish the provisions on the mandatory application of the Unified Framework Chart of Accounts (UFCA) and its implementation from January 1, 2017. In this way, the proposals of HUP, which have been communicated to the proposer for a long time in writing, as well as in joint meetings where our positions were further argued, have been accepted.

HUP has been appealing for over a year on the necessity to abandon the introduction of UFCA for a number of reasons. They emphasized that the implementation of UFCA would require significant material resources from entrepreneurs, especially medium and large entrepreneurs. For the largest companies, this amount would reach multi-million figures. The implementation itself would cause prolonged months of preparation for the introduction of new software solutions, which would consequently require entrepreneurs to ensure additional engagement of their own workers, as well as external collaborators. The introduction of the unified framework chart of accounts does not contribute to increasing competitiveness or transparency in the Croatian economy. Due to all the aforementioned costs that could have been caused by the implementation of UFCA, there would inevitably be a reduction in the scope of investments in development, and it would certainly lead to delays in projects significant for the business of entrepreneurs.

“We believe that the existing chart of accounts is tailored to the needs of Croatian legislation and internal management, but also that it fully, unequivocally, and transparently ensures reporting in accordance with accounting standards (HSFI and MSFI). Given that the introduction of UFCA has not contributed in any way to establishing order or improving business operations, while simultaneously imposing significant new costs on an already overburdened economy, abandoning the intention to introduce it is the only correct decision,” concludes HUP.

We remind you that the Ministry of Finance on Wednesday submitted a proposal for amendments to the Accounting Act for public discussion, which would abolish the obligation to apply the unified framework chart of accounts. The Ministry has invited all interested parties to submit their opinions and proposals on the proposed amendments by November 9. As the most important amendment, the Ministry highlights “the abolition of the mandatory application of the unified framework chart of accounts, as its mandatory application would require significant costs for entrepreneurs due to the development of new IT solutions and possible negative impacts on the business results of entrepreneurs (blocking most projects).”