In Portugal, the Commission for Accounting Standards (CNC) is responsible for accounting standards and procedures in accordance with relevant international and European standards. The CNC website provides access to the legislation on the National Plan of Accounts (POC) as well as the various European directives and technical guidelines on the subject.
According to the National Plan of Accounts (POC), ‘financial statements should provide information on the financial position, changes in this position and operating results, which may be useful to investors, creditors and other users in terms of making rational investments, providing credit and taking decisions. In this way they contribute to the efficient functioning of the financial markets’.
Within the Portuguese legislative framework, the usefulness of accounts is specifically indicated in the conceptual structure set out in the National Plan of Accounts (POC) and in the Accounting Guidelines (DC), particularly Accounting Guideline No 18 entitled ‘Objectives of financial statements and generally accepted accounting principles’.
The target public of this financial information is investors, financers, employees, suppliers and other creditors, public authorities and the general public.
Businesses operating in Portugal must present two documents at least once a year: balance sheet (table showing the financial situation) and profit and loss statement (itemised and summary).
Business accounts must be prepared by a Chartered Accountant (TOC), who is a professional responsible for planning, calculating and preparing business accounts and for technically coordinating all accounting operations. These professionals must be registered with the Association of Chartered Accountants.
The accounts prepared by the Chartered Accountant must be reviewed by a Statutory Auditor (ROC), who is responsible for all the checks and verifications needed to audit and certify the accounts. Only these professionals are authorised to carry out statutory audits of the accounts of companies or other entities.
The guide ‘Ten steps to starting up a business’ summarises the accounting procedures for all types of business.
The website of the Commission for Accounting Standards (CNC) has a question and answer service.
At EU level, an Expert Group (which included a member of the CNC), set up within the Directorate-General for Enterprise and Industry of the European Commission, has produced a report on good accounting practices for small enterprises.
This report aims to give guidance on how to improve the accounting systems of small and medium-sized enterprises (SMEs) so that they can provide the owners, managers and other stakeholders with appropriate financial information. This can be achieved through the identification and exchange of good practices between SMEs in the European Union.