Audit Requirements in Poland: Which Companies Need an Audit?

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Introduction to Polish Audit Requirements

Feeling overwhelmed by Poland’s audit requirements? You’re in good company. The Polish audit landscape can seem like navigating through a complex maze, especially for foreign entities or growing businesses reaching statutory thresholds for the first time.

In Poland, financial audits aren’t just regulatory checkboxes—they’re strategic tools that can either strengthen your business foundation or become costly compliance headaches if mishandled. The challenge isn’t just understanding if your company needs an audit, but also how to leverage this process for business advantage rather than treating it as a mere obligation.

Consider this: In 2022, the Polish Financial Supervision Authority (KNF) reported that nearly 15% of audited companies received qualified opinions—issues that could have been prevented with proper preparation. This statistic underscores why understanding audit requirements isn’t just about compliance—it’s about protecting your business reputation and financial integrity.

Through this comprehensive guide, we’ll transform complexity into clarity, helping you understand exactly which Polish companies must undergo statutory audits, how to prepare effectively, and how to turn this regulatory requirement into a strategic advantage.

Legal Framework for Audits in Poland

Poland’s audit requirements primarily stem from three key legislative sources:

• The Accounting Act (Ustawa o rachunkowości) – The fundamental legislation establishing accounting principles and audit requirements
• The Statutory Auditors Act – Regulating the audit profession and audit quality standards
• EU Audit Directive and Regulation – European framework incorporated into Polish law

The 2017 amendments to the Accounting Act significantly transformed Poland’s audit landscape by implementing EU Directive 2014/56/EU and Regulation 537/2014. These changes weren’t mere technical adjustments—they represented a fundamental shift toward greater transparency and audit quality, particularly for public-interest entities.

Professor Marek Dobrzański from Warsaw School of Economics notes: “The post-2017 Polish audit framework strikes a balance between rigorous oversight and practical implementation. Companies must recognize that these regulations aren’t designed merely for compliance but to strengthen market confidence in financial reporting.”

The Polish Financial Supervision Authority (KNF) and the Polish Audit Oversight Commission (PANA) jointly monitor compliance with these regulations. While KNF focuses on listed entities and financial institutions, PANA oversees the audit profession and conducts quality inspections of audit firms—creating a robust regulatory environment that companies must navigate carefully.

Size-Based Criteria for Mandatory Audits

Understanding the Thresholds

In Poland, size-based thresholds determine which companies must undergo statutory audits. According to the Accounting Act, a company must be audited if it exceeds two of the following three criteria in the preceding financial year:

Let’s illustrate this with a practical scenario: Imagine a growing Polish manufacturing company, ProdukcjaPro, with 55 employees, assets of 20 million PLN, and annual revenue of 55 million PLN. Despite having assets below the threshold, the company exceeds two other criteria (employment and revenue), making an audit mandatory.

Consecutive Year Considerations

An often overlooked aspect of Polish audit requirements is the consecutive year rule. If your company exceeded the thresholds in the preceding year, you must undergo an audit in the current year—even if your numbers have decreased below the thresholds.

This creates a potential trap for businesses experiencing temporary growth or one-time financial events. For example, ProjektBud, a construction company, temporarily exceeded the thresholds due to a large government contract in 2022. Even though their numbers fell below thresholds in 2023, they still required an audit for that year.

“Companies often mistakenly believe they can avoid an audit if their current year figures drop below thresholds,” explains Anna Kowalczyk, audit partner at a major accounting firm in Warsaw. “This misunderstanding can lead to unexpected compliance issues and rushed audit preparations.”

Special Cases: Industry-Specific Requirements

Financial Institutions and Listed Companies

Regardless of size, certain entities in Poland always require statutory audits due to their nature or industry:

• Banks, credit institutions, and insurance companies – Subject to enhanced audit requirements under both the Accounting Act and sector-specific regulations
• Warsaw Stock Exchange (WSE) listed companies – Must comply with additional audit disclosure requirements and quarterly financial reviews
• Investment funds and pension funds – Face specialized audit procedures focused on asset valuation and risk management
• Payment institutions and electronic money institutions – Required to have audits regardless of size

For these entities, the stakes are considerably higher. The KNF imposes additional reporting requirements and scrutinizes audit results with particular attention.

Mergers, Acquisitions, and Restructuring

Corporate transformations often trigger special audit requirements in Poland, regardless of company size:

• Pre-merger audits of financial statements for merging entities
• Special-purpose audits for business divisions or carve-outs
• Transformation audits for companies changing their legal form

Take the case of TechInnovate, a mid-sized software company that fell below the regular audit thresholds. When planning a merger with a competitor, they were surprised to learn that both companies required pre-merger audits of their financial statements—a requirement they hadn’t budgeted for in their transaction timeline.

“Transformation-related audits often catch businesses unprepared,” notes Tomasz Nowak, a corporate restructuring advisor. “They typically have tighter deadlines and more specific scopes than regular statutory audits, requiring more intensive preparation.”

The Polish Audit Process: What to Expect

Understanding what happens during a Polish statutory audit helps companies prepare effectively and minimize disruption to their operations.

Timeline and Key Phases

A typical Polish statutory audit follows this timeline:

1. Engagement and Planning (2-3 months before year-end)
   • Appointment of the auditor by shareholders or supervisory board
   • Signing engagement letters and establishing audit scope
   • Initial risk assessment and materiality determination
2. Interim Procedures (1-2 months before year-end)
   • Testing of internal controls and key processes
   • Preliminary analytical procedures
   • Identification of potential problem areas
3. Year-End Fieldwork (1-3 months after year-end)
   • Detailed testing of account balances and transactions
   • Verification of financial statement disclosures
   • Resolution of identified issues
4. Reporting and Finalization (3-4 months after year-end)
   • Issuance of audit opinion and report
   • Communication with management and audit committee
   • Filing audited statements with appropriate authorities

Note that companies listed on the WSE face tighter deadlines—they must publish their audited annual reports within 80 days of the year-end.

Documentation Requirements

Polish auditors typically request extensive documentation, including:

• Complete general ledger and trial balance
• Fixed asset and inventory registers
• Bank statements and reconciliations
• Customer and supplier contracts
• Tax returns and correspondence with tax authorities
• Board meeting minutes and significant management decisions
• Internal control documentation and procedures

“The most common audit delay we encounter is incomplete or disorganized documentation,” explains Piotr Adamczyk, audit manager at a Big Four firm in Krakow. “Companies that maintain well-structured, audit-ready documentation throughout the year significantly reduce audit time and costs.”

Selecting the Right Auditor in Poland

For companies requiring audits in Poland, auditor selection isn’t merely a procurement decision—it’s a strategic choice that impacts both compliance quality and business insights gained.

Under Polish regulations, auditors must be appointed by the company’s supervisory board or shareholders’ meeting. This appointment should occur at least 90 days before the fiscal year-end to allow adequate planning. Making a hasty selection often leads to mismatched expectations and inefficient audits.

When evaluating potential auditors, consider these factors:

• Industry expertise – Auditors with experience in your sector understand industry-specific accounting practices and risks
• Firm capabilities – Ensure the firm has sufficient resources for your company’s size and complexity
• Audit approach – Some firms emphasize technology and analytics, while others focus on detailed testing
• Communication style – Clear, proactive communication prevents last-minute surprises
• Value-added insights – The best auditors provide business recommendations beyond compliance

Remember that Polish regulations on auditor independence are strict, particularly for public interest entities. These companies must rotate audit firms at least every 10 years (with a possible extension to 20 years if a tender is conducted after 10 years). Non-audit services provided by your auditor are also significantly restricted.

LogistykaSA, a mid-sized transport company, learned this lesson the hard way. “We initially selected the lowest-cost auditor without considering industry expertise,” explains their CFO. “The result was an auditor unfamiliar with specific transport industry regulations, leading to repeated requests for additional information and extending our audit by nearly a month.”

Common Challenges and How to Overcome Them

Timing and Resource Constraints

The most frequent audit challenge for Polish companies is balancing audit requirements with ongoing business operations. Financial teams often find themselves stretched thin, particularly during the busy January-April period when both year-end closing and audit fieldwork occur simultaneously.

Strategic approaches to mitigate this challenge include:

• Establish a dedicated audit coordination team – Designate specific staff members responsible for audit liaison and documentation gathering
• Implement “audit-ready” documentation processes – Maintain organized supporting documents throughout the year rather than scrambling during audit season
• Consider interim audit procedures – Work with your auditor to complete some testing before year-end, reducing the post-closing workload
• Use technology solutions – Data analytics and document management systems can streamline information gathering

EcoTech, an environmental consulting firm in Wrocław, solved their resource constraints by implementing a quarterly “audit readiness” process. “We now prepare key reconciliations and documentation each quarter as if an audit were imminent,” explains their Financial Controller. “This reduced our year-end audit preparation time by 60% and allowed our finance team to maintain normal operations during the audit.”

Technical Accounting Challenges

Polish accounting standards, while based on EU-adopted IFRS for many entities, contain specific local requirements that frequently create audit complications:

• Revenue recognition complexities – Particularly for multi-element contracts and long-term projects
• Lease accounting – The transition to IFRS 16/Polish equivalent standards continues to challenge many companies
• Impairment testing – Particularly for goodwill and intangible assets
• Related party transactions – Documentation and arm’s length pricing verification
• Tax provisions and uncertain tax positions – A major focus area given Poland’s evolving tax regulations

To address these issues effectively:

1. Invest in regular accounting training for your financial team
2. Consider pre-audit consultations on complex accounting matters
3. Document technical accounting positions throughout the year, not just during audit
4. Develop accounting policy manuals specific to your company’s transactions

“The companies that navigate Polish audits most successfully are those that view accounting policy development as a year-round priority, not an audit-time reaction,” notes Maria Kowalska, accounting professor at Jagiellonian University.

Voluntary Audits: Strategic Benefits

Even when your company falls below mandatory audit thresholds, voluntarily undergoing an audit can yield significant strategic advantages in the Polish business environment.

Marta Wiśniewska, CFO of a growing technology startup in Poznań, explains: “When we were seeking our Series B funding round, our voluntary audit gave investors confidence in our financial governance. The investment process moved significantly faster because we had audited statements ready.”

Key benefits of voluntary audits in Poland include:

• Enhanced credibility with banks and financial institutions – Many Polish banks offer preferential lending terms for audited companies
• Smoother due diligence for potential investors or acquirers – An established audit history reduces transaction friction
• Early identification of financial reporting weaknesses – Resolve issues before they become mandatory compliance problems
• Valuable business insights – Professional auditors often identify operational improvement opportunities
• Preparation for crossing mandatory thresholds – Establish audit-ready processes gradually rather than reactively

For example, MediPolska, a healthcare services company, implemented voluntary audits three years before reaching mandatory thresholds. “This gradual approach allowed us to build robust financial reporting processes without the pressure of compliance deadlines,” their Financial Director explains. “When we crossed the threshold for mandatory audits, the transition was seamless, and we avoided the first-year audit challenges many of our peers experienced.”

If a full statutory audit seems excessive, consider these alternatives:

• Agreed-upon procedures – Targeted examinations of specific financial areas
• Review engagements – Less extensive than audits but providing limited assurance
• Internal control assessments – Focused on process improvements rather than financial statement opinions

Conclusion

Navigating Polish audit requirements doesn’t have to be a compliance burden—it can become a strategic advantage when approached proactively. Understanding whether your company meets the mandatory audit criteria is just the beginning; how you prepare for and leverage the audit process determines whether it becomes a value-adding activity or merely a regulatory checkbox.

The Polish audit landscape continues to evolve, with increasing emphasis on audit quality and independence. Companies that establish robust, audit-ready financial processes throughout the year—not just during “audit season”—position themselves for both compliance success and operational insights.

Remember these key takeaways:

• Closely monitor your company’s metrics against audit thresholds to avoid compliance surprises
• Select auditors based on industry expertise and communication style, not just cost
• Implement year-round documentation practices that streamline the audit process
• Consider voluntary audits as strategic tools for building credibility and preparing for growth
• View audits as opportunities for business improvement, not merely compliance exercises

With strategic planning and the right approach, your company can transform Polish audit requirements from a regulatory hurdle into a valuable business process that enhances financial governance and stakeholder confidence.

Frequently Asked Questions

What happens if my company fails to conduct a mandatory audit in Poland?

Failure to conduct a required statutory audit in Poland can result in significant consequences. Company management (Management Board members) may face personal fines up to 50,000 PLN. Additionally, the company’s financial statements would not be considered fully compliant with the Accounting Act, which can lead to rejection when filing with the National Court Register (KRS). This non-compliance can affect business relationships, as banks, major customers, and business partners often verify proper filing of audited statements. The Tax Office may also initiate additional tax audits if they identify that a required statutory audit was not performed.

Can we use the same accounting firm for both audit and tax advisory services in Poland?

For most companies, using the same firm for audit and certain tax services is permitted in Poland, but with important limitations. The Statutory Auditors Act implements the EU Audit Regulation, which places strict restrictions on non-audit services that auditors can provide, especially for public interest entities (PIEs). For PIEs, prohibited services include tax planning, certain tax consultancy, and valuation services. For non-PIEs, the restrictions are less severe, but independence principles still apply. Any permitted non-audit services must be pre-approved by the audit committee or equivalent oversight body. Additionally, for PIEs, fees for permitted non-audit services are capped at 70% of the average audit fees paid in the last three years. Always consult with your legal advisor regarding your specific situation, as violations can invalidate the audit opinion.

How far in advance should we begin preparing for our first statutory audit in Poland?

For companies approaching their first statutory audit in Poland, preparation should ideally begin 9-12 months before your financial year-end. This timeline allows sufficient opportunity to address fundamental accounting issues that could otherwise lead to qualified audit opinions. Start by selecting your auditor early—at least 6 months before year-end—to enable preliminary assessments and planning. Conduct a pre-audit review of accounting policies and procedures, ensuring they comply with relevant Polish accounting standards. Implement any necessary changes to financial reporting systems and controls to generate audit-required documentation efficiently. Provide training to your finance team on audit expectations and requirements. Companies that prepare thoroughly typically experience 30-40% shorter audit completion times and significantly fewer audit adjustments compared to those that begin preparations just weeks before the audit starts.