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Amendments to the Accounting Act

With the amendments to the Accounting Act of August 2024 (State Gazette, 72 of 2024, effective 6 July 2024), Bulgaria has introduced the requirements of Directive (EU) 2022/2464 of the European Parliament and the Council. These changes have reshaped the way companies report on sustainability and comply with ESG standards. However, the practical implementation of these requirements has faced several challenges, leading to further amendments to the Accounting Act in February 2025.

Key Changes in the Accounting Act
According to the amendments published in the State Gazette, issue 17 of February 28, 2025, the deadlines for implementing the new requirements have been adjusted as follows:

The non-financial reporting requirements initially set for 2024 are postponed to 2025.
The requirements for 2025 are postponed to 2026.
The requirements for 2026 are postponed to 2027.

These changes take effect on the day of their publication in the State Gazette and provide Bulgarian businesses with additional time to prepare and adapt to the new rules.

Reasons for the Delay
An analysis of the transposition process of Directive (EU) 2022/2464 across EU member states shows that:

Only 18 countries have fully implemented it, while the remaining 11 are still in the process of discussing and adopting the necessary legal provisions.
The European Commission and the European Financial Reporting Advisory Group (EFRAG) have delayed the introduction of key standards and guidelines, including voluntary reporting standards for SMEs and sector-specific standards, making practical implementation more challenging.
Companies in Bulgaria do not yet have enough expertise, resources, and capacity to prepare non-financial reports, and the lack of practical experience across the EU further complicates the process.

What Are the Benefits of the Delay?
Postponing mandatory non-financial reporting offers several key advantages:

Better business readiness – Companies will have additional time to establish the necessary internal processes and expertise.
Cost efficiency – Preparation costs can be better distributed over time, avoiding unnecessary expenses.
Higher reporting quality – More time allows for in-depth analysis and refinements, improving the reliability of reported information.
Alignment with EU practices – Bulgaria will be able to follow the approach of other member states that have not yet fully implemented the directive.

In 2025, the European Commission plans to review and potentially ease sustainability reporting requirements, including the scope of obligated companies. This means that many Bulgarian businesses that would otherwise invest significant resources in preparing non-financial reports may find that these efforts are no longer necessary. Consequently, delaying these requirements will help businesses avoid unnecessary costs and remain competitive in the international market.

With the latest amendments to the Accounting Act, Bulgaria is giving businesses more time to adapt to the new sustainability reporting standards. This decision will allow companies to prepare more effectively, reduce unnecessary expenses, and benefit from the experience of other countries. Considering the forthcoming EU-level changes, postponing mandatory non-financial reporting is a strategic move that will facilitate a smoother and more efficient transition to ESG compliance.

Implementation of management standards

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The CONSEJO team has been involved in over 1,500 projects for organizations across various sectors of the economy, including manufacturing, construction, energy, information technology, transport, trade, the food industry and services. Our approach focuses on developing management systems that work effectively in practice, tailored to the specific characteristics and needs of each organization. We work closely with our clients, providing consulting support, staff training and assistance during implementation. We strive to deliver high-quality services within the agreed deadlines and solutions that support successful certification and create long-term value for businesses.

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