Running a limited liability company (d.o.o.) involves much more than issuing invoices, paying liabilities, and monitoring the balance of your business account. Every business transaction must be supported by appropriate documentation, properly recorded, and included in accounting records that provide a clear overview of the company’s financial position.

This is why bookkeeping is not merely an administrative part of the business that can be dealt with at the end of the month or year. It is a system that must function continuously, from the very first day of the company’s operations.

For owners and directors, this means understanding at least the basic accounting obligations associated with running a limited liability company, even when accounting tasks are outsourced to an external accounting service provider.

A d.o.o. must use double-entry bookkeeping from the first day of operations

Every d.o.o. is required to maintain its accounting records using the double-entry bookkeeping system. This obligation applies regardless of whether the company processes only a few invoices per year or hundreds of business transactions, and regardless of whether it generates a profit or operates at a loss.

Each business transaction is recorded in at least two corresponding accounts, enabling the company to track its assets, liabilities, income, expenses, equity, and overall financial performance.

In practice, this means that all changes must be properly recorded from the moment the company is established: from contributions to share capital and initial expenses to incoming and outgoing invoices, payroll calculations, depreciation, tax liabilities, and other business transactions.

The fact that a company has not generated revenue during a particular period does not mean that it has no accounting obligations.

Accounting records must provide a clear picture of the business

Double-entry bookkeeping is based on the journal, general ledger, and the relevant subsidiary records.

The journal records business transactions in chronological order, while the general ledger classifies those same transactions according to accounting categories. Subsidiary records provide further details on specific areas of the business, such as customers and suppliers, fixed assets, cash transactions, and other receivables and liabilities.

Although an owner or director does not need to review every accounting entry on a daily basis, they should be able to obtain clear answers to fundamental questions: how much the company owes, how much it is owed, what its cost structure looks like, whether there are any overdue liabilities, and what financial result the company is currently achieving.

Quality bookkeeping is therefore not merely a record of past transactions, but an important tool for managing the business.

Reliable documentation is the foundation of proper bookkeeping

Every accounting entry must be supported by appropriate documentation. This may include an invoice, bank statement, contract, payroll calculation, travel order, management decision, depreciation calculation, or another accounting document that reliably confirms the underlying business transaction.

One of the most common issues in practice is the late or incomplete submission of documentation to the accounting department.

For example, a charge made to a company card is not always sufficient for an expense to be properly recorded. The accountant needs documentation showing what was purchased, when, from whom, for what business purpose, and under which tax treatment.

It is therefore advisable to establish a simple system in which documentation is submitted continuously rather than only a few days before a tax or other statutory deadline.

Digital bookkeeping does not mean less responsibility

An increasing proportion of accounting documentation is now created and stored electronically. Digital invoices, bank statements, electronic records, and other documents can significantly simplify business operations, but only if the system is properly organised.

It is important to ensure that documentation remains accessible, legible, and reliable and that it can be linked to the relevant business transaction.

Digitalisation can eliminate a significant amount of manual administrative work, but it does not remove the need for proper documentation or the company’s responsibility for the information recorded in its accounting books.

Keeping documentation for a year or two is not enough

One obligation that is often underestimated concerns the retention periods for accounting documentation.

Accounting books, including the journal, general ledger, and subsidiary books, must be retained for at least 11 years. The same applies to accounting documents on the basis of which information has been entered into the accounting books.

Additional rules apply to payroll-related documentation, while certain records must be retained permanently.

This means that a company must have an organised archiving system that ensures documentation remains available for many years. Particular attention should be paid to electronic documentation, as changing accounting software, IT systems, or accounting service providers must not result in the loss of data.

Annual financial statements are more than an obligation to the authorities

At the end of the financial year, accounting data forms the basis for preparing the annual financial statements.

The scope of these statements depends on the size of the company, but every d.o.o. must ensure that its financial statements provide a reliable representation of its financial position and business performance.

For micro and small companies, the core financial statements consist of the balance sheet, profit and loss account, and notes to the financial statements, while larger companies are subject to additional reporting requirements.

This is also when the quality of bookkeeping throughout the year becomes particularly evident. If accounts have not been regularly reconciled, documentation is missing, or certain transactions have not been recorded on time, the year-end closing process becomes considerably more complex.

Inventory of assets and liabilities is an important part of the year-end closing process

Before preparing the final financial statements, it is necessary to verify whether the balances recorded in the accounting books correspond to the actual situation.

This includes taking an inventory of assets and liabilities, reviewing receivables and liabilities, reconciling bank accounts, checking fixed assets, and analysing outstanding items.

The inventory process is not merely a formality to be completed at the end of the year. Its purpose is to identify differences between accounting records and the actual situation and to ensure that any discrepancies are properly recorded before the accounting books are closed.

Company size determines some accounting obligations

Not all d.o.o. companies are subject to the same level of reporting requirements.

Companies are classified according to indicators such as the value of their assets, revenue, and average number of employees. This classification affects the scope of financial statements, the application of certain accounting rules, and additional obligations such as statutory audits.

Business growth therefore brings not only higher turnover but often a greater level of accounting and reporting requirements as well.

A company approaching the prescribed thresholds should check in advance whether moving into a higher category will affect its obligations in the following reporting period.

Outsourcing bookkeeping does not transfer management’s responsibility

For most businesses, engaging an external accounting service provider is a practical and efficient solution. However, it is important to understand that outsourcing accounting activities to an external professional does not transfer all statutory responsibility to that provider.

The company’s management remains responsible for the company’s operations, the reliability of its documentation, and its financial statements.

The relationship with an accountant should therefore involve more than simply sending a few invoices once a month. Effective cooperation requires the timely exchange of information regarding contracts, investments, recruitment, loans, new business activities, and other changes that may have accounting or tax implications.

The most common problem is not incorrect bookkeeping, but information provided too late

Many accounting problems arise before a document even reaches the accountant.

A company signs a contract, purchases a vehicle, makes a particular payment, launches a new business activity, or enters into a transaction with a related company, while the accounting department only learns about it after the transaction has already been completed.

At that point, there is considerably less room for effective tax and accounting planning.

This is why one of the most important rules for properly managing a d.o.o. is simple: involve your accountant before an important business transaction takes place, not only after it has already happened.

Bookkeeping should follow the business, not just statutory deadlines

Proper bookkeeping provides much more than compliance with statutory obligations.

When accounting data is up to date, business owners can monitor profitability, liquidity, outstanding liabilities, the collection of receivables, and changes in costs. Accounting information then becomes a basis for business decisions rather than merely material used to prepare annual financial statements.

This is the difference between bookkeeping that simply records what has already happened and accounting that genuinely supports the business.

Conclusion

Running a d.o.o. involves a range of accounting obligations that extend throughout the entire financial year. Companies need to ensure that their accounting books are properly maintained, documentation is reliable, transactions are recorded on time, records are retained correctly, and annual financial statements are prepared accurately.

The greatest risk arises when accounting is viewed merely as an administrative obligation that needs to be dealt with before a particular deadline.

A well-organised system established from the outset results in fewer errors, simpler reporting, and a much clearer overview of the company’s actual financial position.

If you would like to check whether your accounting books, documentation, and accounting processes comply with the requirements applicable in 2026, brandom is here to help.

Contact us and together we will organise your accounting processes so that they are accurate, timely, and tailored to the actual needs of your business.