Czech Accounting Profession Certification cheat sheet

Accounting Act (563/1991 Sb.) and Decree 500/2002 Sb. govern entrepreneurs' double-entry bookkeeping; Czech Accounting Standards (ČÚS) 001–024 give detailed procedures for each area.

Accounting entity must keep books in Czech crowns; foreign currency transactions are translated at the Czech National Bank (ČNB) rate on the transaction date unless a fixed internal rate is set in advance.

Double-entry: every transaction is recorded with equal debits and credits; the chart of accounts (směrná účtová osnova) groups accounts into classes 0–9 (0 fixed assets, 1 inventories, 2 financial accounts, 3 receivables/payables, 4 capital/long-term liabilities, 5 expenses, 6 revenues, 7 closing accounts, 8 off-balance, 9 internal).

Documentation: every entry needs an accounting document (účetní doklad) that is complete, verifiable, and signed by the person who prepared it and the person who approved it.

Valuation rules: assets at acquisition cost (pořizovací cena), own costs (vlastní náklady), or reproduction cost (reprodukční pořizovací cena); inventories typically at acquisition cost or own cost; securities at fair value for trading portfolios.

Depreciation: tax depreciation follows §26–33 of the Income Tax Act (ZDP); accounting depreciation is entity-set and booked on a monthly basis to accounts 551 (depreciation) and 08x (accumulated depreciation).

Closing operations include accruals (381/385), deferrals (382/383), exchange-rate adjustments (563/663), and provisions (55x); they must be booked before closing entries (7xx).

Books must be retained for 5 years after the end of the accounting period; accounting documents for 5 years; payroll records for 30 years; tax documents for 10 years.

Closing the books (uzávěrka) means (1) verifying balances, (2) booking adjustments, (3) calculating tax, (4) closing expense/revenue accounts to 710 (profit and loss), then (5) closing 710 to 702 (profit or loss).

Financial statements include: balance sheet (rozvaha), profit and loss statement (výkaz zisku a ztráty), notes (příloha), and cash flow statement (přehled o peněžních tocích) plus statement of changes in equity for entities required to have statutory audit.

Balance sheet is prepared at net book value (gross minus accumulated depreciation and provisions); assets and liabilities are classified as long-term (over 1 year) or short-term (≤ 1 year).

P&L is prepared in either the by-nature (druhové) or by-function (účelové) format; the by-nature format uses groups 50 (consumed purchases/services), 52 (wages), 53 (taxes/fees), 54 (other), 55 (depreciation), 56 (financial), 58 (extraordinary).

Reporting deadline: entities registered in the Commercial Register file financial statements with the collection of documents of the registry court within 12 months of the balance-sheet date.

Small, micro, medium, and large entity categories are defined by Act 563/1991 and Directive 2013/34/EU using total assets, net turnover, and average employees; category determines audit and reporting obligations.

Statutory audit is required when two of three thresholds are exceeded for two consecutive periods: total assets > 40 million CZK, net turnover > 80 million CZK, average employees > 50.

Approval of financial statements is by the general meeting (or equivalent body); profit distribution is booked after approval, not in the reporting period being closed.

Income Tax Act (ZDP, 586/1992 Sb.) defines the tax base as accounting profit adjusted for non-deductible expenses, non-taxable income, and items taxed separately; the tax base is rounded to whole thousands of CZK down.

Corporate income tax rate is 21% (from 2024); withholding tax on dividends is 15% (0% for parent-subsidiary under conditions); personal income tax uses 15% and 23% brackets.

Non-deductible items include: gifts outside §20(8), fines and penalties, representation expenses (reprezentace), personal use of business assets, and expenses not documented per §24.

Tax depreciation methods: straight-line (rovnoměrné) and accelerated (zrychlené) under §31 and §32 ZDP; taxpayer may switch from accelerated to straight-line but not vice versa.

Tax loss can be carried forward 5 years; since 2020 it is claimed in the year of loss first, then in the following years (no carryback).

Tax records (daňová evidence) under §7b ZDP: for sole traders not keeping double-entry books, tracking income, expenses, receivables, payables, and inventory; income is recognised on a cash basis.

VAT payer's tax base for income tax purposes is income net of VAT; non-VAT payers include VAT in income and expense.

Tax return filing deadline: 3 months after the end of the tax period; 4 months if filed electronically; 6 months if prepared by a tax adviser or if the entity is audited.

VAT Act (235/2004 Sb.): standard rate 21%, reduced rate 12% (from 2024) for food, medicines, books, accommodation, and selected services; 0% for exports and intra-community supplies.

Registration thresholds: mandatory registration when turnover exceeds 2,000,000 CZK in 12 consecutive months; voluntary registration is possible at any time; registration is effective from the 3rd working day after exceeding the threshold.

VAT return is filed monthly or quarterly (quarterly only if turnover ≤ 10 million CZK); deadline is the 25th day after the end of the period.

Input VAT deduction requires: taxable supply, tax document with all mandatory elements (§29), supply used for economic activity, and no exclusion under §75.

Reverse charge (přenesení daňové povinnosti) applies to construction works, scrap, selected electronics, and cross-border B2B services under §9(1); both parties report VAT.

OSS (One Stop Shop) for cross-border B2C services and distance sales of goods; registration in the Czech Republic via the Special Tax Office; quarterly returns and payments.

Control statement (kontrolní hlášení) is filed together with the VAT return; reporting of selected transactions (B2B invoices over 10,000 CZK, imported goods, etc.).

Other indirect taxes: excise duties (spotřební daně) on alcohol, tobacco, fuel under Act 353/2003; energy tax (ekologická daň); road tax (silniční daň) for business vehicles.

Employee social insurance rate: 7.1% (6.5% pension + 0.6% sickness); employer rate: 24.8% (21.5% pension + 2.1% sickness + 1.2% unemployment); health insurance 9% (4.5% employee + 4.5% employer).

Personal income tax is 15% on gross up to 48× average wage, 23% above; the tax base is gross salary plus employer-paid benefits taxable to the employee.

Taxpayer reliefs: basic relief (30,840 CZK/year in 2024), spouse relief (24,840 CZK if income ≤ 68,000 CZK), child benefit (15,204 CZK first child, 22,320 second, 27,840 third and further).

Minimum wage (2024): 18,900 CZK/month or 112.50 CZK/hour; guaranteed wage (zaručená mzda) is set by government decree for eight work categories.

Payroll deductions: income tax advance, social insurance, health insurance, and court-ordered or employee-authorised deductions (garnishment limits under Government Decree 595/2006).

Sick leave (nemocenská): first 14 calendar days paid by employer as 60% of reduced earnings; from day 15 the Czech Social Security Administration pays 60% of daily assessment base (with reductions).

Maternity leave: 28 weeks (37 weeks for multiple births); 70% of daily assessment base; parental leave up to 3 years of child's age.

Payroll records must be retained 30 years; ELDP (evidence list of insured periods) is submitted annually to ČSSZ; monthly reports (přehled) to health insurers by the 20th of the following month.

Cost classification by nature (druhové): material, wages, depreciation, services; by purpose (účelové): direct and indirect costs, production and administrative costs.

Full costing (absorpční kalkulace) allocates both direct and indirect costs to cost objects; variable costing (neúplná kalkulace) allocates only variable costs and treats fixed costs as period costs.

Cost allocation bases: direct labour hours, machine hours, material costs, or activity drivers; overhead rate = total overhead / allocation base.

Standard costing: standard cost = standard quantity × standard price; variances are price variance, quantity (efficiency) variance, and overhead variance; favourable vs. unfavourable.

Break-even point = fixed costs / contribution margin per unit; contribution margin = price − variable cost per unit; margin of safety = (actual sales − break-even sales) / actual sales.

Budgeting process: top-down (authoritative), bottom-up (participative), and zero-based budgeting; rolling budgets are revised each period; flexible budgets adjust for actual volume.

Cost centres (střediska) track costs; profit centres track both revenues and costs; investment centres add return on invested capital (ROI) as a KPI.

Responsibility accounting: each manager is accountable for controllable costs; variances are analysed against budget with root-cause analysis (price, volume, mix).

Statutory audit in the Czech Republic is governed by Act 93/2009 Sb. on auditors and the Chamber of Auditors of the Czech Republic (KA ČR); auditors must be members of KA ČR and comply with ISA as adopted by KA ČR.

Audit opinion types: unmodified (clean), qualified, adverse, and disclaimer; emphasis of matter and other matter paragraphs do not modify the opinion.

Audit risk model: audit risk = inherent risk × control risk × detection risk; auditor reduces detection risk through substantive procedures and tests of controls.

Materiality: overall materiality is typically a percentage of profit before tax (5%), total revenues (0.5–1%), or total assets (1–2%); performance materiality is set lower.

Internal control components (COSO): control environment, risk assessment, control activities, information and communication, monitoring activities; segregation of duties is a key preventive control.

Ethics: independence in mind and appearance; threats include self-interest, self-review, advocacy, familiarity, and intimidation; safeguards include rotation, second partner review, and prohibition of certain non-audit services.

Audit documentation must be retained for 10 years from the date of the auditor's report; engagement quality control review is required for listed entities and public-interest entities.

Auditor rotation: for public-interest entities, the audit firm rotates after 10 years (extendable to 20 with tender, or 24 with joint audit) under EU Regulation 537/2014.

Accountants in the Czech Republic are not regulated by a single professional body; bookkeeping can be performed by any person with the required competence under the Trade Licensing Act (živnostenský zákon).

Act 563/1991 Sb. (Accounting Act) sets the framework: accounting entities, accounting periods, documentation, valuation, inventory, closing, and financial statements.

Act 586/1992 Sb. (Income Tax Act) and Act 235/2004 Sb. (VAT Act) define tax obligations; Act 280/2009 Sb. (Tax Code) governs tax administration, deadlines, penalties, and appeals.

Professional certifications: Certifikace účetních (KA ČR), Certifikace IFRS, and the Chamber of Tax Advisers (Komora daňových poradců) for tax advisers; auditors are registered with KA ČR.

Money laundering: Act 253/2008 Sb. requires accountants to identify clients, apply customer due diligence, and report suspicious transactions to FAÚ (Financial Analytical Office).

GDPR (EU 2016/679) and Act 110/2019 Sb. on personal data protection apply to payroll and client records; data must be retained only as long as legally required.

Anti-money-laundering obligations include a risk-based approach, beneficial ownership identification (Act 37/2021 Sb. on the register of beneficial owners), and record retention for 10 years.

Statutory deadlines: financial statements filed within 12 months of balance-sheet date; tax return within 3 months (extendable to 4 or 6); VAT return by the 25th of the following month.

Accounting period (účetní období) is 12 consecutive months; it may be a calendar year or a fiscal year; a newly formed entity's first period may be shorter.

Inventory (inventarizace) must be performed at the balance-sheet date: physical count of assets and verification of liabilities; differences are booked as inventory shortages (manco) or surpluses (přebytek).

Receivables and payables are recognised at nominal value; provisions and impairment (opravné položky) are created on a temporary basis when the carrying amount exceeds the recoverable amount.

Foreign currency: exchange rate differences at balance-sheet date are booked to 563 (losses) or 663 (gains); unrealised differences on financial assets and liabilities are recognised in profit or loss.

Long-term tangible assets: acquisition cost includes purchase price, transport, installation, and incidental costs; assets under 80,000 CZK may be expensed as operating costs.

Leases: finance leases are recognised as assets and liabilities by the lessee under Czech rules only if title transfers; operating leases are expensed; IFRS 16 applies for consolidated IFRS reporters.

Chart of accounts classes: 0 fixed assets, 1 inventories, 2 financial accounts, 3 receivables/payables, 4 capital, 5 expenses, 6 revenues, 7 closing accounts, 8 off-balance sheet, 9 internal accounting.

Errors: material prior-period errors are corrected through retained earnings (account 426) after approval of financial statements; immaterial errors are corrected in the current period.

Closing entries: transfer all expense accounts (5xx) and revenue accounts (6xx) to 710; then transfer 710 balance to 702 (profit) or 701 (loss); 702/701 is transferred to 431 (retained earnings) or 429 (uncovered loss).

Balance sheet structure: assets (A. receivables for subscribed capital, B. fixed assets, C. inventories, D. receivables, E. cash, F. accruals) and liabilities (A. equity, B. liabilities, C. accruals, D. provisions).

P&L structure: production, sales, performance, cost of sales, gross profit, distribution costs, administrative costs, operating profit, financial result, tax, net profit.

Notes (příloha) must disclose accounting policies, valuation methods, depreciation methods, provisions, contingent liabilities, and post-balance-sheet events.

Cash flow statement uses indirect or direct method; indirect reconciles net profit to operating cash flow by adjusting non-cash items and working capital changes.

Consolidated financial statements: parent with control (usually >50% voting rights) consolidates subsidiaries; exemptions apply for small groups below two of three thresholds (assets 40M, turnover 80M, 50 employees).

Statutory audit thresholds (two of three for two consecutive periods): assets > 40 million CZK, turnover > 80 million CZK, employees > 50; public-interest entities always audited.

Post-balance-sheet events (events after the reporting period) that provide evidence of conditions at the balance-sheet date are adjusting events; those arising after are non-adjusting and disclosed.

Tax period for corporate income tax is the accounting period; for individuals it is the calendar year; tax return is due within 3 months of the end of the tax period (4 if electronic, 6 if tax adviser or audited).

Tax advances: corporate entities pay quarterly advances based on the last known tax liability; advances are due by the 15th of the last month of each quarter (15 March, 15 June, 15 September, 15 December).

Deductible expenses must be incurred to generate, assure, and maintain taxable income (§24 ZDP); non-deductible items are listed in §25 ZDP.

Tax base = accounting profit (or difference between income and expenses in tax records) + non-deductible expenses − non-taxable income − items taxed separately; rounded down to whole thousands.

Tax credits: investment incentive credit, credit for research and development (§34 ZDP), credit for training (odpočet na vzdělávání), and patent/software credit.

Tax loss carryforward: 5 years; taxpayer must apply the loss in the earliest year first; loss cannot be claimed in the year of liquidation or transformation.

Tax records (daňová evidence) must track: income and expenses, receivables and payables, inventory, and assets; income is recognised on a cash basis.

Transfer pricing: transactions between related parties must be at arm's length; documentation obligations follow OECD Guidelines and §23(7) ZDP; country-by-country reporting for large groups.

VAT payer identification: Czech VAT number starts with CZ + IČO; registration is mandatory when turnover exceeds 2,000,000 CZK in 12 consecutive months; voluntary registration possible.

VAT return and control statement are filed electronically; the control statement reports B2B invoices over 10,000 CZK, imported goods, and selected transactions.

Place of supply of services: B2B services are taxed where the customer is established (§9(1)); B2C services follow the place of the supplier unless exceptions apply (e.g., electronically supplied services taxed where the consumer is).

Exempt supplies without credit: financial services, insurance, education, healthcare, and letting of real estate; exempt with credit: exports, intra-community supplies, and international transport.

VAT deduction: input VAT must be claimed in the period of receipt of the tax document; correction is possible within 3 years; a simplified procedure applies to bad debts.

VAT groups (skupiny): two or more related entities can register as a VAT group; supplies within the group are not subject to VAT; the group is treated as a single taxable person.

Excise duties: on alcohol (spirits, beer, wine), tobacco products, and mineral oils; rates are set per unit; tax warehouses and authorised receivers are used for deferred payment.

Road tax (silniční daň): applies to business vehicles; rates depend on engine size and axle count; electric vehicles are exempt; hybrid vehicles have reduced rates.

Gross salary (hrubá mzda) includes base salary, bonuses, commissions, and benefits taxable to the employee; net salary = gross − income tax advance − social insurance (7.1%) − health insurance (4.5%).

Income tax advance: 15% on gross up to 48× average wage (monthly threshold 146,424 CZK in 2024); 23% above; the taxpayer reliefs are applied through the annual tax return or monthly payroll declaration.

Employer contributions: 24.8% social insurance and 9% health insurance on gross salary; total employer cost = gross × 1.338.

Employee benefits: meal vouchers (up to 55% of meal allowance tax-deductible), pension insurance contributions (up to 50,000 CZK/year tax-free for employee), and recreation (up to 20,000 CZK/year).

Sick leave: first 14 days paid by employer at 60% of reduced earnings; from day 15 ČSSZ pays 60% of daily assessment base; the employer must keep records of sick leave.

Termination: notice period is 2 months; severance pay is 1× average monthly earnings for <2 years, 2× for 2–5 years, 3× for 5–10 years, 4× for 10+ years.

Payroll reports: monthly reports to health insurers by the 20th; ELDP (evidence list of insured periods) submitted annually to ČSSZ by 31 January for the previous year.

Working time: maximum 40 hours/week; overtime is permitted up to 8 hours/week (150 hours/year); overtime premium is 25% or compensatory time off.

Costing methods: job costing (zakázková) for custom orders, process costing (procesní) for mass production, and activity-based costing (ABC) for overhead allocation based on activities.

Overhead allocation: primary allocation (direct to cost centres), secondary allocation (between cost centres using reciprocal or step-down methods), and tertiary allocation (to cost objects).

Contribution margin ratio = (revenues − variable costs) / revenues; break-even point in revenue = fixed costs / contribution margin ratio.

Operating leverage = contribution margin / operating profit; a high leverage means profit is sensitive to sales changes.

Variance analysis: price variance = (actual price − standard price) × actual quantity; quantity variance = (actual quantity − standard quantity) × standard price; total variance = price + quantity.

Budget types: operating (sales, production, purchases, labour), financial (cash flow, capital), and master budget; flexible budgets adjust for actual activity level.

Responsibility centres: cost centre (costs only), profit centre (revenues and costs), investment centre (profit and capital employed); ROI = operating profit / invested capital.

KPIs: ROI, residual income, EVA (economic value added = NOPAT − WACC × invested capital), and balanced scorecard (financial, customer, internal, learning and growth).

Auditor independence: no financial interest, no loans, no close family relationships with client; prohibited non-audit services include bookkeeping, internal audit outsourcing, and tax advice that affects the financial statements.

Audit procedures: risk assessment (inquiry, analytical procedures, observation), tests of controls, and substantive procedures (inspection, external confirmation, recalculation, re-performance).

Internal control: preventive controls (segregation of duties, authorisation), detective controls (reconciliations, physical counts), and corrective controls (exception reports).

Fraud triangle: incentive/pressure, opportunity, and rationalisation; auditor must maintain professional scepticism and consider fraud risk in revenue recognition and management override.

Audit report: must include title, addressee, opinion, basis for opinion, key audit matters (for listed entities), responsibilities of management and auditor, and signature with date.

Quality control: ISQC 1 requires engagement quality control review, independence monitoring, and rotation of engagement partners for public-interest entities.

Ethical threats: self-interest, self-review, advocacy, familiarity, and intimidation; safeguards include education, rotation, independent review, and disclosure.

Audit documentation: must be sufficient to enable an experienced auditor to understand the work performed; retention is 10 years from the date of the auditor's report.

Accounting entities under §1 of Act 563/1991 Sb.: legal entities with registered office in the Czech Republic, foreign entities doing business in the Czech Republic, and individuals with turnover over 25 million CZK or keeping books voluntarily.

Accounting period is 12 consecutive months; it may be a calendar or fiscal year; the first period may be shorter than 12 months but must end on the last day of a calendar month.

Financial statements must be filed with the collection of documents of the registry court within 12 months of the balance-sheet date; the filing is done electronically.

Tax Code (280/2009 Sb.): tax return deadline is 3 months from the end of the tax period; extension to 4 months for electronic filing and 6 months if prepared by a tax adviser or audited.

Penalties: late filing of tax return attracts a penalty of 0.1% of the tax assessed per day, up to 5% of the tax; late payment interest is 14% p.a. plus repo rate.

Anti-money laundering: Act 253/2008 Sb. requires customer due diligence, beneficial owner identification, and suspicious transaction reporting to FAÚ; record retention is 10 years.

GDPR: personal data must be processed lawfully, fairly, and transparently; payroll data retention is 30 years for social security purposes; data subject rights include access, rectification, and erasure.

Professional bodies: Chamber of Auditors (KA ČR), Chamber of Tax Advisers (KDP ČR), and the Union of Accountants (Svaz účetních); membership in KA ČR and KDP ČR is mandatory for auditors and tax advisers.

Accounting methods: double-entry bookkeeping (podvojné účetnictví) for legal entities and entrepreneurs over the turnover threshold; tax records (daňová evidence) for sole traders under the threshold.

Accounting documents must be numbered, dated, describe the transaction, identify the parties, and be signed; they must be retained for 5 years (10 years for tax documents).

Valuation at the balance-sheet date: assets at historical cost less depreciation and impairment; financial assets at fair value; inventories at the lower of cost or net realisable value.

Provisions (rezervy): recognised when there is a present obligation from a past event, it is probable that an outflow will be required, and the amount can be reliably estimated.

Accruals (časové rozlišení): expenses and revenues are recognised in the period to which they relate, not when cash is paid or received; accounts 381–385.

Depreciation: accounting depreciation is set in the entity's depreciation plan; tax depreciation follows §26–33 ZDP; differences are reconciled in the tax return.

Fixed assets: technical improvement (technické zhodnocení) increases the asset's value if it exceeds 40,000 CZK per year; otherwise it is a repair (oprava) expensed.

Inventory: physical count at the balance-sheet date; differences are booked as manco (shortage) or přebytek (surplus); inventory is valued at acquisition cost or own cost.

Closing of accounts: (1) verify balances, (2) book accruals, provisions, and exchange-rate differences, (3) calculate income tax, (4) close expense and revenue accounts to 710, (5) close 710 to 702 (profit) or 701 (loss).

Financial statements: balance sheet, profit and loss statement, notes, and (for audited entities) cash flow statement and statement of changes in equity.

Balance sheet is prepared at net book value; assets and liabilities are classified as long-term (>1 year) or short-term (≤1 year); equity includes share capital, reserves, and retained earnings.

P&L is prepared in by-nature or by-function format; the by-nature format groups costs by type (material, wages, depreciation, services).

Notes must disclose: accounting policies, valuation methods, depreciation methods, provisions, contingent liabilities, and post-balance-sheet events.

Statutory audit thresholds (two of three for two consecutive periods): assets > 40 million CZK, turnover > 80 million CZK, employees > 50; public-interest entities always audited.

Consolidated financial statements: parent with control consolidates subsidiaries; exemptions for small groups below two of three thresholds (assets 40M, turnover 80M, 50 employees).

Post-balance-sheet events: adjusting events provide evidence of conditions at the balance-sheet date and are recognised; non-adjusting events are disclosed only.

Corporate income tax rate is 21% (from 2024); personal income tax uses 15% and 23% brackets; withholding tax on dividends is 15%.

Tax base = accounting profit + non-deductible expenses − non-taxable income − items taxed separately; rounded down to whole thousands of CZK.

Non-deductible items: gifts outside §20(8), fines and penalties, representation expenses, personal use of business assets, and undocumented expenses.

Tax depreciation methods: straight-line and accelerated; taxpayer may switch from accelerated to straight-line but not vice versa; assets are classified into 1–6 depreciation groups.

Tax loss carryforward: 5 years; claimed in the earliest year first; cannot be claimed in the year of liquidation or transformation.

Tax records (daňová evidence): income and expenses on a cash basis; track receivables, payables, inventory, and assets; used by sole traders under the turnover threshold.

Tax return deadline: 3 months from the end of the tax period; 4 months if filed electronically; 6 months if prepared by a tax adviser or if the entity is audited.

Transfer pricing: related-party transactions must be at arm's length; documentation follows OECD Guidelines and §23(7) ZDP; country-by-country reporting for large groups.

VAT rates: standard 21%, reduced 12% (from 2024) for food, medicines, books, accommodation, and selected services; 0% for exports and intra-community supplies.

Registration threshold: mandatory when turnover exceeds 2,000,000 CZK in 12 consecutive months; voluntary registration possible; effective from the 3rd working day after exceeding the threshold.

VAT return: filed monthly or quarterly (quarterly only if turnover ≤ 10 million CZK); deadline is the 25th day after the end of the period; filed electronically.

Input VAT deduction: requires taxable supply, valid tax document with mandatory elements (§29), use for economic activity, and no exclusion under §75.

Reverse charge: applies to construction works, scrap, selected electronics, and cross-border B2B services under §9(1); both parties report VAT.

Exempt supplies: without credit (financial services, insurance, education, healthcare, letting of real estate) and with credit (exports, intra-community supplies, international transport).

Control statement: filed with the VAT return; reports B2B invoices over 10,000 CZK, imported goods, and selected transactions.

Other indirect taxes: excise duties on alcohol, tobacco, and fuel (Act 353/2003); energy tax; road tax for business vehicles.

Employee social insurance: 7.1% (6.5% pension + 0.6% sickness); employer: 24.8% (21.5% pension + 2.1% sickness + 1.2% unemployment); health insurance 9% (4.5% + 4.5%).

Income tax: 15% on gross up to 48× average wage (monthly threshold 146,424 CZK in 2024); 23% above; taxpayer reliefs applied via payroll or annual return.

Taxpayer reliefs: basic 30,840 CZK/year; spouse 24,840 CZK if income ≤ 68,000 CZK; child benefit 15,204 / 22,320 / 27,840 CZK for first, second, third and further children.

Minimum wage (2024): 18,900 CZK/month or 112.50 CZK/hour; guaranteed wage set by government decree for eight work categories.

Sick leave: first 14 days paid by employer at 60% of reduced earnings; from day 15 ČSSZ pays 60% of daily assessment base.

Maternity leave: 28 weeks (37 weeks for multiple births); 70% of daily assessment base; parental leave up to 3 years of child's age.

Termination: notice period 2 months; severance pay 1× average monthly earnings for <2 years, 2× for 2–5 years, 3× for 5–10 years, 4× for 10+ years.

Payroll reports: monthly reports to health insurers by the 20th; ELDP submitted annually to ČSSZ by 31 January for the previous year; payroll records retained 30 years.

Cost classification: by nature (material, wages, depreciation, services) and by purpose (direct/indirect, production/administrative).

Full costing allocates direct and indirect costs; variable costing allocates only variable costs and treats fixed costs as period costs.

Overhead rate = total overhead / allocation base (direct labour hours, machine hours, material costs, or activity drivers).

Break-even point = fixed costs / contribution margin per unit; contribution margin = price − variable cost per unit; margin of safety = (actual sales − break-even sales) / actual sales.

Standard costing: standard cost = standard quantity × standard price; variances are price, quantity (efficiency), and overhead variances; favourable vs. unfavourable.

Budgeting: top-down, bottom-up, zero-based, and rolling budgets; flexible budgets adjust for actual volume; master budget combines operating and financial budgets.

Responsibility centres: cost centre (costs), profit centre (revenues and costs), investment centre (profit and capital employed); ROI = operating profit / invested capital.

KPIs: ROI, residual income, EVA = NOPAT − WACC × invested capital; balanced scorecard perspectives: financial, customer, internal, learning and growth.

Statutory audit governed by Act 93/2009 Sb. and KA ČR; auditors must be members of KA ČR and comply with ISA as adopted by KA ČR.

Audit opinion types: unmodified, qualified, adverse, and disclaimer; emphasis of matter and other matter paragraphs do not modify the opinion.

Audit risk model: audit risk = inherent risk × control risk × detection risk; auditor reduces detection risk through substantive procedures and tests of controls.

Materiality: overall materiality typically 5% of profit before tax, 0.5–1% of revenues, or 1–2% of total assets; performance materiality is set lower.

Internal control components (COSO): control environment, risk assessment, control activities, information and communication, monitoring activities; segregation of duties is a key preventive control.

Ethics: independence in mind and appearance; threats include self-interest, self-review, advocacy, familiarity, and intimidation; safeguards include rotation and second partner review.

Audit documentation retained 10 years from the date of the auditor's report; engagement quality control review required for listed and public-interest entities.

Auditor rotation: for public-interest entities, the audit firm rotates after 10 years (extendable to 20 with tender, or 24 with joint audit) under EU Regulation 537/2014.

Accounting entities under §1 of Act 563/1991 Sb.: legal entities with registered office in the Czech Republic, foreign entities doing business in the Czech Republic, and individuals with turnover over 25 million CZK or keeping books voluntarily.

Accounting period is 12 consecutive months; may be calendar or fiscal year; first period may be shorter but must end on the last day of a calendar month.

Financial statements filed with the collection of documents of the registry court within 12 months of the balance-sheet date; filing is electronic.

Tax Code (280/2009 Sb.): tax return deadline 3 months from end of tax period; extension to 4 months for electronic filing and 6 months if prepared by a tax adviser or audited.

Penalties: late filing 0.1% of tax assessed per day up to 5% of tax; late payment interest 14% p.a. plus repo rate.

Anti-money laundering: Act 253/2008 Sb. requires customer due diligence, beneficial owner identification, and suspicious transaction reporting to FAÚ; record retention 10 years.

GDPR: personal data processed lawfully, fairly, transparently; payroll data retained 30 years for social security; data subject rights include access, rectification, and erasure.

Professional bodies: Chamber of Auditors (KA ČR), Chamber of Tax Advisers (KDP ČR), Union of Accountants (Svaz účetních); membership mandatory for auditors and tax advisers.