Czech Accounting Profession Certification key terms

Double-entry bookkeeping required for Czech accounting units, where every transaction is recorded on at least two accounts so that total debits equal total credits and the books stay balanced.

The chart of accounts issued by regulation that groups accounts into classes 0 to 9 and defines which synthetic accounts an accounting unit must or may use for statutory reporting.

The binding framework chart of accounts setting account classes, groups and synthetic accounts; entities adapt it into their own chart of accounts with analytical accounts as needed.

A sub-account created by the entity under a synthetic account to track detail such as individual customers, tax rates or cost centres while still rolling up to the statutory account.

The chronological journal in which all accounting entries are recorded in order, showing debits, credits, amounts and a link to supporting documents; it must be continuous and complete.

The general ledger that groups journal entries by account, providing opening balances, movements and closing balances for each synthetic and analytical account.

The source document evidencing an accounting transaction; it must be complete, verifiable and carry prescribed elements before the entry is recorded in the books.

A trial balance listing opening balances, period debits and credits and closing balances per account, used to prove the books balance before preparing statements.

The statutory financial statements comprising balance sheet, profit and loss account, notes and, where required, cash flow statement and statement of changes in equity.

The balance sheet showing assets, liabilities and equity at the reporting date, with assets and liabilities classified by type and remaining maturity.

The profit and loss statement presenting revenues, expenses and the result of operations by prescribed categories such as operating, financial and extraordinary activities.

The notes to the financial statements, disclosing accounting policies, valuation methods, commitments and other information needed for a fair view of the entity.

The overriding requirement that financial statements faithfully and honestly reflect the entity's financial position and performance, taking precedence over formal presentation rules.

The profit or loss for the period, calculated as revenues less expenses and closed to retained earnings or accumulated losses at the balance sheet date.

The closing of the books at period end, transferring profit or loss and balancing accounts so that the next period starts with correct opening balances.

The prudence principle requiring recognition of expected risks and losses and only realised gains, so that assets and income are not overstated.

Liabilities recognised for present obligations of uncertain timing or amount, such as warranty or restructuring provisions, created by a charge to expenses.

Accrual and deferral adjustments that allocate revenues and expenses to the period to which they relate, regardless of when cash is paid or received.

Simplified tax records kept by individuals, tracking income, expenses, receivables, payables and assets, used to determine the income tax base rather than a full double-entry system.

A flat percentage of income that a self-employed person may deduct as expenses in tax records instead of substantiating actual costs, with the percentage depending on the activity.

An expense incurred to generate, secure and maintain taxable income that meets statutory conditions and may therefore reduce the corporate or personal income tax base.

Value added tax levied on supplies of goods and services by taxable persons, collected at each stage of the chain with input tax deducted by registered payers.

A registered taxable person's right to deduct input VAT on purchases used for taxable economic activity, subject to conditions on the tax document and its content.

Reverse-charge mechanism under which the customer, not the supplier, reports and pays the VAT on specified supplies such as construction works, with the customer also deducting input tax where entitled.

A periodic VAT control statement filed by VAT payers reporting selected transactions, including supplies to and from other EU states, to help the tax authority cross-check returns.

The tax return filed with the tax authority declaring the tax liability for a period, with self-assessment and payment due by the statutory deadline.

An advance income tax payment made during the year based on the last assessed tax, later settled against the final tax liability shown in the annual return.

The payroll function covering calculation of gross pay, deductions, net pay, statutory contributions and the records required for each employee.

A historical Czech payroll base for personal income tax equal to gross salary plus employer social and health contributions; it has been abolished and must not be used for current periods.

Czech social security contributions paid by employers and employees to fund pensions, sickness and unemployment benefits, calculated on the assessment base.

Czech public health insurance contributions paid by employers, employees and self-employed persons, calculated on the assessment base and remitted to health insurers.

A withholding tax deducted at source from specified payments such as certain dividends or small payments, finally settling the tax liability without annual assessment.

The calculation of costs per unit of output or activity, using methods such as absorption, variable or activity-based costing to support pricing and performance evaluation.

A quantified plan of revenues, costs and cash for a future period, used to coordinate activities and to compare actual results against plan through variance analysis.

A responsibility centre to which costs are assigned, enabling managers to be held accountable for spending and allowing internal cost allocation and reporting.

An independent examination of financial statements by a statutory auditor, expressing an opinion on whether they give a true and fair view under the applicable framework.

The auditor's formal conclusion in the audit report, which may be unmodified or modified as qualified, adverse or a disclaimer, depending on the evidence obtained.

The threshold of misstatement or omission that could influence users' economic decisions, used by auditors to plan procedures and evaluate uncorrected errors.

The entity's systems, policies and procedures designed to safeguard assets, ensure reliable reporting and support compliance with laws and regulations.

The professional code requiring integrity, objectivity, confidentiality and competence, and setting rules on independence and conflicts of interest for accountants and auditors.

The core Czech statute governing bookkeeping, valuation, financial statements, filing and audit obligations for accounting units, supported by implementing decrees and standards.