Keeping accounting books (full accounting) is an obligation for commercial companies and other legal persons and, among others, for individuals and partnerships of individuals whose net revenue for the previous financial year reached at least the equivalent of EUR 2,500,000 (Article 2(1) of the Accounting Act (ustawa o rachunkowości)), but it is also the choice of some businesses aiming for professional financial management (Article 2(2)). Every accounting entry is based on an appropriate accounting document (dowód księgowy), which records the business transaction carried out. Without proper documentation, accounting cannot be kept reliably in line with the applicable law.
Accounting documents play a key role in the accounting system of every business. They are not only the legal basis for the entries made, but also serve as a tool for controlling and verifying the business transactions carried out. A proper understanding of their functions and legal requirements is essential for every business owner.
The nature and functions of accounting documents
Accounting documents are the necessary basis for making entries in the accounting books of every business. Their main function is to record business events that can be expressed in monetary terms and that cause changes in the company's balance sheet. Every business transaction must be properly documented so that it can be correctly recorded in the accounting system.
Accounting documents must be reliable, complete and free from arithmetical errors, and erasures and alterations in them are not allowed (Article 22(1) of the Accounting Act). Every accounting document should be checked for form and arithmetic and for substance according to the rules adopted by the entity
Business transactions cover a wide range of a company's activities, from basic trade transactions, through financial operations, to internal activities of the organisation. Buying goods or services is one of the most common business transactions, which must be properly documented by invoices, bills or other documents confirming the transaction.
Paying cost invoices received from suppliers is another example of a business transaction that must be properly documented. Such transactions are confirmed by bank statements, transfer orders or other bank documents confirming the payment.
Transferring finished goods from production to the warehouse and selling products, goods or services are transactions that require particular care when documenting them. Warehouse documents, sales invoices and other trade documents form the basis for recording these transactions correctly in the accounting books.
Business transactions are all events within the scope of a company's activity that can be expressed in monetary terms and that cause changes in the balance sheet. Each such transaction requires an appropriate accounting document as the basis for the entry in the accounting books
Scrapping a fixed asset, receiving payment from a customer, receiving money from a loan taken out or granting a loan are examples of business transactions that require particular care when documenting them. Each of these transactions has its own documentation requirements and must be properly documented in line with the applicable rules.
The control function of accounting documents is as important as their documentation function. Accounting documents make it possible to verify the correctness of business transactions, check compliance with the applicable rules and check the completeness of the accounting documentation. Proper documentation also makes it possible to carry out an examination of the financial statements by a statutory auditor (biegły rewident) or an inspection by the tax authorities.
Classification of accounting documents by origin
Accounting documents can be divided into three basic categories according to their origin and nature. The first type is external third-party documents, which the business receives from its counterparties in the course of its activity. These are documents issued by external entities the company works with.
External third-party documents include invoices received from suppliers, bills for services, customs documents for imported goods and debit notes issued by counterparties. These documents are the basis for recording operating costs, input VAT and settling liabilities towards suppliers.
External third-party documents are documents received from counterparties, which are the basis for recording transactions with external entities. They must meet all formal requirements set out in accounting law
The second category is external own documents, which the business issues itself and hands over to its counterparties. These are documents confirming the sale of goods or services, the granting of loans or other transactions in which the company is the issuer of the document.
Sales invoices, corrective invoices, bills issued to customers and documents relating to contracts of mandate (umowa zlecenia) and contracts for specific work (umowa o dzieło) are examples of external own documents. These documents are the basis for recording sales revenue, output VAT and settling receivables from customers.
The third category is internal documents, which are the basis for the company's internal transactions. These are documents prepared by the company itself to document transactions that do not involve external entities.
Internal documents record the company's internal transactions, such as warehouse transfers, cost allocations or accounting corrections. They must be prepared in line with the company's internal procedures and the requirements of the Accounting Act
Warehouse documents, cash statements, off-account records and various internal settlements are examples of internal documents. These documents are particularly important for the proper functioning of the company's internal control system.
Under the Accounting Act (Article 20(3)), entries in the accounting books may also be made on the basis of collective, corrective, substitute and settlement accounting documents prepared by the entity. These special types of documents allow accounting documentation to be managed efficiently for mass transactions or specific accounting situations.
Detailed characteristics of types of accounting documents
Invoices are the basic type of accounting document in business. They are documents confirming the sale of goods or services, which must meet certain formal requirements. VAT taxpayers are, as a rule, required to issue structured invoices in KSeF (National e-Invoicing System) (Article 106ga(1) of the VAT Act) – the accounting document is then the invoice with the number assigned in that system. Corrective invoices are used to correct errors in original invoices or to adjust the sales value in the case of returns or discounts.
Bills (rachunki) are documents similar to invoices, but often used for smaller transactions or services. Customs documents play a key role in import and export transactions, forming the basis for settling customs duties, taxes and other charges related to foreign trade.
The monthly fiscal report from a cash register is an accounting document confirming the sales recorded in the cash register, regardless of the form of payment. It must be prepared regularly and form the basis for recording revenue from retail sales
The monthly fiscal report is a particularly important document for businesses engaged in retail sales. It is a collective accounting document confirming the sales recorded in the cash register (kasa fiskalna) in a given month (cash and cashless).
Off-account records are a form of documenting transactions that do not require detailed cash settlement. Debit notes are used to document additional costs or charges not included in the original documents.
Documents confirming postal charges or stamp duty are accounting documents necessary for the correct settlement of operating costs. Bank statements are the basis for recording financial transactions carried out through bank accounts.
Cash statements record the company's cash transactions and are the basis for checking the cash balance and recording cash transactions. Warehouse documents are necessary for proper inventory management and for recording changes in stock.
Bills relating to contracts of mandate and contracts for specific work require particular attention because of the specific rules for settling taxes and social security contributions. They must contain all elements required for accounting documents
Bills relating to contracts of mandate and contracts for specific work are a specific category of accounting documents, which require particular attention because the rules for settling taxes and social security contributions differ from those for standard invoices for services.
Legal requirements for the content of accounting documents
Not every document can be regarded as an accounting document within the meaning of accounting law. For a document to form the basis for an entry in the accounting books, it must meet certain formal and substantive requirements set out in the Accounting Act.
Under the law, an accounting document must specify the type of document and its identification number. This element allows the document to be clearly identified in the accounting system and makes it easier to archive and find.
An accounting document must identify the parties to the business transaction, including the names and addresses of the counterparties. This information is necessary to identify the entities taking part in the transaction correctly
Identifying the parties to the business transaction, including the names and addresses of the counterparties, is another mandatory element of an accounting document. This information allows the entities taking part in the transaction to be clearly identified and is necessary for correct tax settlement.
A description of the transaction and its value, also expressed in physical units where possible, is a key element of an accounting document. The description must be detailed enough to allow the transaction to be classified correctly.
The date of the transaction is a mandatory element that determines when the business event occurred. If the document was prepared on a different date from the date of the transaction, the date of preparation must also be shown.
The signature of the issuer of the document and of the person to whom assets were issued or from whom they were received is, as a rule, a mandatory element confirming the authenticity of the document (Article 21(1)(5)). It may be omitted if this follows from other regulations (for example, invoices do not require a signature), and where the document does not record the transfer or receipt of an asset, it may be replaced by marks that make it possible to identify these persons (Article 21(1a) and (4))
The signature of the issuer of the document and of the person to whom assets were issued or from whom they were received is an element confirming the authenticity and validity of the document. These signatures are particularly important during an inspection or an examination of the financial statements.
Confirmation that the document has been checked and classified for recording in the accounting books, called booking instruction (dekretacja), is an element added by the accountant or the person responsible for keeping the books. The booking instruction includes the month and the method of recording the document in the accounting books and the signature of the person responsible for these indications (Article 21(1)(6)); it does not have to be placed on the document if this follows from the technique of documenting accounting entries (Article 21(1a)(2)). The booking instruction is just one of the stages a document passes through — we describe the flow of accounting documentation in a separate guide.
Procedure for checking and accepting accounting documents
The process of checking accounting documents is key to ensuring that the accounting books are kept correctly. Every accounting document must go through a verification procedure before it is entered into the accounting system. This procedure covers a check for form and arithmetic and a check for substance.
The check for form and arithmetic consists of verifying whether the accounting document contains all elements required by the Accounting Act. It covers checking the completeness of the data, arithmetical correctness and legibility of the document.
- Check that all required elements of the accounting document are present
- Verify the counterparty data and its consistency with the records
- Check the arithmetic on the document
- Check that the dates match the accounting period
- Verify the signatures and the authority of the signatories
- Make the booking instruction showing how the document is to be recorded in the accounting books
The substantive check of an accounting document consists of assessing whether the documented transaction is justified and economically appropriate. The person responsible for this check must assess whether the transaction falls within the company's scope of activity and whether it is economically justified.
The booking instruction for an accounting document must be made by the person responsible for these indications, who confirms it with their signature (Article 21(1)(6)). The booking instruction includes the accounts on which the transaction will be recorded and the month of recording
The booking instruction is a technical process of determining how the transaction is to be recorded in the accounting books. It includes the relevant accounts, the amounts to be posted and the month in which the transaction should be recorded.
The procedure for approving accounting documents must be set out in the company's internal rules. It should specify precisely who is authorised to approve particular types of documents and what the limits of their authority are.
| Type of document | Checked by | Approved by | Required elements |
|---|---|---|---|
| Cost invoices | Accountant | Chief accountant | Formal and substantive check |
| Sales invoices | Sales department | Accountant | Consistency with the contract and prices |
| Bank documents | Accountant | Chief accountant | Consistency with the statement |
| Cash documents | Cashier | Accountant | Check of the cash balance |
The internal control system should ensure that no accounting document is entered in the accounting books without proper checking and approval. This control is particularly important in larger companies, where different people are responsible for different aspects of the business.
Rules for keeping accounting books in Polish and in Polish currency
The Accounting Act clearly provides that accounting books must be kept in Polish and in Polish currency. This requirement is fundamental to ensuring that the accounting is transparent and can be checked by the Polish supervisory authorities.
The requirement to keep the books in Polish (Article 9 of the Accounting Act) means that accounting entries and descriptions of business transactions in the books must be made in Polish. The accounting documents themselves may be in a foreign language – in that case the company must provide a reliable translation at the request of the supervisory authorities or the statutory auditor (Article 21(5)).
Accounting documents expressed in foreign currencies must include a conversion of their value into Polish currency at the exchange rate applicable on the day of the business transaction. The result of the conversion must be shown directly on the document
Converting foreign currencies into Polish currency is mandatory for all accounting documents expressed in foreign currencies. The exchange rate to be used is the rate applicable on the day of the business transaction, not on the day the document is prepared or the day of posting. Under Article 30(2) of the Accounting Act, this is the rate actually applied on that day (when buying or selling currencies and paying receivables or liabilities) and, in other cases, the average NBP (National Bank of Poland) rate from the day before the day of the transaction.
The result of converting foreign currencies into Polish currency must be shown directly on the accounting document. The exception is where the data processing system ensures automatic conversion of foreign currencies into Polish currency and the conversion is confirmed by an appropriate printout.
Automatic currency conversion by the IT system is allowed provided that the system generates an appropriate printout confirming the conversion. Such a printout must include information on the exchange rate applied and the result of the conversion.
At the request of the supervisory authorities or the statutory auditor, the company must provide a reliable translation into Polish of the content of the documents in a foreign language indicated by them. The Act requires the translation to be reliable, but does not stipulate that it must be done by a sworn translator.
The translation of accounting documents into Polish must be reliable (Article 21(5) of the Accounting Act); the provision does not require a sworn translator. The costs of translation are borne by the company required to keep accounting books
The requirement to keep the books in Polish currency aims to ensure the comparability of financial data and to make inspections by the tax authorities easier. All values must be expressed in Polish zlotys, which allows the company's financial position to be assessed unambiguously.
A company importing goods from Germany receives invoices in euro. Each such invoice must be converted into Polish zlotys – when the liability is recognised, at the average NBP exchange rate from the day before the day of the business transaction (Article 30(2)(2) of the Accounting Act). The accountant shows the result of the conversion directly on the invoice, stating the exchange rate applied and the amount in zlotys to be recorded in the accounting books.
Archiving and storing accounting documents
Proper storage of accounting documents is an obligation of every business keeping accounting books. The rules set out precise requirements for the storage period, the method of archiving and the conditions of storing accounting documentation. We classify and post accounting documents for clients who use our bookkeeping services.
Accounting documents must be stored in a way that ensures their durability and legibility throughout the period required by law. Paper documents require appropriate storage conditions that protect them against destruction, loss or unauthorised access.
- Accounting documents must be arranged chronologically by transaction date
- Each document requires an appropriate description and numbering to make it easier to find
- The document archive must be protected against access by unauthorised persons
- The archiving system should make it possible to find a specific document quickly
- Electronic documents require regular backups
Storing documents in electronic form is allowed provided that their integrity and authenticity are ensured. Electronic systems must be protected against unauthorised access and accidental loss of data.
Electronic systems for storing accounting documents must make it possible to reproduce the documents in legible form throughout the storage period. Regular backups are also required
Controlling access to the archive of accounting documents is key to the security of the documentation. Only authorised persons should have access to accounting documents, and each access should be properly recorded.
Archiving procedures should be set out in the company's internal rules. They should specify precisely how documents are transferred to the archive, how they are sorted and how records of archived documents are kept.
The disposal of accounting documents after the end of the storage period must be carried out in line with the applicable rules. The disposal process should be properly documented, and documents containing personal data must be destroyed in a way that prevents their reconstruction.
Control and verification of accounting documents
The system for controlling accounting documents is the foundation of proper accounting. This control covers both formal and substantive aspects, ensuring that all business transactions are properly documented and recorded.
The formal control of accounting documents consists of checking whether the documents contain all elements required by the Accounting Act. This control must be carried out before the document is entered into the accounting system.
The substantive verification of accounting documents requires assessing the economic justification of the documented transactions. The person carrying out this control must have appropriate knowledge of the company's activity and of accounting principles.
Accounting documents must be checked by persons with appropriate qualifications and authority. Each check should be documented by appropriate notes on the accounting document
The internal control system should ensure that all accounting documents go through defined verification procedures. These procedures should be adapted to the specific nature of the company's activity and to the type of accounting documents.
Documenting the checks carried out should be set out in the rules adopted by the entity (the booking instruction with a signature is mandatory – Article 21(1)(6)) and should include the signatures of the persons carrying out the check and the date it was carried out. These notes are evidence that the document was properly checked before being entered in the accounting books.
Checking the continuity of the numbering of accounting documents is particularly important for the company's own documents. The numbering system should ensure that each document receives a unique identification number and that any missing number is easy to detect.
