A formal requirement related to the submission of financial statements is the signature of the person responsible for maintaining the accounting records of the entity – typically the individual serving as the accountant. However, before the financial statement is submitted for review by the shareholders, it is necessary to obtain the signatures of all managers of the entity or members of its governing body – most often members of the management board or general partners.
It may happen that one of the management board members refuses to sign the financial statement. There can be various reasons for such a decisive stance, such as internal conflicts within the board, concerns about the accuracy of the accounting policies, or the fact that the board member did not serve during the financial year covered by the statement. Regardless of the reason, this situation places the management board in a difficult position- especially in the context of obligations related to the timely approval and submission of the statement to the National Court Register (KRS). So how can this impasse be resolved?
Can a financial statement be signed by only one board member?
Although in most cases the financial statement is signed by all members of the management board, it sometimes happens that the document is signed by only one or several members – without the participation of the entire board. Such action is permitted under the law, and submitting such a statement to the KRS is valid, provided that additional conditions are met.
In this case, the remaining members must submit a declaration stating that the financial statement meets the requirements stipulated by the Accounting Act. The law does not specify a particular form for this declaration – it may be submitted in writing or electronically, and it is acceptable to use a qualified electronic signature, a trusted profile (profil zaufany), or a personal signature. It is essential that the declaration is attached to the financial statement submitted to the Repository of Financial Documents.
However, a management board member may refuse to submit such a declaration – in which case they must provide a written justification for their decision. In practice, this issue often arises when the board includes foreign nationals – due to the lack of a qualified electronic signature or trusted profile, they are unable to sign the financial statement and therefore opt to refuse to do so.
Refusal may also be linked to more serious concerns – for instance, suspected irregularities in the bookkeeping. Such a refusal, especially when properly substantiated, may serve as a significant warning signal for both shareholders and the company’s business partners.
The above rules also apply to the management report, which is prepared and signed by the management board.
Consequences
Upon receiving the financial statement for review, shareholders should first examine it from a formal standpoint, including compliance with the requirement for management board signatures. A statement that does not meet the requirements of the Accounting Act is considered formally defective. As such, even if shareholders choose to ignore the deficiencies and adopt a resolution approving the statement – and subsequently allocate profit or cover losses based on it- such actions may be challenged, and the resolutions adopted may be deemed invalid and overturned by the court.
It is important to remember that management board members bear civil and criminal liability. It is easy to imagine a scenario in which the refusal to sign the statement or the absence of the required declaration prevents the effective and timely filing of documentation with the KRS. This may, in turn, expose the company to legal and financial repercussions – such as monetary penalties, delays in confirming the financial result, or a loss of credibility with business partners or financial institutions. If the company suffers damage as a result of such omissions or delays, it may have grounds to seek compensation from the board member who, through refusal or inaction, contributed to the failure to fulfill statutory obligations.
The insubordination of a board member may also lead to their dismissal from office. Furthermore, if the individual is simultaneously employed by the company under an employment contract or another form of engagement due to their board role, their contract may be terminated. A resolution to dismiss the board member will be especially warranted if they are the sole board member and, despite their obligations, fail to take any action to sign the financial statement or submit the required declaration. Lack of contact with such an individual, their persistent absence, or total inactivity can lead to a decision-making paralysis within the company, preventing the fulfillment of registration obligations and the approval of the statement within the statutory deadline. In such a case, it may not only be justified but even necessary to remove the person from their position to restore the board’s operational capacity and mitigate risk for the company.
It should be emphasized that the above considerations apply to situations in which a board member refuses to sign the financial statement or submit the required declaration without reasonable grounds or solely to obstruct the company’s operations. However, if their objections are substantive in nature, the board member should seek to clarify them – for instance, in cooperation with the accounting department or the statutory auditor. In such circumstances, imposing consequences on the board member would not be warranted.
We highlight that the appropriate course of action in the event of a refusal to sign the financial statement – as well as the related actions by shareholders and other board members – depends on the specific circumstances of each case and requires a detailed analysis of the facts and applicable legal provisions. As a law firm specializing in advising entrepreneurs and with experience in supporting clients in the preparation, signing, and submission of financial statements, we remain at your disposal.
Do not hesitate to contact us.
