CERTIFICATION OF COMPANY BOOKS BEFORE END OF YEAR
Similar to previous years, as we approach the year-end, we present to your attention the requirements for the annual certification of company commercial books (in Turkish, “şirketin ticari defterleri”). According to Article 64 of the Turkish Commercial Code numbered 6102 (the “TCC”), all real and legal persons are obliged to keep their commercial books in line with the provisions of the Tax Procedural Code, regulating the procedures of bookkeeping, registration time, renewal, commencement and closing certification of the books.
This Newsletter provides information relating to the certain provisions of the Communiqué on Commercial Books (in Turkish, “Ticari Defterlere İlişkin Tebliğ”) (hereinafter referred to as the “Communiqué”), on the commencement and year-end closing certifications of the commercial books of joint stock companies and limited liability companies incorporated in Turkey. The Communiqué was published in the Official Gazette dated 19 December 2012 and numbered 28502 in accordance with the TCC.
By virtue of Articles 13 and 16 of the Communiqué, the certifications of the commercial books listed below shall be completed for each fiscal year before a Public Notary:
- General Journal (in Turkish, “Yevmiye Defteri”)
- General Ledger (in Turkish, “Defteri Kebir”)
- Inventory Book (in Turkish, “Envanter”)
- Board of Director’s Resolution Book as for the joint stock companies and Managers’ Resolution Book as for the limited liability companies (in Turkish, “Yönetim Kurulu Karar Defteri”/ “Müdürler Kurulu Karar Defteri”)
- General Assembly’s Resolution Book (in Turkish, “Genel Kurul Müzakere ve Toplantı Defteri”)
- Share ledger (in Turkish, “Pay Defteri”)
Kindly note that as per Article 11 of the Communiqué, for limited liability companies, the board of managers’ resolutions may be kept in the general assembly’s resolution book as well as in a separate board of managers’ resolution book. In case a separate board of managers’ resolution, commencement and closing certification shall be made in accordance with the provisions for the Board of Directors’ Resolution Book of the joint stock companies.
I. Certification of Company books to be maintained physically
The commencement certification of the books (in Turkish, “defterlerin açılış onayı”) kept physically by the commercial companies formed in Turkey shall be realized by a notary until the end of the month preceding the company’s next activity year. In this respect, for those companies whose accounting period corresponds to the calendar year, the commercial books to be used in the year 2022 shall be certified by a notary until the close of business on 31 December 2021, the last business day of current year.
The share ledger and the resolution book for general assembly meetings currently used by the company may continue to be used in the next activity periods without any commencement certification, as long as they have sufficient number of blank pages. In the case of the company books run out of blank pages before the end of the activity year or in the event the company is obliged to use new company books for any reason, they must obtain a commencement certification before beginning to use them.
II. Closing certification of the Company books to be maintained physically
Pursuant to the provisions of the Communiqué, closing certification is compulsory solely for the general journal and board of directors’ resolution book.
- Closing certification for general journals may be obtained from a notary till the end of the sixth month in the beginning of the activity period.
- Closing certification for the book of board of directors’ resolutions may be obtained until the end of the first month in the beginning of the activity period.
III. Renewal certification of the company books
For board of directors’ resolution book, general journal, inventory book and general ledger, companies who would like to continue to use the same books in the following year may obtain interim approval from the notary during the first month of the new accounting period provided that such books have a sufficient number of blank pages. In such cases, there will be no need to repeat the commencement and closing certification procedures.
IV. Certification of the company books maintained electronically
Pursuant to paragraph 3.2.1 of the General Communiqué on Electronic Books (in Turkish, “Elektronik Defter Genel Tebliği”), the taxpayers who are under the obligation of issuing e-invoices and the companies who are subject to independent auditing under the paragraph 4 of Article 397 of the TCC are subject to e-bookkeeping rules.
Commencement or closing certification is not a requirement for company books maintained electronically, i.e. the general journal and general ledger. According to the Communiqué, obtaining the e-book certificate for the first month of the accounting period will amount to the commencement certification, obtaining the e-book certificate for the last month will amount to the closing certification, and obtaining an e-book certificate for other months will amount to the notary certification of the books. However, the companies which begins maintaining e-books within the accounting period or the calendar year must obtain closing certifications for their former physical books.
The companies that maintain e-books, however, are required to physically maintain the books except for the general journal and the general ledger and obtain their certifications accordingly.
V. Penalty due to non-compliance with the obligation of certification
We would like to kindly remind you that failure to obtain commencement and closing certifications for the company’s commercial books is subject to an undue fine (in Turkish, “Usulsüzlük dereceleri ve cezaları”) pursuant to Article 352 of the Tax Procedure Law and also an administrative fine as per Article 562 of the Turkish Commercial Code. Furthermore, please also note that as per Article 222 of Turkish Code of Civil Procedure, unless the company’s commercial books were duly certified, recorded and maintained in compliance with the relevant laws, these books would not be deemed as acceptable evidence for the company in case of a dispute.
In light of the above, kindly note that upon your request, we will be pleased to assist you, if there are sufficient blank pages in the board of director’s resolution book for joint stock companies or resolution book of the board of the managers for limited liability company for the new fiscal year, commencement and year-end certification shall be completed before a Notary by providing a certificate of trade registry (in Turkish, “Ticaret sicil tasdiknamesi”).
Our Law Firm remains at your disposal for any further clarifications you may need.