The importance of small and medium-sized enterprises is growing daily on a global scale. Their actions create an impact on the economy of each country, which can be seen through the generation of income and employment of individuals. Due to the presence of their increasing number on the market, there is a need to regulate their business. Usually there is a variety of standards, laws and regulations that regulate accounting systems and adopt rules for quality performance of activities. Their scope and content can vary between countries and their diversity can create positive or negative effects. The differences in accounting regulations of selected countries are analyzed in this thesis and covere the topic „Comparison of the normative framework for financial reporting of small and medium-sized enterprises in Croatia and Austria“. Financial reporting represents an essential element of business of both large and small and medium-sized enterprises. The information from the financial statements can be used to improve the quality of each business and to analyze the security and performance of the company. In addition to the accounting rules governing financial reporting, a great impact on their assembly have tax regulations. The diversity of tax regulations may lead to different effects on the items of the financial statements. The greatest impact is seen in the taxation of personal income and profits of the enterprises. Different tax rates in different degrees impact tax bases and thus create a higher or lower tax liability. The Republic of Croatia and the Republic of Austria prescribe tax regulations that are adjusted to their own requirements of each country. Their comparison shows the application of different tax regulations and financial reporting standards in small and medium-sized enterprises.