As of November 1, 2015, Book 2 of the Dutch Civil Code (BW) has been amended for annual accounts and their publication periods. A new category of enterprise has been introduced: micro-enterprises. The criteria for small, medium, and large enterprises have been adjusted. The traditional 13-month publication period has been shortened to 12 months. The preparation period has been shortened to 10 months. Finally, enterprises in certain sectors are subject to an additional publication obligation regarding payments made to government bodies.<\/p>\n
The changes will apply to fiscal years starting January 1, 2016. They may be applied earlier to take advantage of the new exemptions.<\/p>\n
Think Small First<\/strong><\/p>\n The Implementation Act Annual Accounts Directive<\/a>, adopted September 30, 2015, effective November 1, 2015, implements the European directive<\/a> which aims to reduce administrative burdens. The focus is on small and medium-sized enterprises (SMEs), which play a central role in the Union's economy. This focus is encapsulated in the adage "think small first," which serves as the basis for the European Commission's policy in its legislative agenda. This has translated into the introduction of "micro-enterprises." Micro-enterprises have limited resources to meet the demanding regulatory requirements. They are not entirely exempt from publication requirements, so that sufficient transparency is maintained over their business transactions and financial situation to protect stakeholders. The question is whether accountants will now also charge less for their work!<\/p>\n Exemptions<\/strong><\/p>\n The following categories of companies are distinguished:<\/p>\n A company may apply the exemptions if it meets two of the three criteria for two consecutive years. A company falls into a larger category if it subsequently meets the conditions of that (larger) category for two consecutive years. The table below illustrates this: the first line indicates how a company qualifies in a given financial year, the second line indicates which exemption regime it may apply (note: year 1 is ignored, as separate conditions apply for that year):<\/p>\n The exemptions are, in general terms, as follows:<\/p>\n Limited Explanation<\/td>\n <\/p>\n In case of stock exchange listing: corporate governance report<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n The further limitation in accounting for microenterprises compared to small businesses primarily concerns even fewer items in the balance sheet and profit and loss account. Moreover, these items may often be consolidated, for example, all debts are reported under a single item. Explanatory notes may also be omitted.<\/p>\n Small businesses are required to report less: this restriction relates, among other things, to the omission of disclosures about investments and the omission of the indication of profit certificates and profit allocation.<\/p>\n Listed companies, credit institutions, insurers and other public interest entities to be designated are not eligible for the aforementioned exemptions.<\/p>\n The Management Report is the new name for the annual report. The report is subject to the auditor's review, which requires the auditor to detect and report any material misstatements in their report.<\/p>\n Stop it! Special statement regarding payments to governments<\/strong><\/p>\n Some companies will be subject to additional reporting requirements. These are large, publicly traded companies active in the extractive industry or the logging of primary forests. They must report on payments they make to the governments of the countries where they operate (so-called country-by-country reporting<\/em>The aim of this regulation is ambitious: to increase transparency about such payments, to increase pressure on governments of resource-rich countries to disclose the use of resources and the expenditure of those revenues, to reduce corruption and bribery, thereby promoting good governance and political stability in the countries involved, and to obtain more information about investors in this industry.<\/p>\n The reporting covers payments for production rights, taxes, and royalties and is presented in a separate report, separate from the annual accounts and management report. It is, however, published in the same way as the annual accounts through the Chamber of Commerce trade register.<\/p>\n\n\n
\n \u00a0<\/strong><\/td>\n Micro-enterprise<\/strong><\/td>\n Small<\/strong><\/td>\n Medium sized<\/strong><\/td>\n Big<\/strong><\/td>\n<\/tr>\n \n Asset value according to balance sheet<\/strong><\/td>\n \u2264 EUR 350,000<\/td>\n \u2264 EUR 6,000,000<\/td>\n \u2264 EUR 20,000,000<\/td>\n > EUR 20,000,000<\/td>\n<\/tr>\n \n Net sales<\/strong><\/td>\n \u2264 EUR 700,000<\/td>\n \u2264 EUR 12,000,000<\/td>\n \u2264 EUR 40,000,000<\/td>\n > EUR 40,000,000<\/td>\n<\/tr>\n \n Average number of employees<\/strong><\/td>\n < 10<\/td>\n < 50<\/td>\n < 250<\/td>\n > 250<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n \n\n
\n Year:<\/strong><\/td>\n 2<\/strong><\/td>\n 3<\/strong><\/td>\n 4<\/strong><\/td>\n 5<\/strong><\/td>\n 6<\/strong><\/td>\n 7<\/strong><\/td>\n 8<\/strong><\/td>\n 9<\/strong><\/td>\n 10<\/strong><\/td>\n<\/tr>\n \n Company meets the criteria of:<\/strong><\/td>\n Micro<\/td>\n Micro<\/td>\n Small<\/td>\n Resourse<\/td>\n Small<\/td>\n Resourse<\/td>\n Big<\/td>\n Big<\/td>\n Resourse<\/td>\n<\/tr>\n \n Company may apply exemption regime:<\/strong><\/td>\n Micro<\/td>\n Micro<\/td>\n Micro<\/td>\n Small<\/td>\n Small<\/td>\n Small<\/td>\n Resourse<\/td>\n Big<\/td>\n Big<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n \n\n
\n \u00a0<\/strong><\/td>\n Micro-enterprise<\/strong><\/td>\n Small<\/strong><\/td>\n Medium sized<\/strong><\/td>\n Big<\/strong><\/td>\n<\/tr>\n \n Balance<\/strong><\/td>\n Very limited<\/td>\n Limited<\/td>\n Less limited<\/td>\n Unlimited<\/td>\n<\/tr>\n \n Loss and profit<\/strong><\/td>\n Very limited<\/td>\n Limited<\/td>\n Less limited<\/td>\n Unlimited<\/td>\n<\/tr>\n \n Explanation<\/strong><\/td>\n No<\/td>\n Limited<\/td>\n Less Limited<\/td>\n Complete<\/td>\n<\/tr>\n \n Management report<\/strong><\/td>\n No<\/td>\n No<\/td>\n Limited<\/td>\n Complete<\/td>\n<\/tr>\n \n Accountant's statement<\/strong><\/td>\n No<\/td>\n No<\/td>\n Yes<\/td>\n Yes<\/td>\n<\/tr>\n \n Publication<\/strong><\/td>\n Very limited balance<\/td>\n Limited balance<\/p>\n Less limited Balance Sheet, Profit & Loss, Explanation, Management Report, Auditor's Statement<\/td>\n Balance sheet, P&L, Explanation, Management report, Auditor's report<\/p>\n