New Dutch legislationNov 09, 2015
There is a new Dutch Legislation on the filing of annual accounts that was passed recently introduced. The Bill, passed by the Dutch Parliament last September 30, 2015, would mean the EU directive 2013/34/EU on annual financial statements and related reports shall apply to all corporate entities that are governed by and in accordance with the Dutch law.
The principal objective of this Accounting Directive is to simplify, if not modernize, the accounting law specifically the reportorial requirements of registered companies. The Bill in general will serve to cut administrative costs of businesses in the small and medium-sized categories. There will be improved transparency in the payments for public transactions.
This Bill was made known thru a publication under the name Accounting Directive Implementation Act will take effect on November 1, 2015 and applicable to financial years beginning on January 1st of 2016. These new rules may possibly be applied to financial years prior to January 2016 in case where a company has been re-classified and has met the new criteria. A number of companies may derive benefit from the exemptions offered under the new set-up.
The size of a company shall be determined based total asset value and be qualified based on the new increased limits. A new classification, the micro-sized company, has been introduced as an optional category to which most exemptions are likely to apply.
In summary, there are two major changes promulgated under this new Bill.
The new company size and classification brackets are the following:
Total Asset Value: ≤ ₤ 350,000 < ₤ 6million < ₤ 20million > ₤20million
Net Turnover: ≤ ₤ 700,000 < ₤ 12million < ₤ 40million > ₤ 40million
No. of Employees: <10 < 50 <250 ≥ 250
For a company to qualify into a classification, they should meet two to three of the criteria set forth above on two consecutive financial years or balance sheet dates.
Once the new and higher limits are applied, the rules limiting the number of directorships and memberships of supervisory boards of large companies will also be affected. The companies that previously qualified as large companies but are re-classified as medium-sized would not be covered by such limitation rules.
The second mahor change is the term of filing the annual accounts. Where the deadline used to be 13 months after the end of the financial year, it has been reduced to 12 months. Companies are reminded to be mindful of this shorter deadline as failure or non-compliance is an economic offense which carries corresponding penalties.