Richtlijn 1983/349 - Zevende Richtlijn 83/349/EEG op de grondslag van artikel 54, lid 3, sub g) van het Verdrag betreffende de geconsolideerde jaarrekening

Seventh Directive: consolidated accounts of companies with limited liability

This Seventh Company Law Directive coordinates national laws on consolidated (i.e. group) accounts. Together with the Fourth Directive on the annual accounts of public limited liability companies, it belongs to the family of "accounting directives" that form the arsenal of Community legal acts governing company accounts.

ACT

Seventh Council Directive 83/349/EEC of 13 June 1983 based on Article 54(3)(g) of the Treaty on consolidated accounts [See amending acts].

SUMMARY

The following text concerns a consolidation of existing Directives on consolidated accounts of companies with limited liability.

A parent company and all its subsidiaries are companies to be consolidated where either the parent company or one or more subsidiaries is established as a company with limited liability if the parent company exercises a dominant influence over the subsidiary.

These Directives define the circumstances in which consolidated accounts are to be drawn up. Any company (parent company) which legally controls another company (subsidiary company) is under a duty to prepare consolidated accounts. In most cases, legal control takes the form of the holding of a majority of voting rights. Member States may also require consolidated accounts to be prepared in other cases where a parent company has only a minority shareholding but exercises de facto control. They may provide for exemption from this obligation. The figures given in euro in Directive 78/660/EEC serve as thresholds for defining the groups which can be exempted completely from the consolidated accounts requirement.

The Directive sets out the methods of drawing up consolidated accounts:

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  Consolidated accounts comprise the consolidated balance sheet, the consolidated profit and loss account and the notes to the accounts. Consolidated accounts must give a true and fair view of the assets, liabilities, financial position and profit or loss of the companies included therein taken as a whole.
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  The book values of shares in the capital of companies included in a consolidation must be set off against the proportion which they represent of the capital and reserves of those companies. Such set-off must be effected on the basis of book values as at the date on which the companies are included in the consolidation for the first time.
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  The consolidated accounts must be drawn up on the same date and by the same methods as the annual accounts of the parent company.

The Annex states that certain information must be provided in the notes, on such things as valuation methods, the names and the registered offices of the undertakings included in the consolidation, total of certain types of debts, etc.

The Directives also regulate the contents of the consolidated annual report. This must include at least a fair review of the development of business and the position of the undertakings included in the consolidation taken as a whole, and certain indications for each of those undertakings (number and nominal value of shares, etc.).

The Directives establish a system of auditing under which a company which prepares consolidated accounts must have them audited by one or more persons authorised to audit accounts under the laws of the Member State which govern that company. The person or persons responsible for auditing the consolidated accounts must also verify that the consolidated annual report is consistent with the consolidated accounts for the same financial year.

Context

The Directives lay down rules on disclosure. The consolidated accounts, the consolidated annual report and the auditor's report must be published in accordance with the provisions of the first Directive.

References

The successive amendments and corrigenda to Directive 83/349/ECC been incorporated into the original text. This consolidated version is of mere documentary value.

Last updated: 02.12.2009

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