Audit Your Business in the Netherlands

Those who open companies in the Netherlands have several requirements to comply with. These requirements refer to the pre-registration and post-registration phases of a Dutch company. During the pre-registration phase, a businessperson needs to prepare and file a set of documents with the Trade Register in the Netherlands and register with the tax authorities, while the post-registration phase implies complying with the annual accounting requirements, among which the audit is one of the most important.

Company audits in the Netherlands are based on the Dutch Generally Accepted Accounting Principles (GAAP) which respect both the EU directives and the International Financing Reporting Standards (IFRS).

Below, our Dutch company formation specialists explain the audit requirements imposed on local companies. We also offer company registration and accounting services, among which we also offer audit services in the Netherlands.

What Dutch companies need to have their accounts audited?

There are several types of companies which can be established in the Netherlands, and the following need to have their annual financial accounts audited:

• - the Dutch BV (private limited liability company) and the NV (public company);
• - the cooperative association also needs to file audited financial accounts;
• - the mutual insurance association is another business form which needs to undergo an audit;
• - the general and limited partnership (VOF, respectively CV) which has foreign partnership;
• - the association or foundation which administers the assets of a large business must also be audited.

It is important to notice that the audit regulations for each type of company depends on several aspects which can be explained by our company registration agents in the Netherlands.

Audit regulations in the Netherlands

According to the Dutch GAAP, companies which need to have their accounts audited must hire professionals who are accredited as auditors. Some of the regulations related to appointing auditors are provided for in the Dutch Company Law.

Also, the auditors performing such actions must be independent and registered with the National Institute of Chartered Accountants. Also, companies performing audits in the Netherlands must be licensed by the Financial Markets Authority (AFM).

According to the GAAP, Dutch medium-sized and large companies which fall under two of the following three criteria are required to have their financial accounts audited:

• - their total balance sheet for a year’s period is at least 6 million euros;
• - they have at least 50 employees;
• - their annual revenue is at least 12 million euros.

Any of the criteria mentioned above must be fulfilled for 2 consecutive years in order for a Dutch company to have its account audited.

With years of experience in company formation matters in the Netherlands, our local consultants can guide foreign investors on the audit requirements for their companies.

Accounting documents which need to be audited in a Dutch company

The following documents need to be audited in a Dutch company:

1. the balance sheets and the notes which must be fully disclosed in a large company and condensed in a medium company;
2. the profit and loss account and the notes which must be fully disclosed in a large company and condensed in a medium-sized one;
3. the notes and the principles of valuation which must be fully disclosed no matter the size of the company;
4. the management report which must be fully disclosed for both types of Dutch companies;
5. the cash flow statements which require full disclosure for medium-sized and large businesses.

The accounting documents of a Dutch company must be prepared and approved by the director of the company in a maximum period of 5 months after the end of the financial year. These financial statements must then be reported to the shareholders during the annual general meeting and then filed with the Trade Register in the Netherlands.

It is important to note that the financial statements of a Dutch company must be accurate, relevant to the activities of the company and comparable, according to the GAAP. The main results of an audit should indicate the Dutch company shareholders’ equity, the solvability and the liquidity of the company.

Audit requirements for foreign companies in the Netherlands

In the case of foreign companies operating in the Netherlands, the financial statements must be filed in their home countries, however, copies of these documents must also be submitted with the Dutch Companies Registrar.

The reporting currency in the case of local companies is the euro, while foreign companies can employ their home countries’ currencies.

If you need audit or company formation services in the Netherlands, please contact us.