Updated - Netherlands implementation of amendments to size thresholds in the Accounting Directive for micro, small, mid-sized and large companies

Overview

The size criteria for micro, small, medium-sized and large undertakings and groups have changed for financial years starting on or after 1 January 2024. In the Netherlands the new size criteria may also be applied for financial years starting on or after 1 January 2023.

The European Commission has reviewed the thresholds of Directive 2013/34/EU (the Accounting Directive) for determining the size category of a company to account for the impact of inflation. Since 2013, these thresholds have remained unchanged. The size criteria are now adjusted by 25% and the adjustments take the form of Commission Delegated Directive (EU) 2023/2775, which was adopted on October 17, 2023, published on December 21, 2023, and entered into force on December 24, 2023.

For medium/large companies, the net turnover threshold has been increased from EUR40million to EUR50m and the balance sheet threshold from EUR20m to EUR25m.

Transposition

The Netherlands implemented this change on March 13, 2024 by means of a Decree. The amended size criteria apply for financial years beginning on or after January 1, 2024. The Netherlands has also given entities the option to apply the amended size criteria for financial years beginning on or after January 1, 2023.

CSRD

This increase in the size criteria will not only reduce the scope of application of the presentation, audit, and publication requirements for financial statements set out in the Accounting Directive. It will also affect the scope of application of the sustainability reporting requirements under the Accounting Directive as amended by the Corporate Sustainability Reporting Directive, – and, consequently, under Article 8 of the Taxonomy Regulation – for large undertakings, small and medium-sized undertakings that are listed, and large groups.

Overboarding and diversity rules

The overboarding and gender diversity target rules for management and supervisory positions at large companies in the Dutch Civil Code are also linked to the size thresholds in the Accounting Directive. The new thresholds may therefore also impact the applicability of these rules for Dutch entities.