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 17 October 2023, published on 21 December 2023, and entered into force on 24 December 2023.
For medium/large companies, the net turnover threshold is increased from €40 million to €50 million and the balance sheet threshold from €20 million to €25 million.
Transposition
The Netherlands has implemented this change on 13 March 2024 by means of a Decree. The amended size criteria apply for financial years beginning on or after 1 January 2024. The Netherlands has also given entities the option to apply the amended size criteria for financial years beginning on or after 1 January 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.
