Management board report

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Together with the financial statements the management board report should be prepared and this should contain the following information about the company:

financial position;
developments and performance during the period;
activities in research and development;
objectives and policy of risk management;
expectations about future business;
events after the balance sheet.

Small companies are exempted from preparing a management board report. Large companies have to set up a separate executive board and the supervisory board after 3 years when certain conditions are met (two-tier system). It is expected that in the near future a one-tier system will also be allowed.

Some consequences for each category

Small entity	Medium sized	Large entity
No consolidation required	Consolidation required	Consolidation required
No statutory audit required	Statutory audit required	Statutory audit required
Filing of abbreviated balance sheet only (no P&L) and short notes	Filing of full set of financial statements with some exemptions	Filing of full set of financial statements

Dutch companies are allowed to prepare their financial statements according to either Dutch Generally Accepted Accounting Principles (‘Dutch GAAP’), certain European Generally Accepted Accounting Principles or International Financial Reporting standards (‘IFRs’). Listed companies are required to prepare and file consolidated financial statements in accordance with IFRs.

The financial statements can be prepared in Dutch, English, French or German.

In general a workers’ council is required if the company employees more than 50 people. The workers’ council has mainly an advisory function..

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