12 Aug The annual accounts
Many companies are familiar with the filing of annual accounts. For many it is mandatory and for good reason. Publication of the figures ensures that business relations know how they are doing. But where can you consult annual accounts? And why? You can find more information on this in the article below.
Who is obliged to file the annual accounts?
As most people know, it is not mandatory for natural persons (self-employed, one-man business) with a professional activity to publish their annual accounts. However, for those who exercise a professional activity under one of the following company forms, filing the annual accounts is an obligation: public limited company (NV), limited partnership (on shares) (Comm.V and Comm.VA), private company (with limited liability) (BV and BVBA), cooperative company (limited liability) (CV and CVBA), economic interest grouping (EIG), European economic interest grouping (EEIG) registered in Belgium and the European company (SE) under Belgian law.
This will also be the case for the general partnership (VOF), the (ordinary) limited partnership (CommV) and the cooperative company with unlimited liability (CVOA) if they have one or more legal persons among their unlimited liable partners and at the same time are considered big companies.
Since January 2020, there Belgium has six models for companies:
- For companies with share capital: full model, condensed model, micro model
- For companies without share capital: full model, shortened model, micro model
In addition, there are other existing models for other legal forms (associations and foundations) or activities (banks and insurance).
These can be found on the website of the National Bank of Belgium. Based on the models and the new legislation, we make the necessary adjustments to the financial heading and ratios in our database and online tools. This way, we provide the current information that is needed to perform a financial analysis as correctly and completely as possible.
Why consult annual accounts?
Financial statements are consulted to carry out financial analyses and map out the financial situation of a company. Whether a company is financially healthy is usually determined on the basis of the following 4 criteria (ratios):
- Profitability: is there sufficient profit (potential)?
- Liquidity: can the payment obligation be fulfilled in the short term?
- Solvency: can the long-term payment obligation be met?
- Added value: difference between production and consumption.
These 4 criteria can of course not be read from the annual accounts, they have to be calculated using a formula. All the information you need to calculate the formula can be found in the annual accounts.
The scheme below shows when a company is financially healthy, taking into account the profitability and liquidity of that company.
Consulting the annual accounts of existing or new business relations is a good way to check whether the cooperation can run smoothly. Based on the figures and the criteria mentioned above, it is easier to make an informed decision when it comes to establishing or maintaining a business relation.
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Where can you consult the annual accounts?
The annual accounts are filed online and published by the National Bank of Belgium and can be found under their section ” Central Balance Sheet Office”.
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