What are annual accounts in France and what do they consist of?

French companies are required to prepare and file a set of financial statements (the annual accounts) once a year.

Content of the annual accounts in France:

✅ the balance sheet (le bilan);

✅ the income statement (le compte de résultat);

✅ the notes to the annual accounts also known as the appendix (l’annexe).

Therefore, the statement of cash flow and the statement of changes in equity are not part of the French annual accounts. However, some companies may be required to include a statement of changes in equity in the appendix depending on the presentation format they are subject to, as we will see below.

Three formats are available for preparing the annual accounts in France:

  • The basic presentation
  • The simplified presentation
  • The developed presentation

The size of the company will determine which format it should use for presenting the annual accounts.

The basic presentation of the annual accounts

Companies are required to present their annual accounts using the basic template when 2 of the following criteria are met:

1. Total balance sheet exceeds €6,000,000;
2. Total turnover exceeds €12,000,000;
3. The headcount exceeds 50 employees.

The simplified presention of the annual accounts

Companies which meet at least 2 of the following criteria can present a simplified version of their balance sheet and income statement:

1. Total balance sheet does not exceed €1,000,000;
2. Total turnover does not exceed €2,000,000;
3. The headcount does not exceed 20 employees.

Also, French medium-sized companies can present a simplified version of their income statement when at least 2 of the following criteria are met:

1. Total balance sheet does not exceed €20,000,000;
2. Total turnover does not exceed €40,000,000;
3. The headcount does not exceed 250 employees.

As for the appendix, 3 possible situations exist within the simplified presentation of the annual accounts.

a) Very small entities can decide not to present the appendix altogether. For this purpose, a very small entity meets 2 of the following criteria:

1. Total balance sheet does not exceed €350,000;
2. Total turnover does not exceed €700,000;
3. The headcount does not exceed 10 employees.

b) Companies which meets 2 of the following criteria can decide to present an abbreviated version of the appendix:

1. Total balance sheet does not exceed €6,000,000;
2. Total turnover does not exceed €818,000 for trading activities or €247,000 for service providers;
3. The headcount does not exceed 50 employees.

c) Companies which meet 2 of the following criteria can decide to present a simplified version of the appendix:

1. Total balance sheet exceeds €6,000,000;
2. Total turnover exceeds €12,000,000;
3. The headcount exceeds 50 employees.

 

The developed presentation of the annual accounts

As long as companies present their annual accounts using as a minimum the format appropriate to their size, they can still add additional information and disclosures voluntarily if they think that this would give more useful information to the shareholders and end-users.

Annual accounts filing deadline in France

When are the financial statements or the annual accounts due in France?

Management or any authorised third-party must file the annual accounts within the month following the date of the Annual General Meeting (AGM) signing off the annual accounts, or otherwise within two months after the date of the AGM if the accounts are filed electronically.

Management must convene the AGM of shareholders within six months after the end of the accounting period (financial year).

Therefore, for an accounting period ending on 31.12.2023, the AGM signing off the annual accounts must be held on 30.06.2024 at the latest. The annual accounts must then be filed with the registrar of the Commercial Court by 31.07.2024 at the latest or otherwise by 31.08.2024 if the accounts are filed electronically.

Filing your company’s annual accounts electronically on the INPI website

 

What are the other documents required for filing the accounts in France?

A set of documents must be attached to the annual accounts for the purpose of filing.

A company may be exempted from presenting some of these documents depending on its size, structure or activity.

These documents are:

  • The annual management report (le rapport annuel de gestion);
  • The report of the Board of Directors (if applicable),
  • The auditor’s reports (if applicable);
  • The confidentiality declaration (if applicable);
  • The AGM minutes including the proposal and the resolution of the apportion of the accounting profit.

Audit requirements in France

Are audits of annual accounts required in France?

The requirements for appointing a statutory auditor in France are aligned with the provisions of the European Union directives.

Public interest entities (PIEs)

The appointment of a statutory auditor is compulsory by default for PIEs.

PIEs include:

  • Companies with marketable securities listed on EU regulated markets;
  • Banks and Credit institutions authorised;
  • Insurance companies.

Thresholds for appointing an auditor in a single entity

A single entity is not controlled by another entity and itself does not control another entity.

A single entity must appoint a statutory auditor if 2 of the following criteria are met:

1. Total balance sheet exceeds €4,000,000;
2. Total turnover exceeds €8,000,000;
3. The headcount exceeds 50 employees.

Thresholds for appointing an auditor in the parent company of a small group

The parent company of a small group must appoint an auditor if the group including the parent entity and the companies it controls meets 2 of the following criteria:

1. Total balance sheet exceeds €4,000,000;
2. Total turnover exceeds €8,000,000;
3. The headcount exceeds 50 employees.

 

Thresholds for appointing an auditor in an entity controlled by the parent company of a small group

An entity within a small group as defined above and which is not the parent company must appoint an auditor if 2 of the followings are met:

1. Total balance sheet exceeds €2,000,000;
2. Total turnover exceeds €4,000,000;
3. The headcount exceeds 25 employees. 

Looking for an accountant for preparing your company's annual accounts in France?

GAAPWise Accounting & Advisory Services is an English-speaking firm of chartered accountants in Paris, France.

We specialise in providing first-class accounting and tax compliance services to foreign investors, small business owners and French subsidiaries of international businesses.

Our team consists of professionals who have been trained in France, the UK and the US.

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