Doing Business in Belgium - RSM International

6. Accounting
6.1. Accounting regulations
The rules in Belgium for the bookkeeping, and the preparation and filing of
statutory and consolidated financial statements are ruled by the following laws and
implementing decrees:
• The Companies Code (Law of 7 May 1999), executed by the Royal Decree of
30 January 2001;
• The implementing Royal Decree of 30 January 2001 which co-ordinates accounting
legislation enacted in Belgium since the 1970s;
• Law of 17 July 1975 on enterprise bookkeeping;
• Royal Decree of 12 September 1983 concerning the simplified bookkeeping and
how to hold and keep the enterprise books;
• Royal Decree of 12 September 1983 governing the minimum chart of accounts;
• Royal Decree of 18 January 2005 requiring certain companies to publish their
consolidated financial statements in accordance with IFRS).
This Belgian legal framework (“Belgian GAAP”) is completed by recommendations
and interpretations issued by the Accounting Standards Commissions.
6.2. Accounting standards
It should be noted that Belgian GAAP stipulated separately the requirements
and the recommendations for individuals entities’ financial statements as well
as for consolidated financial statements (part of Royal Decree of 30 January
2001), whereas IAS/IFRS principally applies to consolidated financial statements,
with a few exceptions.
A number of regulatory bodies such as the Banking, Finance and Insurance
Commission enforce financial reporting standards applicable to enterprises under
their supervision, and also issue specific requirements to such enterprises under
their supervision, which include, in addition to listed companies, banks, investment
companies, insurance companies and pension funds.
In Belgium, despite the adoption of IFRS for the consolidated financial statements
of several types of companies, Belgian GAAP remains the required accounting
framework for company financial statements, because of the current impact on tax,
company laws and SMEs (small and medium size entities). The current situation is
indeed as follows for Belgian companies:
• Consolidated financial statements. IFRS as adopted by the European Union are
required as from financial year 2005 for listed companies, as from 2006 for
banks and as from 2007 for those companies that only have bonds listed. Other
companies are allowed since 2004 to early adopt IFRS instead of Belgian GAAP in
their consolidated financial statements (irrevocable choice).
• Company financial statements. Belgian GAAP is still mandatory for company
financial statement (except for listed real-estate investment trusts that must apply
IFRS for company financial statements as from 2007).
The annual accounts comprise the balance sheet, the income statement and the
notes to the accounts. Under Belgian GAAP, elements of the balance sheet or of
the income statement are set out in a standard layout (depending from the size
of the company).
The annual accounts (financial statement) have to satisfy some very
important principles:
No
offset
Consistency
of presentation
Accrual basis and
matching principle
Going concern
True and fair view
In Belgian GAAP, like in other usual GAAP, the annual accounts shall give a true and
fair view of the assets, liabilities, financial position and the results of operations
of an enterprise.
If, in exceptional cases, the application of an accounting policy provided for in
the royal decree to a conflict with the true and fair view principle, this rule shall
be departed from to comply with Royal Decree. The effect of this departure on the
assets, liabilities, financial position and results of operations of the enterprise shall
be disclosed in the notes to the annual accounts for the first financial period in which
this departure occurs.
Each enterprise shall, taking into account the particular nature of its business, define
the rules to be used for the valuation of all assets, liabilities, income and charges
and in particular for establishing and adjusting depreciation/amortisation, writedowns,
provisions for liabilities and charges, and revaluations. These rules shall be
44
DOING BUSINESS IN BELGIUM
DOING BUSINESS IN BELGIUM
45