Everyone knows the criteria for determining whether or not a company is 'large' and therefore, in principle, must appoint a statutory auditor. But what if a company is part of a group that must or must not consolidate? And what if the company is part of an international group?
What follows is a short summary.
A company is considered to be large and must therefore appoint a statutory auditor if more than one of the following three criteria is exceeded:
If more than one of these three criteria is exceeded or no longer exceeded, this only has consequences if this occurs in two consecutive financial years. The consequences will then take effect from the following financial year. Suppose: a company exceeds more than one of the three criteria for the financial years 2019 and 2020, then it will be considered large as from the financial year 2021 and must appoint a statutory auditor.
When a company is part of a group of companies that are obliged to consolidate, a statutory auditor must be appointed even if the company concerned is considered small in itself. In Belgium, the consolidation obligation exists for any company that alone or jointly controls one or more subsidiaries or forms a consortium, except:
A group of ‘’limited’ size is then a group that on a consolidated basis does not exceed more than one of the following criteria:
These criteria must be verified on the closing date of the consolidating company's financial year. If more than one of these three criteria is exceeded or no longer exceeded, this only has consequences if this occurs in two consecutive financial years. The consequences will then take effect from the following financial year.
Also when a company is part of an international group of companies that is obliged to consolidate, a statutory auditor must be appointed. In this regard, consideration should be given to the rules on consolidation obligations that apply abroad, which may be stricter than the Belgian ones, so that, the case being, consolidation must be carried out more quickly there than in Belgium.
It is therefore possible that a small Belgian company has to appoint a statutory auditor because of a consolidation obligation abroad.
If a statutory auditor is not appointed, the following sanctions may be imposed:
In particular, companies that are part of an international group must ensure that they are aware of the consolidation rules abroad.