Details
- Publication date
- 8 March 2022 (Last updated on: 21 December 2023)
- Author
- Directorate-General for Financial Stability, Financial Services and Capital Markets Union
Description
Interaction between EU accounting rules and IFRS reporting
These documents illustrate the interactions between IFRS and non-IFRS financial reporting under EU rules. Please note that these documents are not a definitive interpretation of EU law, which only the European Court of Justice can provide.
- Decision tree on the rules to be applied when preparing financial statements
- Additional EU accounting rules to be applied when preparing IFRS financial statements
Thresholds defining micro, small and medium-sized companies
The accounting directive allows a simplified reporting regime for small and medium-sized enterprises and a very light regime for micro-companies. The thresholds for these categories are periodically updated.
Current thresholds:
| Micro | Small | Medium-sized | |
|---|---|---|---|
| Balance sheet total | ≤ € 450,000 | ≤ € 7,500,000 | ≤ € 25,000,000 |
| Net turnover | ≤ € 900,000 | ≤ € 15,000,000 | ≤ € 50,000,000 |
| Average number of employees during the financial year | ≤ 10 | ≤ 50 | ≤ 250 |
The thresholds for small and medium-sized enterprises were first proposed by the 4th and 7th Council Directives in 1978 and subsequently updated in 1984, 1990, 1994, 1999, 2003 and 2006. The thresholds were modified in 2013, with the adoption of Directive 2013/34/EU repealing the 4th and 7th Directive, then updated by delegated act in 2023.
Other documents
You can find below 2 recommendations and one interpretative communication related to earlier versions of the EU accounting directive. The 2 recommendations are still in force. The first one concerns the definition of micro, small and medium-sized companies, whereas the second one provides guidance to improve the quality, transparency and comparability of environmental data available in companies' annual accounts and reports.
- Commission recommendation 2003/361/EC of 6 May 2003 concerning the definition of micro, small and medium-sized enterprise
- Commission recommendation 2001/453/EC of 30 May 2001 on the recognition, measurement and disclosure of environmental issues in the annual accounts and annual reports of companies
- Interpretative communication of 20 January 1998 concerning certain articles of the fourth and seventh Council Directives on accounting