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Accounting law reforms (2013)

Published on by LPG

ACCOUNTING LAW REFORMS (2013)

 

Luxembourg accounting law has evolved with new modifications introduced by the law of July 31, 2013. Reforms included changes to the Commission on Accounting Norms, various modifications related to corporate accounting and financial statements as well as consolidated accounts on certain types of companies.


This new law enacts a number of modifications to accounting law, including :

 

  • Modifications on the Commission of Accounting Norms (Luxembourg CNC)

The form and the function of the CNC have been modified in that the CNC is henceforth organized under the form of an Economic Interest Grouping (EIG). It is authorized to levy an administrative tax on financial statements (amount between 5 and 10 EUR) for operating expenses.

 

  • Modifications on the possibility of evaluating assets at their fair value

The only assets that can be evaluated at their fair value are those under which the IFRS norms permit their evaluation at the fair value (for example investment property).

Additionally, companies which evaluate their assets at fair value must limit the distribution of dividends only to realized profits to associates or shareholders (as opposed to profits from the revaluation of assets at fair value).

 

  • Modifications in the implementation of the important accounting principles

Implementation of the principle of substance over form is optional after these reforms.

 

  • Modifications in the format of financial statements

Implementation of new formats for SPF financial statements (private wealth management companies) is optional after these reforms. SPF must also register their operations through the Standard Chart of Accounts.


The model for balance sheets and the profit and loss accounts has changed slightly along with the minimum content of the notes and includes supplementary information (particularly in the case where the assets are assessed at fair value).


The full modifications can be found in "Précis de Droit Comptable, édition 2014" by Denis Colin by éditions Legitech (available in French).