An Overview of Accounting and Auditing in France
Accounting and Auditing in France is stressful as it is subject to rigid laws that are not open to mistakes and carry high penalties. France is a member of the European Union (EU) and is subject to the accounting, auditing, and financial reporting requirements established in EU Regulations and Directives. The EU Regulations and Directives are transposed into national laws and regulations. In France, the Commercial Code of 1966 sets the essential accounting functions for all business entities and requires companies to maintain accounting books and prepare annual financial statements. A mandatory audit with a term of six years is required for all PIEs and public limited companies if the following thresholds are exceeded:
- EUR 4,000,000 of the total assets;
- EUR 8,000,000 of the turnover or resources; and
- 50 employees.
The French accounting standards are based on Generally Accepted Accounting Principles (GAAP). However, the consolidated financial statements are required to be prepared as per the International Financial Reporting Standards (IFRS). As France is a member of the EU, French law is based on the European Commission (EC) Regulation No. 1606/2002. The French Accounting Standard Authority is the Autorité des Normes Comptables (ANC).
All public limited companies must publish annual financial statements and deposit two copies of the approved balance sheets and Profit and Loss statement with the local commercial court within seven months from the end of the financial year and one month from the approval of the accounts. A listed public limited company should publish its annual balance sheet, Profit and Loss statement, quarterly sales figure for each branch of activity and semi-annual provisional balance sheet. Further, the subsidiaries of these companies having a balance sheet of EUR 3 million or more or portfolios worth Euro 300,000 or more are subject to disclosure requirements individually. For large companies, the statement of source and application of funds is compulsory.
In France, there are three levels of reporting requirements:
- The basic system
- An abridged system for small companies
- A Developed system
The type of reporting requirement one must opt for depends upon the legal form and size of the companies. The company's size depends upon the total balance sheet, turnover and the number of employees.
Time Period for Reporting
The time period for reporting is annually. However, for listed companies, the reporting period is quarterly.
Regulating the Accounting Profession
In France, the accounting profession is regulated at two levels: the state level and the professional level. As per the Commercial Code, the High Council for Statutory Audits (H3C), the Ministry of Justice oversees the audit profession.
Services offered by Enterslice
- Enterslice assists in classifying, recording, interpreting and summarizing the financial data and determines the actual financial position of the organization.
- Enterslice assists in determining the profit and loss and the client's financial position.
- Enterslice provides bookkeeping services to its clients. We help maintain the records by recording the transactions daily.
- Enterslice records all the transactions and analyzes the financial implication of the transactions.
- Enterslice captures all details pertaining to financial records and transactions of the client organization.
- Enterslice ensures that the accounting standards and the auditing standards are followed.
- Enterslice assists in preparing financial statements such as income statements, profit and loss accounts, balance sheets, cash flow statements, etc.
- Enterslice assists in the process of examining the financial statements and records of our clients.
- Enterslice investigates any discrepancies that arise during the process of recording transactions and also helpsverify the records' accuracy.
- Enterslice assists in ascertaining the correctness and accuracy of the recorded transactions.
- Enterslice ensures that the auditing is conducted monthly, quarterly or yearly.
- Enterslice helps maintain up-to-date records of accounting and auditing.
- Enterslice advises on the areas of underperformance and the corrective measures to be undertaken.
- Enterslice assists in ensuring the accuracy of the company’s financial records.
- Enterslice advises its clients on the best accounting practices and assists you in fulfilling their accounting records and financial reporting needs.