Luxembourg CNC Q&A 26/037: key reminders about statutory vs contractual or voluntary annual accounts

The Q&A primarily concerns limited liability companies and similar entities as referred to in the EU Accounting Directive (2013/34/EU), being SA, SCA, SARL and, where applicable, SNC and SCS. Special limited partnerships (SCSp) are excluded.

The Q&A sets out the following key principles:

1. Concept of statutory annual accounts. Statutory annual accounts are the annual accounts that a company is required to prepare under Luxembourg law, which are aimed at informing and protecting shareholders, third-party creditors and the general public. They are subject to approval by the general meeting of shareholders or partners, they form the basis for the appropriation of profits, the creation of reserves, the determination of distributable reserves and the maintenance of capital, and they are filed with the RCS and published in the RESA.
2. Only approved annual accounts can be filed with the RCS. Article 75(1) of the RCS Law requires that annual accounts filed with the RCS be duly approved by the general meeting of shareholders or partners. Therefore, a company cannot file a separate, unapproved set of accounts with the RCS alongside a set of duly approved accounts.
   
3. Contractual or voluntary accounts may be shared with the public. Where contractual or voluntary accounts are shared with a wider public, the CNC recommends including a disclosure in the notes to the accounts setting out their contractual/voluntary nature and the existence of statutory accounts filed with the RCS in order to avoid any confusion with the statutory annual accounts.
   
4. Three accounting frameworks allowed for statutory accounts and free choice for contractual accounts. Statutory accounts must be prepared under LUX GAAP, LUX GAAP- FV or IFRS as endorsed in the EU, while contractual and voluntary accounts may be prepared under any accounting framework chosen by the company.
   
5. Approval of detailed accounts is permitted alongside the filing of abridged accounts. Provided both sets of accounts are prepared in accordance with the same accounting framework and present the same accounting aggregates, companies may submit more detailed accounts to their shareholders or partners while filing an abridged version with the RCS.