Balans

The balance sheet constitutes a crucial component of the annual accounts and provides a snapshot of the financial position of a legal entity. By setting off assets against liabilities, the balance sheet indicates whether equity is positive or negative.

Under Dutch corporate law, the preparation and filing of a balance sheet is mandatory for most companies pursuant to Book 2 of the Dutch Civil Code and the Guidelines for Annual Reporting. This ensures transparency vis-à-vis shareholders, creditors and the Tax Authority.

In practice, the balance sheet is frequently used in due diligence investigations, financing applications and bankruptcy proceedings to assess the solvency and liquidity of an enterprise.