Royal Decree of 5 December 2016 amending the Royal Decrees on the annual accounts of credit institutions, investment firms, and management companies of undertakings for collective investment and of insurance and reinsurance undertakings

FEDERAL PUBLIC SERVICE ECONOMY, SMEs, MIDDLE CLASSES AND ENERGY [C − 2017/20167] 5 DECEMBER 2016. — Royal Decree amending the Royal Decrees on the annual accounts of credit institutions, investment firms and management companies of undertakings for collective investment and of insurance and reinsurance undertakings REPORT TO THE KING Sire, The decree submitted for Your signature aims to introduce various amendments to the Royal Decree of 23 September 1992 on the annual accounts of credit institutions, investment firms and management companies of undertakings for collective investment (hereinafter 'Decree of 23 September 1992') and to the Royal Decree of 17 November 1994 concerning the annual accounts of insurance and reinsurance undertakings (hereinafter 'Decree of 17 November 1994'). The amendments to the aforementioned decrees submitted to You primarily aim to bring these decrees into line with the provisions of Directive 2013/34/EU of the European Parliament and of the Council of 26 June 2013 on the annual financial statements, consolidated financial statements and related reports of certain types of undertakings, amending Directive 2006/43/EC of the European Parliament and of the Council and repealing Directives 78/660/EEC and 83/349/EEC of the Council (hereinafter 'Directive 2013/34/EU'). Furthermore, this opportunity is also used to adapt some provisions of the aforementioned decrees that need to be updated. Updating of the Decrees Various amendments are proposed for the updating of the decrees. In the Decree of 23 September 1992, the reference to the repealed law of 22 March 1993 on the status and supervision of credit institutions was replaced by the reference to the corresponding provision in the law of 25 April 2014 on the status and supervision of credit institutions. In the same way, the reference to the law of 20 July 2004 concerning certain forms of collective management of investment portfolios was replaced by the corresponding provisions of the law of 3 August 2012 concerning undertakings for collective investment that meet the conditions of Directive 2009/65/EC and undertakings for investment in claims and the law of 19 April 2014 concerning alternative undertakings for collective investment and their managers. Furthermore, in this decree, the references to the repealed law of 17 July 1975 relating to the accounting of undertakings were replaced by the corresponding provisions in the Code of Economic Law. The same applies to the references in this decree to the coordinated laws on commercial companies, which were replaced by references to the corresponding provisions of the Companies Code. A translation error in the Dutch text of this decree was also corrected. In the Decrees of 23 September 1992 and 17 November 1994, amendments were subsequently also made to replace outdated concepts with the correct, updated concepts. For example, in both decrees, the concepts of 'pre-pensions' and 'bearer shares' were replaced by the concepts
of 'unemployment with company supplement' and 'dematerialized shares'. Transposition of Directive 2013/34/EU Regarding the transposition of Directive 2013/34/EU, it should first be noted that since its entry into force, this directive forms the basis for European financial reporting law (formerly called annual accounts law). The former Fourth Directive 78/660/EEC of the Council of 25 July 1978 concerning the annual accounts of certain types of companies (hereinafter 'Directive 78/660/EEC') and the Seventh Directive 83/349/EEC of the Council of 13 June 1983 concerning consolidated accounts (hereinafter 'Directive 83/349/EEC'), which formed the basis for European financial reporting law before the entry into force of Directive 2013/34/EU, were repealed by Directive 2013/34/EU. Due to their special nature, the European financial reporting requirements for, on the one hand, credit institutions and other financial institutions, and, on the other hand, insurance undertakings, are supplemented by additional specific European requirements. For credit institutions, these specific requirements are laid down in Directive 86/635/EEC of the Council of 8 December 1986 on the annual accounts and consolidated accounts of banks and other financial institutions. For insurance undertakings, the specific requirements are laid down in Directive 91/674/EEC of the Council of 19 December 1991 on the annual accounts and consolidated accounts of insurance undertakings. These specific requirements always take precedence over the provisions of Directive 2013/34/EU in case of incompatibility or contradiction. This principle is also explicitly included in the seventh recital of Directive 2013/34/EU. The amendments intended to integrate the new financial reporting requirements, included in Directive 2013/34/EU, into Belgian annual accounts law for institutions and undertakings, first relate to the principle of non-offsetting. This principle stipulates that offsetting or netting of assets or liabilities, rights and obligations, and costs and revenues included in the annual accounts is in principle always prohibited. Only when offsetting is expressly permitted can this possibility be used. Article 6, second paragraph, of Directive 2013/34/EU now stipulates that institutions or undertakings that proceed to offsetting or netting in cases where offsetting or netting is expressly permitted, must state the amounts to be offset as gross amounts in the notes to the annual accounts. The decree submitted to you amending the Decrees of 23 September 1992 and 17 November 1994 aims to integrate this new obligation into these decrees. It is subsequently also possible that an asset or liability item, or a cost or revenue, may be included under several items in the balance sheet or in the profit and loss account. In such cases, the asset or liability item, or the cost or revenue, must be included under the item that is most appropriate in light of the principle of a true and fair view. Article
12, first paragraph, of Directive 2013/34/EU now stipulates that in such cases, the relationship with the other items must be stated in the notes. The provisions included in the present decree meet this requirement.
Article 12, twelfth paragraph, of Directive 2013/34/EU clarifies that a provision recognized at the balance sheet date must represent the best estimate of the costs considered probable or, in the case of an obligation, the best estimate of the amount required to fulfill that obligation at the balance sheet date. The present decree makes the same clarification in the Decrees of 23 September 1992 and 17 November 1994.