Corporate groups

Consolidated financial statements in France: legal requirements

Once a company controls one or more other undertakings, it must in principle prepare consolidated financial statements showing the economic position of the group, unless it qualifies for one of the exemptions in the French Commercial Code (Code de commerce).

Who has to prepare consolidated financial statements?

Article L.233-16 of the Commercial Code requires commercial companies that exclusively or jointly control one or more other undertakings to prepare and publish consolidated financial statements each year, together with a group management report. Exclusive control arises from directly or indirectly holding the majority of voting rights, from the power to appoint the majority of the management bodies for two successive financial years, or from a dominant influence under a contract or provisions of the articles of association (statuts). Joint control means that control of a jointly operated undertaking is shared among a limited number of shareholders.

The exemption for groups that are not large groups

Article L.233-17 of the Commercial Code exempts from the obligation to prepare consolidated financial statements companies and their subsidiaries that do not form a large group, meaning those that do not exceed two of the three thresholds set by article D.230-2 of the Commercial Code: a balance sheet total of 30 million euros, net turnover of 60 million euros and an average of 250 employees. These thresholds, set by decree no. 2024-152 of 28 February 2024, have applied since the new wording of article L.233-17 introduced by ordinance no. 2023-1142 of 6 December 2023 came into force on 1 January 2025, that is, to financial years ending on or after that date. Financial years ending before that date remained subject to the previous thresholds of 24 million euros for the balance sheet total and 48 million euros for turnover.

As with other company law thresholds, crossing them is assessed over two consecutive financial years: a group that exceeds two of the three thresholds in one year only remains exempt, and becomes required to consolidate only after exceeding these thresholds for two successive financial years.

Groups excluded from this exemption

Whatever their size, some groups cannot rely on the small-group exemption where one of their companies falls within the categories listed in article L.123-16-2, which include companies whose securities are admitted to trading on a regulated market, credit institutions, insurance undertakings, or entities engaged in public fundraising. A single such company within the scope is enough to rule out the exemption for the whole group.

The sub-group exemption

A company can also be released from preparing its own consolidated financial statements where it is itself controlled by an undertaking that includes it in its consolidated financial statements, subject to the conditions laid down in article L.233-17 (in particular, no objection from minority shareholders holding a significant share of the capital). This sub-group exemption avoids several layers of consolidation within the same group.

The audit by the statutory auditor

Consolidated financial statements are audited by the statutory auditor or auditors (commissaires aux comptes) of the consolidating company, who give an opinion on their regularity and fairness and on the true and fair view they give of the assets and liabilities, financial position and results of the undertakings included in the consolidation, under the second paragraph of article L.821-53. Where the preparation of consolidated financial statements is a legal requirement, the consolidating company must appoint at least two statutory auditors. This joint audit (co-commissariat) is intended to make the audit more reliable on a scope that is by nature more complex than a single company. Where consolidation is purely voluntary, the joint audit requirement does not apply and a single statutory auditor is enough.

Our approach at audit france

audit france audits consolidated financial statements, alone or as joint auditor, with a methodology adapted to the group's structure: defining the scope of consolidation, reviewing consolidation adjustments, coordinating with the subsidiaries' statutory auditors. The signing partner remains the single point of contact throughout the engagement.

Why choose audit france

A 100% digital firm dedicated solely to statutory audit, registered with the Haute Autorité de l'Audit (H2A) and a member of the Compagnie Nationale des Commissaires aux Comptes (CNCC) and working across mainland France and the French overseas territories.

This page is a practical guide in English, for information only. It is not legal advice, and only the French texts have legal force. Check the version in force for your own situation.