Home / Company Law and CG / Company Law / Overview of Directives / Seventh Council Directive 83/349/EEC of 13 June 1983 based on Article 54(3)(g) of the Treaty on consolidated accounts

Seventh Council Directive - Consolidated accounts of companies with limited liability (83/349/EEC)

The Directive coordinates national laws on consolidated (i.e. group) accounts. Together with the Fourth Directive on the annual accounts of public limited liability companies, it belongs to the family of "accounting directives" formed by the Community legal acts on company accounts.

This directive defines the circumstances in which consolidated accounts are to be drawn up. Any company (parent company) that legally controls another company (subsidiary company) is under a duty to prepare consolidated accounts. In most cases, legal control takes the form of the holding of a majority of voting rights. Member States may also require consolidated accounts to be prepared in other cases in which a parent company has only a minority shareholding but exercises de facto control. They may provide for exemptions from this obligation.

The Directive sets out the methods of drawing up consolidated accounts. Consolidated accounts comprise the consolidated balance sheet, the consolidated profit and loss account and the notes to the accounts. These documents constitute a composite whole. Consolidated accounts must give a true and fair view of the assets, liabilities, financial position and profit or loss of the companies included therein, taken as a whole. The book values of shares in the capital of companies included in a consolidation must be set off against the proportion which they represent of the capital and reserves of those companies. Such set-off must be effected on the basis of book values as at the date on which the companies are included in the consolidation for the first time.

Legal basis

  • Art. 44 II lit.g EC (former Art. 54 III lit.g EEC)


  • Directive 89/666/EEC
  • Directive 90/604/EEC
  • Directive 90/605/EEC
  • Directive 2001/65/EC
  • Directive 2003/51/EC
  • Proposal COM (2004)725


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