Large and small enterprises
The Accounting Act defines what are considered to be large and small enterprises. Stricter requirements are imposed on large enterprises. For example, small enterprises are subject to simplified requirements concerning notes and are not required to prepare a cash flow analysis either. A separate standard has been prepared for small enterprises (NRS 8).
According to the Accounting Act, public limited companies (ASA) and listed enterprises are always considered to be large enterprises. Others businesses which are required to prepare accounts can also be considered to be large enterprises under special provisions.
This category covers enterprises subject to the obligation to prepare accounts which are not considered to be large and which fulfil at least two of the following three requirements over two consecutive years:
- Sales revenues less than NOK 70 million
- Balance sheet total (+sum of balance sheet assets) less than NOK 35 million
- Fewer than 50 employees determined as average full-time equivalents during the financial year
It is the value at the end of the financial year (normally 31 December) which is to be used as a basis, but you must be over the threshold for two consecutive years in order for the definition of your company to change. For example, an enterprise which expands must be above the limit for two consecutive years. The status will change from the second year inclusive. The same applies to enterprises which downsize.
In the case of newly founded enterprises, the circumstances at the end of the first financial year must be used as a basis.
The parent group of a group of companies will only be considered to be small if the group collectively fulfils the conditions.
Enterprises not covered by the definition of large or small enterprises are called "other enterprises".