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Chapter 30 – Exercises & Cases

Multiple Choice Questions​

  1. Annual accounts in Luxembourg must be filed within: a) 5 months of fiscal year end b) 6 months of fiscal year end c) 7 months of fiscal year end d) 12 months of fiscal year end Answer: c) Annual accounts must be filed within 7 months of fiscal year end.

  2. The three mandatory components of annual accounts are: a) Balance sheet, income statement, cash flow statement b) Balance sheet, income statement, notes c) Income statement, notes, management report d) Balance sheet, notes, audit report Answer: b) The three mandatory components are balance sheet, income statement, and notes.

  3. A small company is defined as one that does not exceed 2 of 3 criteria. The balance sheet threshold is: a) €2,000,000 b) €4,400,000 c) €8,800,000 d) €17,500,000 Answer: b) The balance sheet threshold for small companies is €4,400,000.

  4. An audit is mandatory for companies that exceed: a) 1 of 3 size criteria b) 2 of 3 size criteria c) All 3 size criteria d) None of the above Answer: b) An audit is mandatory for companies exceeding 2 of 3 size criteria.

  5. Documents must be retained for: a) 5 years b) 7 years c) 10 years d) 15 years Answer: c) Documents must be retained for 10 years from end of fiscal year.

  6. The electronic filing platform for annual accounts is: a) RCS portal b) eCDF platform c) FAIA system d) AED portal Answer: b) The electronic filing platform is eCDF (Electronic Corporate Documents Filing).

  7. FAIA format is based on: a) IFRS standards b) LUX GAAP c) OECD SAF-T d) EU directives Answer: c) FAIA format is based on OECD SAF-T (Standard Audit File for Tax).

  8. Which legal form always requires an audit? a) Sàrl b) SNC c) SA d) SCS Answer: c) SA (Société Anonyme) always requires an audit.

  9. Small companies may prepare: a) Only full financial statements b) Only abbreviated financial statements c) Either abbreviated or full financial statements d) No financial statements required Answer: c) Small companies may prepare either abbreviated or full financial statements.

  10. The principle requiring financial statements to accurately represent company's financial position is: a) Materiality b) True and fair view c) Going concern d) Consistency Answer: b) The principle is "true and fair view" (image fidèle).

Questions​

  1. Explain the legal framework governing financial reporting in Luxembourg. What are the primary legal sources?

  2. What are the three mandatory components of annual accounts? How do they relate to each other?

  3. What is the filing deadline for annual accounts? How is it calculated?

  4. Explain the RCS filing requirements. What information becomes publicly accessible?

  5. What is the eCDF platform? What are its key features and requirements?

  6. What is FAIA? When is it required and what format does it use?

  7. What are the document retention requirements in Luxembourg? What documents must be retained?

  8. When is a statutory audit mandatory? What are the size thresholds?

  9. What is the difference between abbreviated and full financial statements? When can each be used?

  10. Explain the company size classifications. How do they affect reporting requirements?

Note: Complete solutions are available in the solutions manual.

End of Chapter 30 Exercises