Net asset value (nettovermogenswaarde)
Net asset value (nettovermogenswaarde) is the value of a participating interest based on the share in its equity, determined under appropriate accounting policies.
What does net asset value mean?
Net asset value (nettovermogenswaarde) is the value of a participating interest based on the share in its equity, determined under appropriate accounting policies.
Under this method the value of the participating interest follows the share in the investee's equity, determined on appropriate policies. The investee's result flows through into the entity's own annual accounts. Negative values call for separate assessment.
How does it work?
A participating interest in which the entity has significant influence over the business and financial policy is valued at net asset value; that influence is presumed with one fifth or more of the voting rights (art. 2:389(1) DCC). The value is determined by valuing the investee's assets, provisions and liabilities, and calculating its result, on the same policies as those of the participating entity (paragraph 2).
The share in the profit increases the participating interest and is income; a dividend received reduces the participating interest and is not income. For the share in profit that the entity cannot have distributed without restrictions, it maintains a statutory reserve for participating interests (paragraph 6). If the first valuation is lower than the purchase price, the difference is goodwill (paragraph 7).
Example
Holding BV buys 40% of Techniek BV on 1 January 2026 for € 100.000. Techniek BV's equity, restated to the holding's policies, is € 200.000. First valuation: 40% × 200.000 = € 80.000; goodwill € 20.000. In 2026 Techniek BV makes € 50.000 profit and pays € 10.000 dividend. Participating interest at the end of 2026: 80.000 + 20.000 − 4.000 = € 96.000. Result from participating interests: € 20.000. Because with 40% the holding cannot force a distribution, it forms a statutory reserve of 20.000 − 4.000 = € 16.000.
In the annual accounts
Financial fixed assets and result from participating interests; possibly a statutory reserve.
Difference from valuation at acquisition cost
At acquisition cost the participating interest stays at the amount paid and only the dividend declared in the financial year is income (RJk B3.126). At net asset value the balance sheet follows the investee's equity and its whole profit counts, including what has not been distributed.
Common mistakes
- Multiplying a subsidiary's book value without adjustment
- Counting dividend as result a second time
What to watch for
- Request the investee's annual accounts and restate deviating policies before applying the percentage.
- If the net asset value is negative, the participating interest is carried at nil under RJ 214; first you write off long-term receivables that are in effect part of the investment (RJk B3.119a); then you form a provision to the extent you stand surety for its debts or are actually obliged to enable it to pay them (RJk B3.119).
- Small entities are exempt from the list of capital interests of art. 2:379 DCC (art. 2:396(5) DCC); micro entities do not show the participating interest separately.
Legal basis and source
art. 2:389 DCC
Frequently asked questions
Must my holding value the operating company at net asset value?
In principle yes: with a 100% interest there is significant influence. The holding's balance sheet then follows the operating company's equity.
Why is dividend received not profit under this method?
Because the investee's profit has already been counted in the year in which it was made. The dividend is merely a shift from the participating interest item to the bank.
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Preparing Dutch annual accounts?
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