RJ 110 and 115: basic principles, recognition and separate disclosure

The short answer

RJ 110 sets out the basic principles: true and fair view, going concern, prudence, substance over form and consistency. RJ 115 determines when an asset or liability is recognised on the balance sheet (probable benefit or outflow, reliably measurable), when you show an item separately and when you may offset. For micro and small entities the same is in RJk A1 and A2.1.

Updated 30 October 2026

Key facts

The basic principles of RJ 110

RJ 110 translates the statutory task of art. 2:362 DCC into working rules. Since the 2025 edition, the concepts from the former Stramien (framework), such as relevance, reliability and comparability, are in an introductory paragraph of the volume. The rules you meet in practice:

• Identifiable. The annual accounts state the name of the legal entity, whether they are separate or consolidated accounts, the balance sheet date and period, the currency and the unit, such as thousands of euros (RJ 110.103; for small entities RJk A1.306).
• Different financial year. If the annual accounts cover more or fewer than twelve months, a medium-sized or large legal entity explains why and that the comparative figures are therefore not comparable (RJ 110.104, firm). For small entities this is something they may consider (RJk A1.305).
• Supplementing and departing. If the annual accounts give insufficient view despite the statutory requirements, you supplement; in exceptional cases you depart from a requirement outside section 2 of Title 9, with an explanation in the notes (art. 2:362(4) DCC; RJ 110.106 to 110.109).
• Equity is not business value. Equity is the balance of separately measured items; self-generated goodwill is not put on the balance sheet (RJ 110.111 and 110.115; art. 2:365(1)(d) DCC).
• Consistent. Similar items get the same basis and you keep to that choice; changing goes via RJ 140 (RJ 110.124; RJk A1.308).
• The notes repair nothing. An incorrectly processed item does not become right by explaining it (RJ 110.125; RJk A1.309).
• Comparative figures. Not only for balance sheet and result items, but also in the cash flow statement, the statement of changes in equity and as far as possible for amounts in the notes (RJ 110.127; art. 2:363(5) DCC).
• Judgements and estimates. If these are important and not self-evident, such as whether a lease is a finance lease or how large a claims provision should be, a medium-sized or large legal entity describes them with the assumptions behind them (RJ 110.129).

When an item is recognised on the balance sheet

An asset is a resource controlled by the legal entity, arising from the past and expected to yield economic benefit. A liability is an existing obligation from the past that is expected to lead to an outflow of resources. They are recognised on the balance sheet only when two conditions apply together (RJ 115.104 and 115.105; RJk A2.102 and A2.103):

1. the benefit will probably flow in, or the outflow will probably occur; and
2. the amount can be determined reliably.

If an item does not meet this, it stays off the balance sheet and, where necessary, goes into the notes, as an off-balance-sheet liability or asset (see RJ 252). Executory contracts in which neither party has yet performed, such as a signed lease that has yet to start, you do not recognise, unless the contract has become loss-making for the legal entity (RJ 115.113; RJk A2.104). In the Netherlands you count prepaid costs as assets and amounts received in advance as liabilities (RJ 115.102).

Substance over form

The annual accounts follow the economic reality, not only the legal form (RJ 115.106 to 115.112; RJk A2.108 and A2.108a). In doing so you assess related transactions as a whole. If a transaction changes little on balance in the risks and benefits you realistically bear, the asset stays on the balance sheet and no profit arises; it is then more a financing than a sale. If virtually all risks and benefits pass to another party, the asset leaves the balance sheet and you take the result immediately. If you recognise an asset of which you are not the legal owner, you state this (RJ 115.112).

Separate disclosure or combining

An item need not be stated separately if it is of negligible significance in the whole of the annual accounts for the view required by law. Disclosures required under this title may be omitted to the extent that, taken by themselves and together with similar disclosures, they would be of negligible significance for this view. Disclosures under articles 378, 382 and 383 may not, however, be omitted.

What is "of negligible significance" the RJ fills in with rules of thumb, not hard limits (RJ 115.213 to 115.215; RJk A2.114):

• a balance sheet item larger than 5% of the balance sheet total or 10% of the category to which it belongs, you preferably show separately; below 1% of the balance sheet total it may usually be included in another item;
• a profit and loss item larger than 5% of the gross operating result or 10% of its category, you preferably show separately;
• from financial year 2027 you also weigh the features of the item: nature, function, liquidity, measurement basis, uncertainty, term and restrictions on use (RJ 115.213a; RJk A2.113a).

Disclosures on equity (art. 2:378 DCC), the number of employees (art. 2:382 DCC) and the remuneration of directors and supervisory directors (art. 2:383 DCC) you never omit because of materiality, to the extent they apply to your class. The Decree on annual accounts models (Besluit modellen jaarrekening) applies to the BV and NV, not to the micro entity (art. 1(3) of the decree). Where it is not mandatory, the RJ recommends following it as far as possible (RJ 115.216 from 2027; RJk A2.114a from 2026).

Offsetting and set-off

Assets and liabilities or income and expenses that belong separately you may not strike against each other (art. 2:363(2) DCC). Offsetting on the balance sheet is only allowed if you have an enforceable right to set off both items and settle them simultaneously, and you also firmly intend to do so (RJ 115.305; RJk A2.115). Set-off in the law of property is something else (art. 6:127 DCC): through a set-off declaration or a running current account, receivable and debt legally extinguish, and then only the balance is on the balance sheet.

Case: receivables sold to a factor

Groothandel Lindenhof BV (fictitious, small) sells receivables of € 240.000 to a factoring company on 1 December 2026 for € 232.800. The discount of € 7.200 covers a term of 90 days. Based on experience, Lindenhof expects 1,5% to be uncollectible (€ 3.600) and has formed a provision for it in 2026. In variant A Lindenhof bears every loss through non-payment, in variant B the factor does.

At Groothandel Merwede BV (fictitious, medium-sized, balance sheet total € 18 mln) a deposit of € 300.000 with the landlord is among the other receivables. That is 1,7% of the balance sheet total, but 12,5% of the receivables category (€ 2,4 mln): showing it separately or explaining it in the notes is the obvious course. From 2027 it also counts that the money is tied up until the end of the lease in 2031.

By size class

Common mistakes

• Booking a factoring or sale-and-leaseback arrangement as a sale while the risk stays with the legal entity.
• Offsetting a bank account with a credit balance against an account with a debit balance at another bank.
• Leaving an error on the balance sheet and explaining it in the notes.
• Automatically combining an item under the 5% limit, while by its nature it is important to the reader, such as a loan to a director.

Sources

• Art. 2:362 DCC: true and fair view, fairness and supplementing or departing (wetten.overheid.nl, in Dutch)
• Art. 2:363 DCC: combining, offsetting and comparative figures (wetten.overheid.nl, in Dutch)
• Art. 2:385 DCC: separate measurement (wetten.overheid.nl, in Dutch)
• Decree on annual accounts models (Besluit modellen jaarrekening, wetten.overheid.nl, in Dutch)
• RJ-Uiting 2026-6: amendments following IFRS 18 (rjnet.nl, in Dutch)
• RJ-Uiting 2026-5A: amendments to the RJ volume, including RJ 115.216 (rjnet.nl, in Dutch)

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