Check the financial position of your business partner

Are you signing a contract with a new business partner? Then make sure you know the state of their company's finances. To ensure you can do business securely, it is sensible to check the annual accounts or balance sheet. Read how to do that.

Many companies must submit their financial statements to KVK every year.. This is called filing. These annual accounts contain information about a company's financial affairs. For small companies, this usually consists only of a balance sheet. Larger companies have to provide more information. 

Looking at this information helps you judge whether companies are good business partners for you. Are their money matters in order? Then it is more likely that your invoice will be paid on time, or your order delivered. You can request a company's annual accounts online.  Note: sole traders do not have to submit financial information.

Small business: limited balance sheet

Small companies (up to 50 employees and up to €15 million net turnover) submit a limited balance sheet and an explanation of how it was prepared to KVK annually. Here you will find information on assets, liabilities, and equity. But it does not tell you what, for example, someone's company stock is worth at that moment.

There is also a way to get a better financial picture even of smaller companies. By comparing several financial years, you can see how a company has developed financially in recent years.

Large companies: detailed information

Large companies (with more than 50 employees and more than €15 million net turnover) submit detailed financial information to the KVK every year. The larger the company, the more information there is in a financial statement. For example, an annual report or management report, a profit and loss account and an auditor's report. The company must also explain these financial statements so that you can understand them better. Dutch companies that sell their shares through the stock exchange do not file with KVK. They must file their financial report with the Financial Markets Authority (AFM) within 4 months of the financial year ending.

Profit and loss account

‘Are you making money with your business?’ The profit and loss account gives a clear answer to that question. In it, you read about turnover, costs, and profit. Take a good look at the profit and loss account. You may see notable outliers or surprises. Also compare the accounts with those of previous years. Are there any big differences? Do you see clear growth or decline? This is how you assess, for example, whether your business partner will be able to honour your agreements later.

Can my business partner pay?

If a company can easily pay off all its current debts, it is called a ‘healthy’ company. You determine this with the help of figures from the financial statements. There is a quick way to check whether your business partner is healthy. Add up the ‘current assets’ and ‘cash and cash equivalents’. Divide that number by the ‘current liabilities’. Does this result in a number higher than 1.5? Then the company is healthy. If the result is below 1, it is not.

Explanation: current assets are the assets that the company can convert into cash within around 1 year. Cash and cash equivalents consist of all the money present in the company (sum of all business bank accounts, credit card accounts, and available money in cash). Short-term debt is debt with a maturity of up to 1 year.


KVK checks whether a filed financial statement consists of the correct components. KVK does not check the content itself. This is the responsibility of the entrepreneur. So, you only have the information the company gives about itself. Larger companies must have their annual accounts checked by an auditor.

No annual accounts?

Filing financial information is mandatory for many companies. Yet there are companies that fail to do so on time, or at all. This may be due to illness, a business takeover, or delays with the accountant, for instance. But if you see this happening with your business partner several years in a row, it could mean they may also be careless about other financial matters.