When a company is formed or its capital is increased through a contribution in kind, the value of the contributions must be assessed by an independent expert who understands the specifics of such operations, like Houdart Audit & Conseil, to ensure fairness among partners.
The mission of the contributions auditor is governed by standards that define both the nature of the procedures to be implemented, the format of the report to be issued, and the deadlines to be met.
It should be noted that the mission of a contribution auditor inherently involves a strict incompatibility with the role of a statutory auditor. We cannot be appointed as the contribution auditor for a company for which we are the statutory auditor.
The mission of the contributions auditor
The mission of the contributions auditor is governed by standards that define both the nature of the procedures to be implemented, the format of the report to be issued, and the deadlines to be met.
As a contributions auditor, the main tasks involve assessing:
- The value of the assets contributed at the time of incorporation or a capital increase, ensuring under his responsibility that the value is not overestimated and corresponds at least to the nominal value of the shares or interests to be issued,
- Any special benefits that may be stipulated during these operations.
The auditor then prepares a report indicating his assessment of the determined value of the contributions and any granted special benefits, which are filed with the Trade and Companies Register as part of the formalities, or appended to the articles of incorporation.
If the shareholders choose to disregard the auditor’s valuation assessment during the formation of the company or the capital increase, they are jointly liable for five years to third parties for the value attributed to the contributions.
Appointment of a contributions auditor
Designation of a contributions auditor when establishing a Company
The appointment of the contributions auditor is made unanimously by the partners or shareholders. In the absence of a unanimous agreement, the appointment of the contributions auditor is made by a request submitted by the legal representative of the company to the President of the Commercial Court, who will decide by order. The applicant may suggest the name of a contribution auditor to the President of the Commercial Court, subject to his discretion.
Exception for the SARL
- To simplify the process of creating an SARL, the Commercial Code provides an exemption from the obligation to appoint a contribution auditor. Thus, the partners can unanimously decide that the use of a contribution auditor will not be mandatory when the following two conditions are met simultaneously:
- The value of each contribution in kind is less than 30,000 euros
- The total value of all contributions in kind does not exceed half of the share capital.
The partners then assume joint responsibility for the value attributed to the contributions in kind for five years, with respect to third parties.
Designation of a contributions auditor in the context of a capital increase
The appointment of the contributions auditor is made unanimously by the partners or shareholders. In the absence of a unanimous agreement, the appointment of the contributions auditor is made by a request submitted by the legal representative of the company to the President of the Commercial Court, who will decide by order. The applicant may suggest the name of a contribution auditor to the President of the
Ethical framework of the contributions auditor
Regardless of the context of the appointment of the contributions auditor, this appointment is incompatible with any other mission carried out on behalf of the company concerned.
A statutory auditor of a company cannot accept a mission as a contribution or merger auditor for the same company. This situation would lead to a violation of the provisions relating to incompatibilities and could result in disciplinary sanctions, as well as the nullity of the resolutions of the general meetings.
However, no legislative or regulatory provision prohibits a statutory auditor from accepting a mandate in an entity for which he has previously acted as a contribution auditor.
The expertise of Houdart A&C to act as a contributions auditor
Beyond mastering the technical aspects on the fiscal, legal, and accounting fronts of such operations, Houdart Audit & Conseil possesses great agility, allowing them to quickly deploy resources for the execution of a contributions auditor mission.
Our versatile employees have in-depth sector-specific knowledge and, like the partners, have a good understanding of valuation techniques, enabling them to assess the valuations used.
Our legal department contributes to this type of mission by ensuring the legal quality of the drafted documents to secure your operation.