Council Directive 86/635/EEC of 8 December 1986 on the annual accounts and consolidated accounts of banks and other financial institutions
Date: 1986-12-08
Institutions: Council of the European Union
Subjects: accounting system, balance sheet, bank, operating result, publication of accounts













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31986L0635

Council Directive 86/635/EEC of 8 December 1986 on the annual accounts and consolidated accounts of banks and other financial institutions  


Official Journal L 372 , 31/12/1986 P. 0001 - 0017 Finnish special edition: Chapter 6 Volume 2 P. 0136  Swedish special edition: Chapter 6 Volume 2 P. 0136  





COUNCIL DIRECTIVE of 8 December 1986 on the annual accounts and consolidated  accounts of banks and other financial institutions(86/635/EEC)THE COUNCIL OF THE EUROPEAN  COMMUNITIES,Having regard to the Treaty establishing the European Community, and in particular Article  54 (3) (g) thereof,Having regard to the proposal from the Commission (1),(1) OJ No C 130, 1.6.1981, p. 1,  OJ No C 83, 24.3.1984, p. 6 and OJ No C 351, 31.12.1985, p. 24.Having regard to the opinion of the  European Parliament (2),(2) OJ No C 242, 12.9.1983, p. 33 and OJ No C 163, 10.7.1978, p. 60.Having  regard to the opinion of the Economic and Social Committee (3),(3) OJ No C 112, 3.5.1982, p. 60.Whereas  Council Directive 78/660/EEC of 25 July 1978, based on Article 54 (3) (g) of the Treaty, on the annual accounts  of certain types of companies (4), as last amended by Directive 84/569/EEC (5), need not be applied to banks  and other financial institutions, hereafter referred to as 'credit institutions', pending subsequent coordination;  whereas in view of the central importance of these undertakings in the Community, such coordination is  necessary;(4) OJ No L 222, 14.8.1978, p. 11.(5) OJ No L 314, 4.12.1984, p. 28.Whereas Council Directive  83/349/EEC of 13 June 1983, based on Article 54 (3) (g) of the Treaty, on consolidated accounts (6), provides  for derogations for credit institutions only until expiry of the deadline imposed for the application of this  Directive; whereas this Directive must therefore also include provisions specific to credit institutions in respect  of consolidated accounts;(6) OJ No L 193, 18.7.1983, p. 1.Whereas such coordination has also become  urgent because more and more credit institutions are operating across national borders; whereas for creditors,  debtors and members and for the general public improved comparability of the annual accounts and consolidated  accounts of these institutions is of crucial importance;Whereas in virtually all the Member States of the  Community credit institutions within the meaning of Council Directive 77/780/EEC of the 12 December 1977 on  the coordination of laws, regulations and administrative provisions relating to the taking up and pursuit of the  business of credit institutions (7), having many different legal forms, are in competition with one another in the  banking sector; whereas it therefore seems advisable not to confine coordination in respect of these credit  institutions to the legal forms covered by Directive 78/660/EEC but rather to opt for a scope which includes all  companies and firms as defined in the second paragraph of Article 58 of the Treaty;(7) OJ No L 322,  17.12.1977, p. 30.Whereas as far as financial institutions are concerned the scope of this Directive should  however be confined to those financial institutions taking one of the legal forms referred to in Directive  78/660/EEC; whereas financial institutions which are not subject to that Directive must automatically come  under this Directive;Whereas a link with coordination in respect of credit institutions is necessary because  aspects of the provisions governing annual accounts and consolidated accounts will have an impact on other  areas of that coordination, such as authorization requirements and the indicators used for supervisory  purposes;Whereas although, in view of the specific characteristics of credit institutions, it would appear  appropriate to adopt a separate Directive on the annual accounts and consolidated accounts of such institutions,  this does not imply a new set of rules separate from those under Directives 78/660/EEC and 83/349/EEC;  whereas such separate rules would be neither appropriate nor consistent with the principles underlying the  coordination of company law since, given the important role which they play in the Community economy, credit  institutions cannot be excluded from a framework of rules devised for undertakings generally; whereas, for this  reason, only the particular characteristics of credit institutions have been taken into account and this Directive  deals only with exceptions to the rules contained in Directives 78/660/EEC and 83/349/EEC;Whereas the  structure and content of the balance sheets of credit institutions differ in each Member State; whereas this  Directive must therefore prescribe the same layout, nomenclature and terminology for the balance sheets of all  credit institutions in the Community; whereas derogations should be allowed if necessitated by the legal form of  an institution or by the especial nature of its business;Whereas, if the annual accounts and consolidated  accounts are to be comparable, a number of basic questions regarding the disclosure of various transactions in  the balance sheet and off the balance sheet must be settled;Whereas, in the interests of greater comparability, it  is also necessary that the content of the various balance sheet and off-balance sheet items be determined  precisely;Whereas the same applies to the layout and definition of the items in the profit and loss  account;Whereas the comparability of figures in the balance sheet and profit and loss account also depends  crucially on the values at which assets and liabilities are entered in the balance sheet;Whereas, in view of the  particular risks associated with banking and of the need to maintain confidence, provision should be made for the  possibility of introducing a liabilities item in the balance sheet entitled 'Fund for general banking risks'; whereas it  would appear advisable for the same reasons that the Member States be permitted, pending subsequent  coordination, to allow credit institutions some discretion, especially in the valuation of loans and advances and of  certain securities; whereas, however, in this last case the Member States should allow these same credit  institutions to create the «Fund for general banking risks» mentioned above; whereas it would also appear  appropriate to permit the Member States to allow credit institutions to set of certain charges and income in the  profit and loss account;Whereas, in view of the special nature of credit institutions, certain changes are also  necessary with regard to the notes on the accounts;Whereas, in the desire to place on the same footing as many  credit institutions as possible, as was the case with Directive 77/780/EEC, the relief under Directive 78/660/EEC  is not provided for in the case of small and medium-sized credit institutions; whereas, nevertheless, if in the light  of experience such relief were to prove necessary it would be possible to provide for it in subsequent  coordination; whereas for the same reasons the scope allowed the Member States under Directive 83/349/EEC  to exempt parent undertakings from the consolidation requirement if the undertakings to be consolidated do not  together exceed a certain size has not been extended to credit institutions;Whereas the application of the  provisions on consolidated accounts to credit institutions requires certain adjustments to some of the rules  applicable to all industrial and commercial companies; whereas explicit rules have been provided for in the case  of mixed groups and exemption from subconsolidation may be made subject to additional conditions;Whereas,  given the scale on which banking networks extend beyond national borders and their constant development, the  annual accounts and consolidated accounts of a credit institution having its head office in one Member State  should be published in all the Member States in which it is established;Whereas the examination of problems  which arise in connection with the subject matter of this Directive, notably concerning its application, requires  the cooperation of representatives of the Member States and the Commission in a contact committee; whereas,  in order to avoid the proliferation of such committees, it is desirable that such cooperation take place in the  Committee provided for in Article 52 of Directive 78/660/EEC; whereas, nevertheless, when examining  problems concerning credit institutions the Committee will have to be appropriately constituted;Whereas, in  view of the complexity of the matter, the credit institutions covered by this Directive must be allowed a longer  period than usual to implement its provisions;Whereas provision should be made for the review of certain  provisions of this Directive after five years' experience of its application, in the light of the aims of greater  transparency and harmonization,HAS ADOPTED THIS DIRECTIVE:SECTION 1PRELIMINARY  PROVISIONS AND SCOPEArticle 11. Articles 2, 3, 4 (1), (3) to (5), 6, 7, 13, 14, 15 (3) and (4), 16 to 21,  29 to 35, 37 to 41, 42 first sentence, 45 (1), 46, 48 to 50, 51 (1), 54, 56 to 59 and 61 of Directive 78/660/EEC  shall apply to the institutions mentioned in Article 2 of this Directive, except where this Directive provides  otherwise.2. Where reference is made in Directives 78/660/EEC and 83/349/EEC to Articles 9 and 10 (balance  sheet) or to Articles 23 to 26 (profit and loss account) of Directive 78/660/EEC, such references shall be deemed  to be references to Articles 4 (balance sheet) or to Articles 27 and 28 (profit and loss account) of this  Directive.3. References in Directives 78/660/EEC and 83/349/EEC to Articles 31 to 42 of Directive  78/660/EEC shall be deemed to references to those Articles, taking account of Articles 35 to 39 of this  Directive.4. Where reference is made in the aforementioned provisions of Directive 78/660/EEC to balance  sheet items for which this Directive makes no equivalent provision, such references shall be deemed to be  references to the items in Article 4 of this Directive which include the assets and liabilities in question.Article  21. The coordination measures prescribed by this Directive shall apply to(a) credit institutions within the  meaning of the first indent of Article 1 of Directive 77/780/EEC which are companies or firms as defined in the  second paragraph of Article 58 of the Treaty;(b) financial institutions having one of the legal forms referred to  in Article 1 (1), of Directive 78/660/EEC which, on the basis of paragraph 2 of that Article, are not subject to  that Directive.For the purposes of this Directive 'credit institutions' shall also include financial institutions unless  the context requires otherwise.2. The Member States need not apply this Directive to:(a) the credit institutions  listed in Article 2 (2) of Directive 77/780/EEC;(b) institutions of the same Member State which, as defined in  Article 2 (4) (a) of Directive 77/780/EEC, are affiliated to a central body in that Member State. In that case,  without prejudice to the application of this Directive to the central body, the whole constituted by the central  body and its affiliated institutions must be the subject of consolidated accounts including an annual report which  shall be drawn up, audited and published in accordance with this Directive;(c) the following credit  institutions:- in Greece: ETEBA (National Investment Bank for Industrial Development) and ******* ***** ***** (Investment Bank),- in Ireland: Industrial and Provident Societies,- in the United Kingdom: Friendly  Societies and Industrial and Provident Societies.4. Without prejudice to Article 2 (3) of Directive 78/660/EEC  and pending subsequent coordination, the Member States may:(a) in the case of the credit institutions referred  to in Article 2 (1) (a) of this Directive which are not companies of any of the types listed in Article 1 (1) of  Directive 78/660/EEC, lay down rules derogating from this Directive where derogating rules are necessary  because of such institutions' legal form;(b) in the case of specialized credit institutions, lay down rules  derogating from this Directive where derogating rules are necessary because of the special nature of such  institutions' business.Such derogating rules may provide only for adaptations to the layout, nomenclature,  terminology and content of items in the balance sheet and the profit and loss account; they may not have the  effect of permitting the institutions to which they apply to provide less information in their annual accounts than  other institutions subject to this Directive.The Member States shall inform the Commission of those credit  institutions, possibly by category, within six months of the end of the period stipulated in Article 47 (2). They  shall inform the Commission of the derogations laid down to that end.These derogations shall be reviewed  within 10 years of the notification of this Directive. The Commission shall, if appropriate, submit suitable  proposals. It shall also submit an interim report within five years of the notification of this Directive.SECTION  2GENERAL PROVISIONS CONCERNING THE BALANCE SHEET AND THE PROFIT AND LOSS  ACCOUNTArticle 3In the case of credit institutions the possibility of combining items pursuant to Article 4  (3) (a) or (b) of Directive 78/660/EEC shall be restricted to balance sheet and profit and loss account sub-items  preceded by lower-case letters and shall be authorized only under the rules laid down by the Member States to  that end.SECTION 3LAYOUT OF THE BALANCE SHEETThe Member States shall prescribe the  following layout for the balance sheet.Assets1. Cash in hand, balances with central banks and post office  banks.2. Treasury bills and other bills eligible for refinancing with central banks:(a) Treasury bills and similar  securities(b) Other bills eligible for refinancing with central banks (unless national law prescribes that such bills  be shown under Assets items 3 and 4)3. Loans and advances to credit institutions:(a) repayable on  demand(b) other loans and advances4. Loans and advances to customers5. Debt securities including fixed- income securities:(a) issued by public bodies(b) issued by other borrowers, showing separately:- own-debt  securities (unless national law requires their deduction from liabilities).6. Shares and other variable-yield  securities7. Participating interests, showing separately:- participating interests in credit institutions (unless  national law requires their disclosure in the notes on the accounts)8. Shares in affiliated undertakings, showing  separately:- shares in credit institutions (unless national law requires their disclosure in the notes on the  accounts)9. Intangible assets as described under Assets headings B and C.I of Article 9 of Directive  78/660/EEC, showing separately:- formation expenses, as defined by national law and in so far as national law  permits their being shown as an asset (unless national law requires their disclosure in the notes on the  accounts)- goodwill, to the extent that it was acquired for valuable consideration (unless national law requires  its disclosure in the notes on the accounts)10. Tangible assets as described under Assets heading C.II of Article  9 of Directive 78/660/EEC, showing separately:- land and buildings occupied by a credit institution for its own  activities (unless national law requires their disclosure in the notes on the accounts)11. Subscribed capital  unpaid, showing separately:- called-up capital (unless national law provides for called-up capital to be included  liabilities, in which case capital called but not yet paid must be included either in this Assets item or in Assets  item 14)12. Own shares (with an indication of their nominal value or, in the absence of a nominal value, their  accounting par value to the extend that national law permits their being shown in the balance sheet)13. Other  assets14. Subscribed capital called but not paid (unless national law requires that called-up capital be shown  under Assets item 1115. Prepayments and accrued income16. Loss for the financial year (unless national law  provides for its inclusion under Liabilities item 14)Total assetsLiabilities1. Amounts owed to credit  institutions:(a) repayable on demand(b) with agreed maturity dates or periods of notice2. Amounts owed to  customers:(a) savings deposits, showing separately:- those repayable on demand and those with agreed  maturity dates or periods of notice where national law provides for such a breakdown (unless national law  provides for such information to be given in the notes on the accounts)(b) other debts(ba) repayable on  demand(bb) with agreed maturity dates or periods of notice3. Debts evidenced by certificates:(a) debt  securities in issue(b) others4. Other liabilities5. Accruals and deferred income6. Provisions for liabilities and  charges:(a) provisions for pensions and similar obligations(b) provisions for taxation(c) other provisions7.  Profit for the financial year (unless national law provides for its inclusion under Liabilities item 14)8.  Subordinated liabilities9. Subscribed capital (unless national law provides for called-up capital to be shown  under this item. In that case, the amounts of subscribed capital and paid-up capital must be shown separately)0.  Share premium account1. Reserves2. Revaluation reserve3. Profit or loss brought forward4. Profit or loss  for the financial year (unless national law requires that this item be shown under Assets item 16 or Liabilities  item 7)Total liabilitiesOff-balance sheet items1. Contingent liabilities, showing separately:- acceptances and  endorsements- guarantees and assets pledged as collateral security2. Commitments, showing separately:-  commitments arising out of sale and repurchase transactionsArticle 5The following must be shown separately  as sub-items of the items in question:- claims, whether or not evidenced by certificates, on affiliated  undertakings and included in Assets items 2 to 5,- claims, whether or not evidenced by certificates, on  undertakings with which a credit institution is linked by virtue of a participating interest and included in Assets  items 2 to 5,- liabilities, whether or not evidenced by certificates, to affiliated undertakings and included in  Liabilities items 1, 2, 3 and 8.- liabilities, whether or not evidenced by certificates, to undertakings with which a  credit institution is linked by virtue of a participating interest and included in Liabilities items 1, 2, 3 and  8.Article 61. Subordinated assets shall be shown separately as sub-items of the items of the layout and the  sub-items created in accordance with Article 5.2. Assets, whether or not evidenced by certificates, are  subordinated if, in the event of winding up or bankruptcy, they are to be repaid only after the claims of other  creditors have been met.Article 7The Member States may permit the disclosure of the information referred to  in Articles 5 and 6, duly broken down into the various relevant items, in the notes on the accounts.Article 81.  Assets shall be shown under the relevant balance sheet headings even where the credit institution drawing up the  balance sheet has pledged them as security for its own liabilities or for those of third parties or has otherwise  assigned them as security to third parties.2. A credit institution shall not include in its balance sheet assets  pledged or otherwise assigned to it as security unless such assets are in the form of cash in the hands of that  credit institution.Article 91. Where a loan has been granted by a syndicate consisting of a number of credit  institutions, each credit institution participating in the syndicate shall disclose only that part of the total loan  which it has itself funded.2. If in the case of a syndicated loan such as described in paragraph 1 the amount of  funds guaranteed by a credit institution exceeds the amount which it has made available, any additional guarantee  portion shall be shown as a contingent liability (in Off-balance sheet item 1, second indent).Article 101. Funds  which a credit institution administers in its own name but on behalf of third parties must be shown in the balance  sheet if the credit institution acquires legal title to the assets concerned. The total amount of such assets and  liabilities shall be shown separately or in the notes on the accounts, broken down according to the various Assets  and Liabilities items. However, the Member States may permit the disclosure of such funds off the balance sheet  provided there are special rules whereby such funds can be excluded from the assets available for distribution in  the event of the winding-up of a credit institution (or similar proceedings).2. Assets acquired in the name of and  on behalf of third parties must not be shown in the balance sheet.Article 11Only those amounts which can at  any time be withdrawn without notice or for which a maturity or period of notice of 24 hours or one working  day has been agreed shall be regarded as repayable on demand.Article 121. Sale and repurchase transactions  shall mean transactions which involve the transfer by a credit institution or customer (the 'transferor') to another  credit institution or customer (the 'transferee') of assets, for example, bills, debts or transferable securities,  subject to an agreement that the same assets will subsequently be transferred back to the transferor at a specified  price.2. If the transferee undertakes to return the assets on a date specified or to be specified by the transferor,  the transaction in question shall be deemed to be a genuine sale and repurchase transaction.3. If, however, the  transferee is merely entitled to return the assets at the purchase price or for a different amount agreed in advance  on a date specified or to be specified, the transaction in question shall be deemed to be a sale with an option to  repurchase.4. In the case of the sale and repurchase transactions referred to in paragraph 2, the assets  transferred shall continue to appear in the transferor's balance sheet; the purchase price received by the transferor  shall be shown as an amount owed to the transferee. In addition, the value of the assets transferred shall be  disclosed in a note in the transferor's accounts. The transferee shall not be entitled to show the assets transferred  in his balance sheet; the purchase price paid by the transferee shall be shown as an amount owed by the  transferor.5. In the case of the sale and repurchase transactions referred to in paragraph 3, however, the  transferor shall not be entitled to show in his balance sheet the assets transferred; those items shall be shown as  assets in the transferee's balance sheet. The transferor shall enter under Off-balance sheet item 2 an amount equal  to the price agreed in the event of repurchase.6. No forward exchange transactions, options, transactions  involving the issue of debt securities with a commitment to repurchase all or part of the issue before maturity of  any similar transactions shall be regarded as sale and repurchase transactions within the meaning of this  Article.SECTION 4SPECIAL PROVISIONS RELATING TO CERTAIN BALANCE SHEET  ITEMSArticle 13Assets: Item 1 - Cash in hand, balances with central banks and post office banks1. Cash in  hand shall comprise legal tender including foreign notes and coins.2. This item may include only balances with  the central banks and post office banks of the country or countries in which a credit institution is established.  Such balances must be a readily available at all times. Other claims on such bodies must be shown as loans and  advances to credit institution (Assets item 3) or as loans and advances to customers (Assets item 4).Article  14Assets: Item 2 - Treasury bills and other bills eligible for refinancing with central banks1. This item shall  comprise, under (a), treasury bills and similar securities, i. e. treasury bills, treasury certificates and similar debt  instruments issued by public bodies which are eligible for refinancing with the central banks of the country or  countries in which a credit institution is established. Those debt instruments issued by public bodies which fail to  meet the above condition shall be shown under Assets sub-item 5 (a).2. This item shall comprise, under (b),  bills eligible for refinancing with central banks, i. e. all bills held in portfolio what were purchased from credit  institutions or from customers to the extent that they are eligible, under national law, for refinancing with the  central banks of the country or countries in which a credit institution is established.Article 15Assets: Item 3 -  Loans and advances to credit Institutions1. Loans and advances to credit institutions shall comprise all loans  and advances arising out of banking transactions to domestic or foreign credit institutions by the credit  institution drawing up the balance sheet, regardless of their actual designations.The only exception shall be  loans and advances represented by debt securities or any other security, which must be shown under Assets item  5.2. For the purposes of this Article credit institutions shall comprise all undertakings on the list published in  the Official Journal of the European Communities pursuant to Article 3 (7) of Directive 77/780/EEC, as well as  central banks and official domestic and international banking organizations and all private and public  undertakings which are not established in the Community but which satisfy the definition in Article 1 of Directive  77/780/EEC.Loans and advances to undertakings which do not satisfy the above conditions shall be shown  under Assets item 4.Article 16Assets: Item 4 - Loans and advances to customersLoans and advances to  customers shall comprise all types of assets in the form of claims on domestic and foreign customers other than  credit institutions, regardless of their actual designations.The only exception shall be loans and advances  represented by debt securities or any other security, which must be shown under Assets item 5.Article  17Assets: Item 5 - Debt securities including fixed-income securities1. This item shall comprise negotiable debt  securities including fixed-income securities issued by credit institutions, by other undertakings or by public  bodies; such securities issued by the latter, however, shall be included only if they are not to be shown under  Assets item 2.2. Securities bearing interest rates that vary in accordance with specific factors, for example the  interest rate on the inter-bank market or on the Euromarket, shall also be regarded as debt securities including  fixed-income securities.3. Only repurchase and negotiable own-debt securities may be included in sub-item 5  (b).Article 18Liabilities: Item 1 - Amounts owed to credit institutions1. Amounts owed to credit institutions  shall include all amounts arising out of banking transactions owed to other domestic or foreign credit institutions  by the credit institution drawing up the balance sheet, regardless of their actual designations.The only exception  shall be liabilities represented by debt securities or by any other security, which must be shown under Liabilities  item 3.2. For the purposes of this Article credit institutions shall comprise all undertakings on the list published  in the Official Journal of the European Communities pursuant to Article 3 (7) of Directive 77/780/EEC, as well  as central banks and official domestic and international banking organizations and all private and public  undertakings which are not established in the Community but which satisfy the definition in Article 1 of Directive  77/780/EEC.Article 19Liabilities: Item 2 - Amounts owed to customers1. Amounts owed to customers shall  include all amounts owed to creditors that are not credit institutions within the meaning of Article 18, regardless  of their actual designations.The only exception shall be liabilities represented by debt securities or by any other  security, which must be shown under Liabilities item 3.2. Only deposits which satisfy the conditions laid down  in national law shall be treated as savings deposits.3. Savings bonds shall be shown under the corresponding  sub-item only if they are not represented by negotiable certificates.Article 20Liabilities: Item 3 - Debts  evidenced by certificates1. This item shall include both debt securities and debts for which negotiable  certificates have been issued, in particular deposit receipts, «bons de caisse» and liabilities arising out of own  acceptances and promissory notes.2. Only acceptances which a credit institution has issued for ist own  refinancing and in respect of which it is the first party liable ('drawee') shall be treated as own  acceptances.Article 21Liabilities: Item 8 - Subordinated liabilitiesWhere it has been contractually agreed that,  in the event of winding up or of bankruptcy, liabilities, whether or not evidenced by certificates, are to be repaid  only after the claims of all other creditors have been met, the liabilities in question shall be shown under this  item.Article 22Liabilities: Item 9 - Subscribed capitalThis item shall comprise all amounts, regardless of their  actual designations, which, in accordance with the legal structure of the institution concerned, are regarded  under national law as equity capital subscribed by the shareholders or other proprietors.Article 23Liabilities:  Item 11 - ReservesThis item shall comprise all the types of reserves listed in Article 9 of Directive 78/660/EEC  under Liabilities item A.IV, as defined therein. The Member States may also prescribe other types of reserves if  necessary for credit institutions the legal structures of which are not covered by Directive 78/660/EEC.The  types of reserve referred to in the first paragraph shall be shown separately, as sub-items of Liabilities item 11, in  the balance sheets of the credit institutions concerned, with the exception of the revaluation reserve which shall  be shown under item 12.Article 24Off-balance sheet: Item 1 - Contingent liabilitiesThis item shall comprise  all transactions whereby an institution has underwritten the obligations of a third party.Notes on accounts shall  state the nature and amount of any type of contingent liability which is material in relation to an institution's  activities.Liabilities arising out of the endorsement of rediscounted bills shall be included in this item only if  national law does not require otherwise. The same shall apply to acceptances other than own  acceptances.Sureties and assets pledged as collateral security shall include all guarantee obligations incurred  and assets pledged as collateral security on behalf of third parties, particularly in respect of sureties and  irrevocable letters of credit.Article 25Off-balance sheet: Item 2 - CommitmentsThis item shall include every  irrevocable commitment which could give rise to a risk.Notes on accounts shall state the nature and amount of  any type of commitment which is material in relation to an institution's activities.Commitments arising out of  sale and repurchase transactions shall include commitments entered into by a credit institution in the context of  sale and repurchase transactions (on the basis of firm agreements to sell with options to repurchase) within the  meaning of Article 12 (3).SECTION 5LAYOUT OF THE PROFIT AND LOSS ACCOUNTArticle 26For  the presentation of the profit and loss account, the Member States shall prescribe one or both of the layouts  provided for in Articles 27 and 28. If a Member State prescribes both layouts it may allow undertakings to  choose between them.Article 27Vertical layout1. Interest receivable and similar income, showing separately  that arising from fixed-income securities2. Interest payable and similar charges3. Income from securities:(a)  Income from shares and other variable-yield securities(b) Income from participating interests(c) Income from  shares in affiliated undertakings4. Commissions receivable5. Commissions payable6. Net profit or net loss on  financial operations7. Other operating income8. General administrative expenses:(a) Staff costs, showing  separately:- wages and salaries- social security costs, with a separate indication of those relating to  pensions(b) Other administrative expenses9. Value adjustments in respect of Assets items 9 and 1010. Other  operating charges11. Value adjustments in respect of loans and advances and provisions for contingent  liabilities and for commitments.12. Value re-adjustments in respect of loans and advances and provisions for  contingent liabilities and for commitments.13. Value adjustments in respect of transferable securities held as  financial fixed assets, participating interests and shares in affiliated undertakings14. Value re-adjustments in  respect of transferable securities held as financial fixed assets, participating interests and shares in affiliated  undertakings15. Tax on profit or loss on ordinary activities16. Profit or loss on ordinary activities after  tax17. Extraordinary income18. Extraordinary charges19. Extraordinary profit or loss20. Tax on  extraordinary profit or loss21. Extraordinary profit or loss after tax22. Other taxes not shown under the  preceeding items23. Profit or loss for the financial yearArticle 28Horizontal layoutA. Charges1. Interest  payable and similar charges2. Commissions payable3. Net loss on financial operations4. General  administrative expenses:(a) Staff costs, showing separately:- wages and salaries- social security costs, with a  separate indication of those relating to pensions(b) Other administrative expenses5. Value adjustments in  respect of Assets items 9 and 106. Other operating charges7. Value adjustments in respect of loans and  advances and provisions for contingent liabilities and for commitments8. Value adjustments in respect of  transferable securities held as financial fixed assets, participating interests and shares in affiliated undertakings9.  Tax on profit or loss on ordinary activities10. Profit or loss on ordinary activities after tax11. Extraordinary  charges12. Tax on extraordinary profit or loss13. Extraordinary loss after tax14. Other taxes not shown  under the preceding items15. Profit for the financial yearB. Income1. Interest receivable and similar income,  showing separately that arising from fixed-income securities2. Income from securities:(a) Income from shares  and other variable-yield securities(b) Income from participating interests(c) Income from shares in affiliated  undertakings3. Commissions receivable4. Net profit on financial operations5. Value re-adjustments in respect  of loans and advances and provisions for contingent liabilities and for commitments6. Value re-adjustments in  respect of transferable securities held as financial fixed assets, participating interests and shares in affiliated  undertakings7. Other operating income8. Profit or loss on ordinary activities after tax9. Extraordinary  income10. Extraordinary profit after tax11. Loss for the financial yearSECTION 6SPECIAL  PROVISIONS RELATING TO CERTAIN ITEMS IN THE PROFIT AND LOSS ACCOUNTArticle  29Article 27, items 1 and 2 (vertical layout)Article 28, items A 1 and B 1 (horizontal layout)Interest  receivable and similar income and interest payable and similar charges.These items shall include all profits and  losses arising out of banking activities, including:(1) all income from assets entered under Assets items 1 to 5 in  the balance sheet, however calculated. Such income shall also include income arising from the spreading on a  time basis of the discount on assets acquired at an amount below, and liabilities contracted at an amount above,  the sum payable at maturity;(2) all charges arising out of liabilities entered under Liabilities items 1, 2, 3 and 8,  however calculated. Such charges shall also include charges arising from the spreading on a time basis of the  premium on assets acquired at an amount above, and liabilities contracted at an amount below, the sum payable  at maturity;(3) income and charges resulting from covered forward contracts, spread over the actual duration of  the contract and similar in nature to interest;(4) fees and commission similar in nature to interest and calculated  on a time basis or by reference to the amount of the claim or liability.Article 30Article 27, item 3 (vertical  layout)Article 28, item B 2 (horizontal layout)Income from shares and other variable-yield securities, from  participating interests, and from shares in affiliated undertakingsThis item shall comprise all dividends and other  income from variable-yield securities, from participating interests and from shares in affiliated undertakings.  Income from shares in investment companies shall also be included under this item.Article 31Article 27, items  4 and 5 (vertical layout)Article 28, items A 2 and B 3 (horizontal layout)Commissions receivable and  commissions payableWithout prejudice to Article 29, commissions receivable shall include income in respect of  all services supplied to third parties, and commissions payable shall include charges for services rendered by third  parties, in particular- commissions for guarantees, loans administration on behalf of other lenders and securities  transactions on behalf of third parties,- commissions and other charges and income in respect of payment  transactions, account administration charges and commissions for the safe custody and administration of  securities,- commissions for foreign currency transactions and for the sale and purchase of coin and precious  metals on behalf of third parties,- commissions charges for brokerage services in connection with savings and  insurance contracts and loans.Article 32Article 27, item 6 (vertical layout)Article 28, item A 3 or item B 4  (horizontal layout)Net profit or net loss on financial operations.This item covers:1. the net profit or loss on  transactions in securities which are not held as financial fixed assets together with value adjustments and value  re-adjustments on such securities, taking into account, where Article 36 (2) has been applied, the difference  resulting from application of that article; however, in those Member States which exercise the option provided  for in Article 37, these net profits or losses and value adjustments and value re-adjustments shall be included only  in so far as they relate to securities included in a trading portfolio;2. the net profit or loss on exchange  activities, without prejudice to Article 29, point 3;3. the net profits and losses on other buying and selling  operations involving financial instruments, including precious metals.Article 33Article 27, items 11 and 12  (vertical layout)Article 28, items A 7 and B 5 (horizontal layout)Value adjustments in respect of loans and  advances and provisions for contingent liabilities and for commitmentsValue re-adjustments in respect of loans  and advances and provisions for contingent liabilities and for commitments.1. These items shall include, on the  one hand, charges for value adjustments in respect of loans and advances to be shown under Assets items 3 and  4 and provisions for contingent liabilities and for commitments to be shown under Off-balance sheet items 1 and  2, on the other hand, credits from the recovery of written-off loans and advances and amounts written back  following earlier value adjustments and provisions.2. In those Member States which exercise the option  provided for in Article 37, this item shall also include the net profit or loss on transactions in securities included  in Assets items 5 and 6 which are neither held as financial fixed Assets as defined in Article 35 (2) nor included  in a trading portfolio, together with value adjustments and value re-adjustments on such securities taking into  account, where Article 36 (2) has been applied, the difference resulting from application of that article. The  nomenclature of this item shall be adapted accordingly.3. The Member States may permit the charges and  income covered by these items to be set off against each other, so that only a net item (income or charge) is  shown.4. Value adjustments in respect of loans and advances to credit institutions, to customers, to  undertakings with which a credit institution is linked by virtue of participating interests and to affiliated  undertakings shall be shown separately in the notes on the accounts where they are material. This provision need  not be applied if a Member State permits setting-off pursuant to paragraph 3.Article 34Article 27, items 13  and 14 (vertical layout)Article 28, items A 8 and B 5 (horizontal layout)Value adjustments in respect of  transferable securities held as financial fixed assets, participating interests and shares in affiliated  undertakingsValue re-adjustments in respect of transferable securities held as financial fixed assets, participating  interests and shares in affiliated undertakings.1. These items shall include, on the one hand, charges for value  adjustments in respect of assets shown in Assets items 5 to 8 and, on the other hand, all the amounts written  back following earlier value adjustments, in so far as the charges and income relate to transferable securities held  as financial fixed assets as defined in Article 35 (2), participating interests and shares in affiliated  undertakings.2. The Member States may permit the charges and income covered by these items to be set off  against each other, so that only a net item (income or charge) is shown.3. Value adjustments in respect of these  transferable securities, participating interests and shares in affiliated undertakings shall be shown separately in the  notes on the accounts where they are material. This provision need not be applied if a Member State permits  setting off pursuant to paragraph 2.SECTION 7VALUATION RULESArticle 351. Assets items 9 and 10  must be valued as fixed assets. The assets included in other balance sheet items shall be valued as fixed assets  where they are intended for use on a continuing basis in the normal course of an undertakings's activities.2.  Where reference is made to financial fixed assets in Section 7 of Directive 78/660/EEC, this term shall in the  case of credit institutions be taken to mean participating interests, shares in affiliated undertakings and securities  intended for use on a continuing basis in the normal course of an undertaking's activities.3. (a) Debt securities  including fixed-income securities held as financial fixed assets shall be shown in the balance sheet at purchase  price. The Member States may, however, require or permit such debt securities to be shown in the balance sheet  at the amount repayable at maturity.(b) Where the purchase price of such debt securities exceeds the amount  repayable at maturity the amount of the difference must be charged to the profit and loss account. The Member  States may, however, require or permit the amount of the difference to be written off in instalments so that it is  completely written off by the time when the debt securities are repaid. The difference must be shown separately  in the balance sheet or in the notes on the accounts.(c) Where the purchase price of such debt securities is less  than the amount repayable at maturity, the Member States may require or permit the amount of the difference to  be released to income in instalments over the period remaining until repayment. The difference must be shown  separately in the balance sheet or in the notes on the accounts.Article 361. Where transferable securities which  are not held as financial fixed assets are shown in the balance sheet at purchase price, credit institutions shall  disclose in the notes on their accounts the difference between the purchase price and the higher market value of  the balance sheet date.2. The Member States may, however, require or permit those transferable securities to be  shown in the balance sheet at the higher market value at the balance sheet date. The difference between the  purchase price and the higher market value shall be disclosed in the notes on the accounts.Article 371. Article  39 of Directive 78/660/EEC shall apply to the valuation of credit institutions' loans and advances, debt securities,  shares and other variable-yield securities which are not held as financial fixed assets.2. Pending subsequent  coordination, however, the Member States may permit:(a) loans and advances to credit institutions and  customers (Assets items 3 and 4) and debt securities, shares and other variable-yield securities included in Assets  items 5 and 6 which are neither held as financial fixed assets as defined in Article 35 (2) not included in a trading  portfolio to be shown at a value lower than that which would result from the application of Article 39(1) of  Directive 78/660/EEC, where that is required by the prudence dictated by the particular risks associated with  banking. Nevertheless, the difference between the two values must not be more than 4% of the total amount of  the assets mentioned above after application of the aforementioned Article 39;(b) that the lower value resulting  from the application of subparagraph (a) be maintained until the credit institution decides to adjust it;(c) where  a Member State exercises the option provided for in subparagraph (a), neither Article 36 (1) of this Directive nor  Article 40 (2) of Directive 78/660/EEC shall apply.Article 381. Pending subsequent coordination, those  Member States which exercise the option provided for in Article 37 must permit and those Member States which  do not exercise that option may permit the introduction of a Liabilities item 6 A entitled 'Fund for general  banking risks'. That item shall include those amounts which a credit institution decides to put aside to cover such  risks where that is required by the particular risks associated with banking.2. The net balance of the increases  and decreases of the 'Fund for general banking risks' must be shown separately in the profit and loss  account.Article 391. Assets and liabilities denominated in foreign currency shall be translated at the spot rate  of exchange ruling on the balance sheet date. The Member States my, however, require or permit assets held as  financial fixed assets and tangible and intangible assets, no covered or not specifically covered in either the spot  or forward markets, to be translated at the rates ruling on the dates of their acquisition.2. Uncompleted forward  and spot exchange transactions shall be translated at the spot rates of exchange ruling on the balance sheet  date.The Member States may, however, require forward transactions to be translated at the forward rate ruling  on the balance sheet date.3. Without prejudice to Article 29(3), the differences between the book values of the  assets, liabilities and forward transactions and the amounts produced by translation in accordance with  paragraphs 1 and 2 shall be shown in the profit and loss account. The Member States may, however, require or  permit differences produced by translation in accordance with paragraphs 1 and 2 to be included, in whole or in  part, in reserves not available for distribution, where they arise on assets held as financial fixed assets, on tangible  and intangible assets and on any transactions undertaken to cover those assets.4. The Member States may  provide that positive translation differences arising out of forward transactions, assets or liabilities not covered  or not specifically covered by other forward transactions, or by assets or liabilities shall not be shown in the  profit and loss account.5. If a method specified in Article 59 of Directive 78/660/EEC is used, the Member  States may provide that any translation differences shall be transferred, in whole or in part, directly to reserves.  Positive and negative translation differences transferred to reserves shall be shown separately in the balance sheet  or in the notes on the accounts.6. The Member States may require or permit translation differences arising on  consolidation out of the retranslation of an affiliated undertaking's capital and reserves or the share of a  participating interest's capital and reserves at the beginning of the accounting period to be included, in whole or  in part, in consolidated reserves, together with the translation differences arising on the translation of any  transactions undertaken to cover that capital and those reserves.7. The Member States may require or permit  the income and expenditure of affiliated undertakings and participating interests to be translated on consolidation  at the average rates of exchange ruling during the accounting period.SECTION 8CONTENTS OF THE  NOTES ON THE ACCOUNTSArticle 401. Article 43 (1) of Directive 78/660/EEC shall apply, subject to  Article 37 of this Directive and to the following provisions.2. In addition to the information required under  Article 43 (1) (5) of Directive 78/660/EEC, credit institutions shall disclose the following information relating to  Liabilities item 8 (Subordinated liabilities):(a) in respect of each borrowing which exceeds 10% of the total  amount of the subordinated liabilities:(i) the amount of the borrowing, the currency in which it is denominated,  the rate of interest and the maturity date or the fact that it is a perpetual issue;(ii) whether there are any  circumstances in which early repayment is required;(iii) the terms of the subordination, the existence of any  provisions to convert the subordinated liability into capital or some other form of liability and the terms of any  such provisions.(b) an overall indication of the rules governing other borrowings.3. (a) In place of the  information required under Article 43 (1) (6) of Directive 78/660/EEC, credit institutions shall in the notes on  their accounts state separately for each of the Assets items 3 (b) and 4 and the Liabilities items 1 (b), 2 (a), 2 (b)  (bb) and 3 (b) the amounts of those loans and advances and liabilities on the basis of their remaining maturity as  follows:- not more than three months,- more than three months but not more than one year,- more than one  year but not more than five years,- more than five years.For Assets item 4, loans and advances on call and at  short notice must also be shown.If loans and advances or liabilities involve payment by instalments, the  remaining maturity shall be the period between the balance sheet date and the date on which each instalment falls  due.However, for five years after the date referred to in Article 47 (2) the Member States may require or permit  the listing by maturity of the assets and liabilities referred to in this Article to be based on the originally agreed  maturity or period of notice. In that event, where a credit institution has acquired an existing loan not evidenced  by a certificate, the Member States shall require classification of that loan to be based on the remaining maturity  as at the date on which it was acquired. For the purposes of this subparagraph, the originally agreed maturity for  loans shall be the period between the date of first drawing and the date of repayment; the period of notice shall  be deemed to be the period between the date on which notice is given and the date on which repayment is to be  made; if loans and advances or liabilities are redeemable by instalments, the agreed maturity shall be the period  between the date on which such loans and advances or liabilities arose and the date on which the last instalment  falls due. Credit institutions shall also indicate for the balance sheet items referred to in this subparagraph what  proportion of those assets and liabilities will become due within one year of the balance sheet date.(b) Credit  institutions shall, in respect of Assets item 5 (Debt securities including fixed-income securities) and Liabilities  item 3 (a) (Debt securities in issue), indicate what proportion of assets and liabilities will become due within one  year of the balance sheet date.(c) The Member States may require the information referred to in subparagraphs  (a) and (b) to be given in the balance sheet.(d) Credit institutions shall give particulars of the assets which they  have pledged as security for their own liabilities or for those of third parties (including contingent liabilities); the  particulars should be in sufficient detail to indicate for each Liabilities item and for each Off-balance sheet item  the total amount of the assets pledged as security.4. Where credit institutions have to provide the information  referred to in Article 43 (1) (7) of Directive 78/660/EEC in Off-balance sheet items, such information need not  be repeated in the notes on the accounts.5. In place of the information required under Article 43 (1) (8) of  Directive 78/660/EEC, a credit institution shall indicate in the notes on its accounts the proportion of its income  relating to items 1, 3, 4, 6 and 7 of Article 27 or to items B 1, B 2, B 3, B 4 and B 7 of Article 28 by  geographical markets, in so far as, taking account of the manner in which the credit institution is organized,  those markets differ substantially from one another. Article 45 (1) (b) of Directive 78/660/EEC shall apply.6.  The reference in Article 43 (1) (9) of Directive 78/660/EEC to Article 23 (6) of that Directive shall be deemed to  be a reference to Article 27 (8) or Article 28 (A 4) of this Directive.7. By way of derogation from Article 43  (1) (13) of Directive 78/660/EEC, credit institutions need disclose only the amounts of advances and credits  granted to the members of their administrative, managerial and supervisory bodies, and the commitments entered  into on their behalf by way of guarantees of any kind. That information must be given in the form of a total for  each category.Article 411. The information prescribed in Article 15 (3) of Directive 78/660/EEC must be  given in respect of assets held as fixed assets as defined in Article 35 of this Directive. The obligation to show  value adjustments separately shall not, however, apply where a Member State has permitted set-offs between  value adjustments pursuant to Article 34 (2) of this Directive. In that event value adjustments may be combined  with other items.2. The Member States shall require credit institutions to give the following information as well  in the notes on their accounts:(a) a breakdown of the transferable securities shown under Assets items 5 to 8  into listed and unlisted securities;(b) a breakdown of the transferable securities shown under Assets items 5 and  6 into securities which, pursuant to Article 35, are or are not held as financial fixed assets and the criterion used  to distinguish between the two categories of transferable securities;(c) the value of leasing transactions,  apportioned between the relevant balance sheet items;(d) a breakdown of Assets item 13, Liabilities item 4,  items 10 and 18 in the vertical layout or A 6 and A 11 in the horizontal layout and items 7 and 17 in the vertical  layout or B 7 and B 9 in the horizontal layout in the profit and loss account into their main component amounts,  where such amounts are important for the purpose of assessing the annual accounts, as well as explanations of  their nature and amount;(e) the charges paid on account of subordinated liabilities by a credit institution in the  year under review;(f) the fact that an institution provides management and agency services to third parties  where the scale of business of that kind is material in relation to the institution's activities as a whole;(g) the  aggregate amounts of assets and of liabilities denominated in foreign currencies, translated into the currency in  which the annual accounts are drawn up;(h) a statement of the types of unmatured forward transactions  outstanding at the balance sheet date indicating, in particular, for each type of transaction, whether they are  made to a material extent for the purpose of hedging the effects of fluctuations in interest rates, exchange rates  and market prices, and whether they are made to a material extent for dealing purposes. These types of  transaction shall include all those in connection with which the income or expenditure is to be included in Article  27, item 6, Article 28, items A 3 or B 4 or Article 29 (3), for example, foreign currencies, precious metals,  transferable securities, certificates of deposit and other assets.SECTION 9PROVISIONS RELATING TO  CONSOLIDATED ACCOUNTSArticle 421. Credit institutions shall draw up consolidated accounts and  consolidated annual reports in accordance with Directive 83/349/EEC, in so far as this section does not provide  otherwise.2. Insofar as a Member State does not have recourse to Article 5 of Directive 83/349/EEC,  paragraph 1 of this Article shall also apply to parent undertakings the sole object of which is to acquire holdings  in subsidiary undertakings and to manage such holdings and turn them to profit, where those subsidiary  undertakings are either exclusively or mainly credit institutions.Article 431. Directive 83/349/EEC shall apply,  subject to Article 1 of this Directive and paragraph 2 of this Article.2. (a) Articles 4, 6, 15 and 40 of Directive  83/349/EEC shall not apply.(b) The Member States may make application of Article 7 of Directive 83/349/EEC  subject to the following additional conditions:- the parent undertaking must have declared that it guarantees the  commitments entered into by the exempted undertaking; the existence of that declaration shall be disclosed in the  accounts of the exempted undertaking;- the parent undertaking must be a credit institution within meaning of  Article 2 (1) (a) of this Directive.(c) The information referred to in the first two indents of Article 9 (2) of  Directive 83/349/EEC, namely:- the amount of the fixed assets and- the net turnovershall be replaced by:-  the sum of items 1, 3, 4, 6 and 7 in Article 27 or B 1, B 2, B 3, B 4 and B 7 in Article 28 of this Directive.(d)  Where, as a result of applying Article 13 (3) (c) of Directive 83/349/EEC, a subsidiary undertaking which is a  credit institution is not included in consolidated accounts but where the shares of that undertaking are  temporarily held as a result of a financial assistance operation with a view to the reorganization or rescue of the  undertaking in question, the annual accounts of that undertaking shall be attached to the consolidated accounts  and additional information shall be given in the notes on the accounts concerning the nature and terms of the  financial assistance operation.(e) A Member State may also apply Article 12 of Directive 83/349/EEC to two or  more credit institutions which are not connected as described in Article 1 (1) or (2) of that Directive but are  managed on a unified basis other than pursuant to a contract or provisions in the memorandum or articles of  association.(f) Article 14 of Directive 83/349/EEC, with the exception of paragraph 2, shall apply subject to the  following provision.Where a parent undertaking is a credit institution and where one or more subsidiary  undertakings to be consolidated do not have that status, those subsidiary undertakings shall be included in the  consolidation if their activities are a direct extension of banking or concern services ancillary to banking, such as  leasing, factoring, the management of unit trusts, the management of dataprocessing services or any other similar  activity.(g) For the purposes of the layout of consolidated accounts:- Articles 3, 5 to 26 and 29 to 34 of this  Directive shall apply;- the reference in Article 17 of Directive 83/349/EEC to Article 15 (3) of Directive  78/660/EEC shall apply to the assets deemed to be fixed assets pursuant to Article 35 of this Directive.(h)  Article 34 of Directive 83/349/EEC shall apply in respect of the contents of the notes on consolidated accounts,  subject to Articles 40 and 41 of this Directive.SECTION 10PUBLICATONArticle 441. The duly approved  annual accounts of credit institutions together with the annual reports and the reports by the persons responsible  for auditing the accounts shall be published as laid down by national law in accordance with Article 3 of  Directive 68/151/EEC (1).(1) OJ No L 65, 14.3.1968, p. 8.National law may, however, permit the annual  report not to be published as stipulated above. In that case, it shall be made available to the public at the  company's registered office in the Member State concerned. It must be possible to obtain a copy of all or part of  any such report on request. The price of such a copy must not exceed its administrative cost.2. Paragraph 1  shall also apply to the duly approved consolidated accounts, the consolidated annual reports and the reports by  the persons responsible for auditing the accounts.3. However, where a credit institution which has drawn up  annual accounts or consolidated accounts is not established as one of the types of company listed in Article 1 (1)  of Directive 78/660/EEC and is not required by its national law to publish the documents referred to in  paragraphs 1 and 2 of this Article as prescribed in Article 3 of Directive 68/151/EEC, it must at least make them  available to the public at its registered office or, in the absence of a registered office, at its principal place of  business. It must be possible to obtain copies of such documents on request. The prices of such copies must not  exceed their administrative cost.4. The annual accounts and consolidated accounts of a credit institution must  be published in every Member State in which that credit institution has branches within the meaning of the third  indent of Article 1 of Directive 77/780/EEC. Such Member States may require that those documents be  published in their official languages.5. The Member States shall provide for appropriate sanctions for failure to  comply with the publication rules referred to in this Article.SECTION 11AUDITINGArticle 45A Member  State need not apply Article 2 (1) (b) (iii) of Directive 84/253/EEC (2) to public savings banks where the  statutory auditing of the documents of those undertakings referred to in Article 1 (1) of that Directive is reserved  to an existing supervisory body for those savings banks at the time of the entry into force of this Directive and  where the person responsible complies at least with the conditions laid down in Article 3 to 9 of Directive  84/253/EEC.(2) OJ No L 126, 12.5.1984, p. 20.SECTION 12FINAL PROVISIONSArticle 46The  Contact Committee established in accordance with Article 52 of Directive 78/660/EEC shall, when meeting as  constituted appropriately, also have the following functions:(a) to facilitate, without prejudice to Articles 169  and 170 of the Treaty, harmonized application of this Directive through regular meetings dealing in particular  with practical problems arising in connection with its application;(b) to advise the Commission, if necessary, on  additions or amendments to this Directive.Article 471. The Member States shall bring into force the laws,  regulations and administrative provisions necessary for them to comply with this Directive by 31 December  1990. They shall forthwith inform the Commission thereof.2. A Member State may provide that the provisions  referred to in paragraph 1 shall first apply to annual accounts and consolidated accounts for financial years  beginning on 1 January 1993 or during the calendar year 1993.3. The Member States shall communicate to the  Commission the texts of the main provisions of national law which they adopt in the field governed by this  Directive.Article 48Five years the date referred to in Article 47 (2), the Council, acting on a proposal from the  Commission, shall examine and if need be revise all those provisions of this Directive which provide for Member  State options, together with Articles 2 (1), 27, 28 and 41, in the light of the experience acquired in applying this  Directive and in particular of the aims of greater transparency and harmonization of the provisions referred to by  this Directive.Article 49This Directive is addressed to the Member States.Done at Brussels, 8 December  1986.For the CouncilThe PresidentN. LAWSON