Final provision two of Law 31/2014 amends the Spanish Companies Act to improve corporate governance and additional provision three of Law 15/2010, on measures to combat late payment in commercial transactions, requiring all commercial companies to expressly disclose average payment terms to suppliers in the notes to the annual accounts. Also the Spanish Accounting and Auditing Institute (ICAC) is empowered to set the standards and calculation methods.
This resolution will be mandatory for all Spanish companies that prepare consolidated financial statements, although exclusively for companies based in Spain that are fully or proportionally consolidated.
As a result, the Spanish Accounting and Auditing Institute (ICAC) issued its resolution of 29 January 2016 establishing the methodology for calculating the average supplier payment period for 2015 and successive.
The average supplier payment period is calculated by applying the following formula:
Average payment period =
|Rate of paid operations * Total payments of the period + Rate of outstanding payment transactions * Total outstanding payments|
|Total payments of the period + Total outstanding payments|
Data Spanish companies in the Group for the year 2016 and 2015 are:
|Average period of payments to suppliers||55||46|
|Rate of paid operations||56||47|
|Rate of outstanding payment transactions||42||41|
|Amount €M||Amount €M|
|Total payments of the period||693.106||700.861|
|Total outstanding payments||168.775||140.174|