Your French company is growing, and that is good news. It also triggers a duty that many foreign founders discover too late: once the business exceeds certain size thresholds, French law requires it to appoint a statutory auditor, known in France as a commissaire aux comptes (CAC). This is not an optional adviser. It is an independent officer imposed by the Commercial Code, with a six-year mandate, whose absence can void the resolutions of your shareholders’ meetings and expose the company’s officers to criminal fines. The appointment, the filing with the authorities and the yearly audit cycle can all be handled while you live abroad, but only if you understand the calendar: the duty starts the year after you cross the thresholds, and the auditor must already be in place when the shareholders approve the accounts. This guide explains, for a foreign founder or foreign group running a French société par actions simplifiée (SAS, the flexible joint-stock company most foreigners choose) or a société à responsabilité limitée (SARL, the private limited company), when the auditor becomes mandatory, the three alternative routes that can force an appointment even below the thresholds, how to appoint and register the auditor from abroad, and what a missing auditor costs in court.

I. When your French company must appoint a statutory auditor

A. The two-out-of-three test: balance sheet, turnover and headcount that force the appointment

French law does not require every company to have a statutory auditor. It requires one once the company reaches a certain size, measured at the close of a financial year (exercice social) on three criteria: total balance sheet (total du bilan, the sum of all assets), net turnover excluding VAT (chiffre d’affaires hors taxes), and average headcount during the year (nombre moyen de salariés). Exceeding two of the three thresholds makes the appointment compulsory.

For a SAS, the rule sits in article L227-9-1 of the Commercial Code: “Sont tenues de désigner au moins un commissaire aux comptes les sociétés par actions simplifiées qui dépassent, à la clôture d’un exercice social, deux des seuils suivants, fixés par décret : le total de leur bilan, le montant de leur chiffre d’affaires hors taxe ou le nombre moyen de leurs salariés au cours de l’exercice.” For a SARL, article L223-35 of the Commercial Code uses the same architecture: “Sont tenues de désigner un commissaire aux comptes au moins les sociétés à responsabilité limitée qui dépassent à la clôture d’un exercice social des chiffres fixés par décret pour deux des critères suivants : le total de leur bilan, le montant hors taxes de leur chiffre d’affaires ou le nombre moyen de leurs salariés au cours d’un exercice.” Partnerships limited by shares apply the equivalent rule in article L226-6 of the Commercial Code: “Sont tenues de désigner au moins un commissaire aux comptes les sociétés qui dépassent, à la clôture d’un exercice social, les seuils fixés par décret pour deux des trois critères suivants : le total de leur bilan, le montant de leur chiffre d’affaires hors taxes ou le nombre moyen de leurs salariés au cours de l’exercice.”

The figures themselves are fixed by regulation, and foreign founders should note that they have moved since the 2019 PACTE reform (decree n° 2019-514 of 24 May 2019). The official guidance on service-public.fr, as read on 12 October 2026, now states the test as follows. the appointment of a statutory auditor becomes mandatory once 2 of the 3 following thresholds are crossed: a balance-sheet total (the sum of all assets) of EUR 5,000,000, turnover excluding VAT of EUR 10,000,000, and 50 employees. In plain terms: a balance-sheet total of five million euros, turnover excluding VAT of ten million euros, fifty employees on average. Cross any two, and the auditor becomes mandatory. A company with nine million euros of turnover, four million of balance sheet total and sixty employees crosses two thresholds. A company with twelve million of turnover but only three million of balance sheet and twenty employees crosses only one, and escapes the automatic duty, though other routes described below can still apply.

Two timing rules soften the landing, and both matter for a founder managing the company from abroad. First, the obligation does not bite for the year in which the thresholds are crossed. The same official guidance states: where the thresholds are crossed, the company is not required to have the accounts of that same year audited; the duty takes effect from the following financial year. If your company crosses two thresholds at the close of the 2026 year, the auditor must be appointed to audit the 2027 accounts, which means the appointment decision should be taken during 2027, before the shareholders’ meeting that approves those accounts. Second, the exit is symmetric but slower: the company is no longer required to appoint an auditor where it has stayed below the thresholds at the close of the two financial years preceding the expiry of the auditor’s mandate. If the company falls back below the thresholds, it may decline to renew the auditor only at the end of the mandate, assessed over the two preceding years. And once appointed, the auditor stays: the auditor must stay in office for the full duration of the mandate, even if the company stops meeting the mandatory-appointment conditions shortly after the appointment. A shrinking year does not cut a running mandate short.

Groups add a further layer. Companies that must prepare consolidated accounts (comptes consolidés, the combined accounts of a parent and its subsidiaries) must appoint two statutory auditors, independent of each other, meaning they may not belong to the same audit firm. A foreign group that builds a French sub-group, or a French holding company with several operating subsidiaries, should check this duty early, because the two-auditor rule applies regardless of the size thresholds of each individual subsidiary. The tax administration’s professional guidance also summarises these duties (see impots.gouv.fr on when a CAC is required and the economie.gouv.fr overview), and the figures and procedures below follow the official sources cited in this article.

B. The three other routes to a mandatory auditor you never voted for

Crossing the thresholds is the main route, but three other mechanisms can force a statutory auditor onto a company that stays below them. Each one has a distinct logic, and a foreign founder who ignores minority shareholders or contractual audit clauses can be surprised by all three.

The first is the court appointment at the request of a minority. For the SARL, “Même si ces seuils ne sont pas atteints, la nomination d’un commissaire aux comptes peut être demandée en justice par un ou plusieurs associés représentant au moins le dixième du capital.” as both article L227-9-1 for the SAS and article L223-35 for the SARL provide. Ten percent of the capital is enough to petition the court. The judge has discretion to grant or refuse, and the official guidance confirms that one or more shareholders holding at least 10% of the capital may petition the court to appoint an auditor, and the judge is free to grant or refuse the request. In practice, a falling-out with a minority shareholder, an unpaid seller holding part of the capital, or a foreign co-founder who suspects the accounts are opaque can each produce a court-appointed auditor. The appointment then runs its full course even if the majority would never have voted for it.

The second is the motivated request of one-third of the capital, which produces a shorter three-year mandate. Both articles provide (article L223-35): “Sont également tenues de désigner un commissaire aux comptes, pour un mandat de trois exercices, les sociétés dont un ou plusieurs associés représentant au moins le tiers du capital en font la demande motivée auprès de la société.” No judge is needed here: a reasoned written request from holders of at least one-third of the capital obliges the company to appoint an auditor for three financial years. This mechanism, introduced to give significant minorities an audit right without going to court, is the one foreign founders meet most often after a fundraising round, when an incoming investor holding a blocking minority sends the reasoned request as a condition of its investment. The mandate is limited to three years rather than six, and the auditor’s procedures are proportionate to a small company, but the appointment itself is compulsory once the request is made.

The third is the voluntary appointment, which is a strategic choice rather than a constraint. “Un CAC peut aussi être désigné volontairement,” including for a limited three-year mandate in a small company. Lenders, public grant bodies, landlords signing a large commercial lease, or a future buyer in a sale process often ask for audited accounts even when the law does not require them. Appointing an auditor voluntarily for three years can unblock financing or reassure a partner, and the lighter three-year regime keeps the cost proportionate. The trap is to treat a voluntary auditor as a lighter commitment: once appointed, the auditor has the same independence, the same powers of investigation and the same duty to report irregularities as a mandatory one, and removing the auditor mid-mandate is tightly controlled. A voluntary appointment should therefore be decided with the same seriousness as a compulsory one, with the duration, the fee scale and the reporting calendar set in writing before the shareholders vote.

II. Appointing, filing and working with the auditor from abroad

A. How to appoint the auditor and file the appointment without flying to France

The appointment itself is a shareholder decision, and the procedure differs slightly between a SAS and a SARL. In a SAS, the official guidance states: the auditor is appointed by collective decision of the shareholders, on a proposal from the president or another management body. In practice, the president (président, the legal representative of a SAS) or the management body designated by the articles (statuts) proposes a candidate, and the shareholders adopt the appointment by collective decision, in the forms the articles allow: physical meeting, written consultation, or videoconference and electronic vote if the articles permit. In a SARL, the auditor is appointed at the ordinary general meeting, the ordinary general meeting of shareholders. A foreign founder who is the sole shareholder of a SASU (single-member SAS) or EURL (single-member SARL) simply records the decision in writing; distance changes nothing, but the written record must exist, be dated and be kept with the company’s registers (registres sociaux).

Only a qualified professional may be appointed. The auditor must be registered on the official list of statutory auditors, and the company should verify the registration before the vote, because appointing an unregistered person produces an irregular designation with the consequences described in the next section. The proposal should name the individual or firm precisely, state the duration of the mandate (six financial years as a rule, three in the cases allowing it), and record the starting year. The standard mandate lasts six financial years: the Court of Cassation recalls that “Selon l’article L. 823-3 du code de commerce, le commissaire aux comptes est nommé pour un mandat de six exercices et le commissaire aux comptes nommé en remplacement d’un autre demeure en fonction jusqu’à l’expiration du mandat de son prédécesseur” (Commercial Chamber, 10 May 2024, n° 22-16.158). Six years is long, and it structures the relationship: fees, planning of interim work, and the auditor’s independence must be assessed over that horizon, not year by year.

The 2024 ruling carries a second lesson that matters whenever an auditor resigns mid-mandate. Eleven simplified joint-stock companies had appointed auditors before the PACTE thresholds took effect; the auditors then resigned, and the companies argued that the resignation ended the mandate so that the new, higher thresholds applied to any replacement. The Court rejected the argument: “la durée légale du mandat d’un commissaire aux comptes est de six exercices […] cette durée ne peut être affectée par sa démission en cours de mandat, un nouveau commissaire aux comptes devant, dans une telle hypothèse, être désigné pour la durée du mandat restant à courir” (Commercial Chamber, 10 May 2024, n° 22-16.158). A resignation does not terminate the office; a replacement must be appointed for the remainder of the running mandate. For a founder abroad, the message is practical: if your auditor resigns, you do not get a holiday from audit. You must appoint a successor quickly, for the remaining years, and file that appointment the same way.

Filing is the step foreign founders most often miss. The appointment must be published and registered so that third parties, the court registry (greffe du tribunal de commerce, the clerk’s office keeping the trade register) and the national company register (registre national des entreprises) know who audits the company. Since 2023, business formalities go through the single online portal, the guichet unique des formalités d’entreprises operated by the Institut national de la propriété industrielle (INPI, the French intellectual-property and business-formalities office): a change of auditor is filed as a company modification with the minutes of the appointing decision attached (see the INPI guidance on modifying a company). The registry then updates the company’s entry in the trade and companies register (registre du commerce et des sociétés, RCS). The 2024 case itself grew out of a registry refusal to record the auditors’ departure without a replacement, which shows how seriously the registry takes the continuity of the office. Keep the filing receipt (récépissé de dépôt), check that the updated company record (extrait Kbis, the official identity card of a French company) reflects the auditor, and keep the minutes available: banks, investors and future buyers all ask for them.

Once in office, the auditor works to a yearly cycle that the founder must feed from abroad. The auditor must be convened to the shareholders’ meeting that approves the accounts, receives the financial statements and the management report before the meeting, issues a report on the annual accounts, and reports any irregularities. Concretely, the founder’s calendar should include: closing the accounts with the accountant (expert-comptable) on time, sending the full file to the auditor early enough for the audit to be real rather than rushed, convening the auditor to the approval meeting, filing the approved accounts with the registry within the statutory deadlines, and paying the auditor’s fees as agreed. None of this requires physical presence in France: decisions can be signed electronically, meetings held by videoconference where the articles allow, and filings made online. What it requires is anticipation, because an auditor who receives the accounts the day before the meeting cannot certify them, and a missed filing deadline for the accounts carries its own fines, as explained in our guide to missed annual accounts filings. Founders setting up their first French company will also find the broader incorporation sequence, from bank account to Kbis to VAT, in our foreign-founder setup guide.

B. What a missing auditor costs: void resolutions and criminal fines

The sanctions for operating without a required auditor are severe, and they strike on two levels: the validity of shareholder decisions in civil court, and the personal criminal liability of officers.

On the civil level, shareholder meeting resolutions adopted without a properly appointed auditor can be annulled. In a widely noted ruling, the Commercial Chamber of the Court of Cassation held: “Selon l’article L. 820-3-1 du code de commerce applicable en Nouvelle-Calédonie, dans les personnes morales dotées d’une assemblée générale ordinaire, les délibérations de cette instance prises à défaut de désignation régulière de commissaires aux comptes, sont nulles” (Commercial Chamber, 21 June 2023, n° 21-19.985). The facts show how far the rule reaches: a manager had been removed by an ordinary general meeting, and the removed manager obtained the annulment of the removal on the sole ground that the company’s auditors had not been regularly designated. The Court added two points of principle. First, the nullity rule “déroge, dans le domaine qu’il régit, à celle édictée à l’article L. 235-1 de ce code” and “est d’ordre public et s’applique peu important que la désignation du commissaire aux comptes soit volontaire ou imposée par la loi ou les statuts.” Public order (ordre public) means the parties cannot contract around it, and it applies whether the auditor was required by law or simply provided for in the articles. Second, the nullity covers every resolution of the ordinary meeting: “ce texte visant les délibérations de l’assemblée générale ordinaire sans distinguer selon leur objet, il en résulte que la nullité qu’il prévoit s’applique à toutes les délibérations des assemblées générales ordinaires, qu’elles doivent ou non figurer dans le rapport du commissaire aux comptes sur les comptes annuels.” A removal of a manager, an approval of accounts, a distribution of dividends: any of them can fall if the auditor’s designation was irregular when the meeting voted.

For a foreign founder, the practical exposure is immediate. Imagine a dispute with a minority shareholder or a removed manager: the opponent asks the court to annul the meeting that approved the accounts, voted the dividend, or revoked the manager, arguing that no auditor, or an irregularly appointed auditor, sat when the meeting deliberated. If the company was under a duty to have an auditor and had none, or if the appointment suffered from a defect (unregistered auditor, expired mandate never renewed, appointment never filed), the annulment can succeed years later, unwinding dividends paid, accounts approved and managers removed. The defence that the defect was a mere oversight, or that the articles did not require an auditor, does not help where the law imposed one, and the public-order character of the rule means even a unanimous shareholder vote cannot cure the absence after the fact. The only safe position is a regularly designated auditor, in office and convened, at the date of each ordinary meeting.

On the criminal level, the officers face imprisonment and fines. The official guidance is blunt: failure to appoint a mandatory auditor is punishable by 2 years’ imprisonment and a EUR 30,000 fine. Two years’ imprisonment and a thirty-thousand-euro fine: that is the maximum incurred for failing to appoint a mandatory auditor. Prosecutions remain rare against small companies, but the provision gives minority shareholders, new investors and public creditors a formidable lever, and it colours every negotiation once the breach is known. Beyond the courts, the commercial consequences accumulate quietly: the registry can refuse filings connected to an irregular audit situation, banks calibrating a loan and buyers conducting due diligence treat missing audit reports as a red flag, and public subsidy bodies may suspend payment while the accounts are uncertified. None of these actors needs a court order to make the missing auditor expensive.

The remedy, once the gap is identified, follows a clear order. First, measure the thresholds at the last two closes with the accountant, on the current official figures, and determine whether the duty started this year or earlier. Second, select a registered auditor, negotiate a six-year (or three-year, where allowed) engagement letter, and have the shareholders appoint the auditor by the proper decision, before the next accounts-approval meeting. Third, file the appointment on the single formalities portal and verify the updated company record. Fourth, give the auditor the back file: prior-year accounts, management reports, minutes of the meetings held without an auditor, and the bank and tax correspondence, so the first report rests on complete information. Fifth, rebuild the meeting calendar so that every future ordinary meeting is convened with the auditor and every approval cycle closes with filed, certified accounts. Where past meetings are already tainted, have counsel assess whether they should be re-held once the auditor is regularly in place, because a fresh, regular vote is often cheaper than defending an annulment action. A company that crosses the thresholds while its founder lives abroad does not need to relocate to comply; it needs a competent accountant, a registered auditor, written decisions, and filings made on time.

Conclusion

A growing French company run from abroad reaches a point where success itself creates a legal duty: two thresholds crossed out of balance sheet total, turnover excluding VAT and headcount, and a statutory auditor must be appointed, for six financial years, starting with the following year’s accounts. Minority shareholders holding one-tenth of the capital can ask a court to impose one, holders of one-third can demand one for three years by reasoned request, and groups preparing consolidated accounts need two. The appointment is a shareholder decision, the mandate survives the auditor’s resignation (Commercial Chamber, 10 May 2024, n° 22-16.158), the filing goes through the single online portal, and the auditor must be convened to every accounts-approval meeting. Without a regularly designated auditor, ordinary meeting resolutions can be annulled as a matter of public order, and the officers face up to two years’ imprisonment and a thirty-thousand-euro fine. Measure the thresholds at each close, appoint before the next approval meeting, file the appointment, and feed the auditor on time: handled from abroad with discipline, the audit duty becomes routine governance rather than a crisis.