Size of an enterprise

How to evaluate the size of an enterprise?

To evaluate the status of an enterprise one must take into account:

– the number of employees


– the annual turnover or the total annual balance sheet

The data regarding employment, net income and balance sum are taken from a closed financial year.

The number of employees responds to the number of annual work units (AWU), which is a number of employees working full time in a particular enterprise or on its behalf during the whole considered year.

The employment of staff that didn’t work through the period of a full year, who worked part time (no meter for how long period), or seasonal workers are counted as a fractional part of AWU.

If an enterprise crosses the employment or the financial threshold during the last year it will not influence the status of its size. The enterprise will keep its status as it was in the beginning of the year, unless this situation repeats itself two years in a row – then the status is changed.

Exceptionally when an enterprise with SME status is taken over by a large enterprise it loses its status on the day it was taken over, and the two financial years in a raw provided for the change will not be taken under account.


Category of enterprise Number of employees (AWU) Annual turnover (EUR)   The total annual balance sheet (EUR)
Large >250 > 50 mln or > 43 mln
Medium <250 ≤ 50 mln or ≤ 43 mln
Small <50 ≤ 10 mln or ≤ 10 mln
Micro <10 ≤ 2 mln or ≤ 2 mln


Besides the basic information about the enterprise, it should be checked whether the enterprise is independent or related (financially or by partners/shareholders person) to other entrepreneurs.

Independent enterprise, is an enterprise which is not linked with any other enterprise or possesses less than 25% of shares or vote power in that enterprise. In the case of an independent enterprise the information about the number of employees and financial data are taken only based on its own account books.

Partner enterprise – is an enterprise which possesses (alone or at least with one linked enterprise) at least 25% but no more than 50% of capital or vote power in another enterprise. In case of partner enterprise in addition to one’s own data one must add a percentage of employees (expressed in AWU) and financial data of all partners. This percentage reflects possessed proportional share in capital or votes (depending on which one is bigger).


If enterprise A has 33% shares of enterprise B then to evaluate the size of enterprise B we take 100% of AWU value and financial data of enterprise B and 33% of AWU value and financial data of enterprise A.

Linked enterprise is an enterprise which stays in one of the below relations:

  • The enterprise has the majority of vote power in another enterprise in the form of shareholder/stockholder or board member;
  • The enterprise has the right to elect or dismiss the majority of members in an administrative, managing or controlling organ of another enterprise;
  • The enterprise has the right to have dominative influence over another enterprise according to an agreement concluded with this enterprise or according to its statute or company agreement
  • The enterprise that is a shareholder/stockholder or board member of another enterprise solely controls according to an agreement with other shareholders/stockholders or board members of this enterprise the majority rights of shareholders/stockholders or board member in this enterprise.

In case of linked enterprise one should add to one’s own data a 100% of all linked enterprise’s data.


If enterprise A has 66% of shares in enterprise B then to evaluate the size of enterprise B we take 100% of AWU value and financial data of enterprise B and 100% of AWU value and financial data of enterprise A.

If at least 25% or more capital or vote power of an enterprise is controlled by a public entity then it is considered to be a large enterprise regardless of the level of employment or the financial data.

Besides connections of one enterprise with another one we should also determine whether there are any connections through any individuals. These connections are also considered when evaluating the size of an enterprise.

For example if one individual is the owner of two or more enterprises operating on the same or related markets – these enterprises must be recognized as linked, because through the person of one owner they can influence their activity e.g. by lending each other money, planning shared strategies, have shared markets etc.