Accounting

The term “financial statements” covers a wide range of very different reports based on historical information – ranging from standard annual financial statements and interim reports to grant and project accounts, CSR reporting, and other statements with specific purposes.

As auditors, we are experts in preparing all types of financial statements and similar reporting – whether the financial statements are to be prepared in accordance with the Danish Financial Statements Act, special legislation (such as that applicable to museums or housing cooperatives), or other specific accounting criteria typically defined by grant providers, lenders, or other stakeholders.

This also means that we are experts in preparing tax accounts for companies, taxable organisations and individuals, as well as for sole proprietorships – including handling the Danish business tax scheme (virksomhedsskatteordningen).

Financial statements and tax accounts submitted to public authorities such as the Danish Business Authority and the Danish Tax Agency must be reported in the specific XBRL format, which we of course also manage.

In most cases, it pays off to have us prepare your financial statements, as we have dedicated systems and tools that allow us to prepare statements quickly and with full assurance that they comply with legislation and applicable accounting criteria.

Do you represent a:

Public limited company (Aktieselskab)

Private limited company (Anpartsselskab)

Partnership limited by shares (Partnerselskab)

Limited partnership with limited liability for the owners (Kommanditselskab with limited liability)

General partnership with limited liability for the owners (Interessentskab with limited liability)

Sole proprietorship (Personligt drevet virksomhed)

Other organisations engaged in commercial activity (selling goods and services)

Etc., pursuant to the Danish Financial Statements Act (Årsregnskabsloven)

When does the Financial Statements Act Apply?

A project or grant account is prepared for a specific purpose and is, as a rule, not required to comply with the Danish Financial Statements Act. In most cases, the grant provider or similar party has set specific requirements for the financial statement format, which makes it incompatible with the structure outlined in the Danish Financial Statements Act. It is important to note that such a statement may only be used by the organisation itself and the grant provider (or similar party) who has requested the statement for that specific purpose. The statement may not be used for other purposes or disclosed to other parties. If the financial statement is to be shared with others – for example, a bank, members, or similar – an additional financial statement must be prepared that complies with the rules set out in the Danish Financial Statements Act.

What is a project or grant account?

Project and grant accounts are financial statements prepared for a specific purpose. The statement does not need to cover a twelve-month period but often follows the grant period. These accounts must be prepared in accordance with the purpose for which they are created and, in particular, based on the accounting criteria typically set by a grant provider or similar party. It is important to ensure – already before the project is initiated – that the accounting function is set up in a way that allows for generating the necessary information required in the project or grant account. The account may not be used for any party other than the grant provider – not even for a bank or similar – as doing so would subject it to the Danish Financial Statements Act.

Does the Financial Statements Act apply to my business?

As a general rule, privately owned businesses where the owner(s) have personal liability are not required to apply the Danish Financial Statements Act. This, however, does not apply to companies with limited liability. Still, the rule is that if the financial statements are to be used for purposes other than internal use – for example, when shared with banks, leasing companies, business partners, employees, etc. – the Danish Financial Statements Act must be applied in a simplified form (Class A). We recommend always applying the Danish Financial Statements Act, as it is impossible to predict when a financial statement might be required by a lender, potential investor, or others. The additional work involved in applying the Act is often negligible. What about my personal financial statement? A financial statement of one’s personal wealth does not need to follow the Danish Financial Statements Act. We often see such "personal financial statements" prepared according to tax rules, which unfortunately do not provide an overview of what has been earned, how income has been used, or what the true net worth is. We can assist in preparing such statements, where, for example, pensions are included, real estate and other assets are recorded at realistic values, and deferred tax is recognised – such as the tax obligations related to pensions or unrealised gains on securities, etc.

Accounting

Do you represent a:

When does the Financial Statements Act Apply?

What is a project or grant account?

Does the Financial Statements Act apply to my business?

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