Being a business or company owner involves a lot of tasks. And we know from experience that one of the tasks most people just want to get over with is the annual report.

It can feel overwhelming, confusing, and intimidating. What if you overlook something, make a mistake, or enter the wrong figures? Will the tax authorities come after me? Yes, for many, the annual report is a source of sleepless nights and new gray hairs.

We understand. That is why we have written this blog post to help you better understand how to successfully complete your annual report.

What is an annual report for reporting classes A and B?

An annual report for reporting classes A and B provides a comprehensive and accurate insight into your company's finances for the past year. The report is used by both you and your stakeholders. For companies in reporting class B, the Danish Business Authority must also have access to your annual report.

Regardless of whether you are in reporting class A or B, the annual report is an essential part of running a business or company.

There are two reasons for this:

The first reason is that the annual report gives you an overview of how your company's finances have performed over the past year. In the annual report, you must state income, expenses, assets, cash flows, etc., which allows you to see whether your business is profitable or operating at a loss.

The second reason is that for the vast majority of business types, it is a requirement to prepare an annual report based on your financial statements. If you have a sole proprietorship in reporting class A, you are not required to submit an annual report to the public authorities.

However, it is generally a necessity. First and foremost, because you may be asked to present your annual report to your bank, creditors, or other stakeholders who expect a report prepared according to standard accounting principles.

Furthermore, the annual report is a necessity because you need the figures from it for your tax return.

You can read more about the annual report for companies in reporting class A here.

If you own a company in reporting class B, you are required to prepare and submit a formal annual report to the Danish Business Authority every year that meets the requirements for companies in reporting class B. Read more about requirements for annual reports for ApS here.

What must an annual report for reporting classes A and B contain?

Beyond the fact that bookkeeping is an essential part of preparing your annual report, there are, as previously mentioned, certain rules and requirements for your annual report that must be met. These rules and requirements depend on which reporting class your business or company belongs to.

Common to both reporting classes A and B is that the following must be included in the annual report:

• Statement by management
• Accounting policies
• Income statement
• Balance sheet
• Notes

You can read more about the requirements from the Danish Business Authority here.

So, how do you prepare the annual report?

Even though it is largely your responsibility to ensure that the annual report is complete and accurate, there is certainly nothing wrong with getting a little outside help. Just as you are perfectly entitled to choose to do it yourself. When it comes to preparing the annual report, you and only you know best how it should be done.
However, we see many who are unsure about what options are available for preparing the annual report.

And we can certainly understand that. Because there are several ways you can complete your annual report, and as mentioned, it is entirely up to you which of the methods below you choose to use.

1.     Do it yourself

The first method is suitable for those who believe they have a complete grasp of all rules and requirements and also have a full overview of their bookkeeping.

Doing it all yourself is obviously the cheapest solution, but it is also a solution where we see many run out of steam. Because there is a great deal you need to stay on top of, which takes time, requires many resources, and can lead to many sleepless nights.

Therefore, many also view this method as the most high-risk. Because the risk of overlooking or forgetting a figure, a calculation, or misunderstanding a rule is high. Which, in the end, can have consequences for both you and your company.

2.     Get help from an accountant

Getting help from an accountant is probably the most well-known solution. For many, it is also the easiest, because an accountant gives you the opportunity to have a professional prepare your annual report. But, and there is always a but – it is also an expensive and relatively resource-intensive solution.

First and foremost, because it costs a lot of money to have an accountant prepare your annual report.
Furthermore, an accountant needs to be familiar with your company's finances before they can prepare the annual report, which means you must have a good overview of your final bookkeeping yourself beforehand.
And last but not least, you risk having to wait for your annual report, as an accountant typically has many other clients to manage.  

3.     Become your own accountant with help from Reportability

Yes, it’s true. You can actually become your own accountant without getting a degree or having to spend countless resources worrying about rules, calculations, and numbers.

At Reportability, we have an online tool that guides you through 5 simple steps to complete your annual report, whether your business/company falls under reporting class A or B.

It takes no more than 30 minutes from the time you start until you have a finished annual report and a complete overview of the figures you need to enter into your tax return.

Along the way, the tool ensures that the legal rules and requirements for reporting class A or B are met, while also ensuring that you enter your figures correctly and comprehensively for the Danish Business Authority and the Danish Tax Agency.

And should you have any questions or be in doubt about anything, our skilled accountants are ready to help you via chat or phone.

Does this solution sound like something for you?

Then you can create a free profile here and get started right now with preparing the annual report for your company in reporting class A or B.