Does your company belong to reporting class B?
An annual report serves as your company's financial overview and helps you and your stakeholders gain insight into the company's income and expenses.
However, not all Danish companies are required to file a formal annual report, which is why it is essential to know your reporting class.
There are four different reporting classes: A, B, C, and D, and it is the size of the company that determines which reporting class you belong to. This also determines the requirements for the company's financial statements. You can read more about this here.
If your company belongs to reporting class B, you can get an overview here on this page of what you need to be aware of when preparing your final annual report.
Who belongs to reporting class B?
Reporting class B is for small and medium-sized enterprises.
In general, companies with limited liability fall under reporting class B – which means that there is a requirement for you to file a less detailed annual report. Companies that fall under reporting class B can, for example, be:
- Public and private limited companies
- General partnerships and limited partnerships where all responsible participants are limited liability companies
- Commercial foundations
- Limited liability companies covered by the Act on Certain Commercial Enterprises, unless they are covered by reporting class A.
If your company belongs to reporting class B, there are, as explained above, a number of minimum requirements that must be included in your annual report.
Including:
- Statement by the management
- Management commentary
- Income statement
- Balance sheet
- Notes (staff costs)
- Auditor's report (if applicable)
If you are unsure whether your company falls under reporting class B, please do not hesitate to email or call us – we are here to simplify the process and guide you safely through the filing of your company's annual report.
Otherwise, you can find further information on the requirements for the content of the annual report here.
Key requirements
When is an audit required for reporting class B?
Many newly established companies in reporting class B state in their articles of association that they opt out of an audit.
The company is entitled to do so as long as it does not exceed two of the following thresholds for two consecutive years:
- A balance sheet total of DKK 4 million
- Net revenue of DKK 8 million
- An average of 12 full-time employees during the financial year
Using our online tool – regardless of whether you are subject to an audit or not – we can guide you through the process of preparing your annual report.
It is important to note that opting out of an audit is not the same as being exempt from submitting an annual report and filing tax returns. Opting out of an audit concerns whether an auditor can vouch for the figures in the annual report.
A balance sheet and an income statement are required for reporting class B
It is a requirement that your company in reporting class B prepares an annual report when the financial year ends.
This must, at a minimum, include an income statement and a balance sheet.
A statement by the management is required in reporting class B
Unless you are the sole member of the company's management, a statement by the management must be included.
This means that the management must declare that the financial statements have been prepared correctly in accordance with legislation.
If you are the only person listed as part of the management, the statement by the management is omitted.
You must include the current note requirements for reporting class B
There are certain areas that must be included in the final annual report under the notes section.
This could, for example, be information regarding staff costs. If your company falls under reporting class B, you must be able to account for the following staff costs:
- Wages and salaries
- Pensions
- Other social security costs
Micro-enterprises
Micro-enterprises also belong to reporting class B.
Your company in reporting class B can qualify as a micro-enterprise provided that the following thresholds are not exceeded:
- A balance sheet total of max. DKK 3.5 million.
- Net revenue of max. DKK 7 million.
- Maximum of 10 full-time employees on average during the financial year
(The size limits apply to financial years beginning on or after January 1, 2023. Source: The Danish Business Authority)
If your company falls into this category, there are certain exceptions when preparing your annual report.
For instance, you are not required to have your annual accounts audited, and the requirements for notes are also less stringent.
This makes it simpler for you as a small business owner to prepare an annual report.
Prepare your annual accounts with Reportability
At Reportability, we have the tool to help you in reporting classes A and B reach the finish line with your annual report easily and securely.
Simply follow 5 quick and easy steps to generate your annual report and file it with the Danish Business Authority and the Danish Tax Agency. Each step already accounts for current legislation, so you just need to fill in the fields.
On average, it takes our customers 30 minutes to generate their own annual report.
Video explanation
