Accounting Act and ApS

A Danish limited liability company (ApS) is required to comply with the provisions of the Accounting Act. This Act sets out the general requirements for bookkeeping, including procedures for recording documents and keeping accounting records. These provisions apply to all companies in Denmark that are not subject to governmental or local authority control. Failure to comply with this obligation may result in requests for additional information from public authorities or reservations in the company’s annual accounts.

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The general principles of the Accounting Act impose certain requirements on bookkeeping. It is essential that accounting records are not destroyed or disposed of, and that recording and documentation is carried out as quickly as possible. All accounting entries must be supported by appropriate attachments. If accounting operations are performed in a currency other than Danish kroner, it is necessary to determine an appropriate exchange rate. The average exchange rate or that prevailing on the day of the transaction may be adopted. The Accounting Act also establishes guidelines for the preparation of the annual accounts, which vary depending on the accounting classification of the company.

The new Accounting Act, effective from the beginning of 2024, makes digital bookkeeping mandatory. This means that all companies will have to use digital accounting systems that meet certain requirements of the law. All accounting documents should contain basic information such as the date of issue, the amount, a description of the product/service, the sender and recipient (with their personal details and identification number), information on the amount of VAT and payment details, all of which must be stored digitally.

The new digital accounting rules will be phased in, depending on the classification of the business:
– 1 January 2024: publication by the Danish Business Authority of a review of registered accounting systems.
– 1 July 2024: Companies in accounting classifications B, C and D will be required to comply with the new requirements and keep their accounts digitally.
– Estimated year 2026: Companies in accounting classification A that achieve an annual net turnover of more than DKK 300,000 for two years in a row will have to keep their accounts via a digital accounting system.