Guidance on exemption for auditing

According to § 135 in the Act on Annual Financial Statements, companies can submit annual accounts that have not been audited.

In order to do this, the company shall not have exceeded these limits in 2 successive financial years:

1. Balance sheet total DKK 0.75 million
2. Net result DKK 1.5 million
3. Average number of 12 employees during the financial year

It is also possible to register a new company without electing auditors, if it is estimated that the above limits will not be exceeded.
When a company wishes not to use auditors, the annual general meeting (not at an extraordinary general meeting) shall, according to §29, 2, 3 of the Act on Limited Liability Companies, resolve that the next annual account shall not be audited, see §135 in Act on Annual Financial Statements. Every annual general meeting thereafter shall decide whether or not to continue in this fashion.

The resolution to not use auditors shall every year be stated in the managagement’s report in the annual accounts, see §10a in Act on Annual Financial Statements.

Furthermore, the company’s articles of association shall be amended accordingly and the decision registered with the Authority.

This wording can be used in the articles of association:

Each annual general meeting resolves whether the company wants its annual accounts audited. The annual general meeting can choose not to have its annual accounts audited, if the Act on Annual Financial Statements permits. If the company wants its annual accounts audited, the company appoints an auditor. The auditor’s duty remains until the annual general meeting appoints another auditor, or chooses not to have the annual accounts audited.

This wording can be used in the annual account:

According to §10a in the Act on Annual Financial Statements, the company has chosen not to appoint an auditor for the financial year 20XX.