What are annual accounts?

What is a year-end closing?

The year-end closing is the last step in the bookkeeping for a financial year. At this stage, everything needed to correctly reflect the year's income and expenses and the company's position on the balance sheet date is recorded, and the bookkeeping is summarised in an income statement and a balance sheet. The Swedish Bookkeeping Act (Bokföringslagen) calls these year-end transactions: entries that are necessary to determine the income and expenses for the financial year and the financial position on the balance sheet date.

The Swedish word bokslut is used both for annual accounts and for the year-end closing that forms the basis of an annual report. The work is largely the same. The difference lies in what has to be submitted afterwards and to whom. The form the year-end closing takes depends on the type of business, and this is where annual accounts and an annual report differ.

If you want to follow your results during the year, and not just at year-end, a monthly report with key figures is included in Premium. A year-end closing is also easier when the bookkeeping has been reconciled on an ongoing basis, because errors are then found while the supporting documents are still easy to get hold of.

Annual accounts or annual report?

Under the Bookkeeping Act, limited companies, economic associations and trading partnerships with a legal entity as a partner, among others, must close their books with an annual report. The same applies to larger companies. All other businesses close their books with annual accounts. This covers most sole traders and trading partnerships where all the partners are individuals.

Annual accounts consist of an income statement and a balance sheet. An annual report contains more, including a directors' report and notes, and is submitted to the Swedish Companies Registration Office (Bolagsverket). Read more on our page about the annual report.

Simplified annual accounts for small businesses

A business whose annual net turnover is normally no more than SEK 3 million, and which is not required to prepare an annual report, may prepare its annual accounts in simplified form. Simplified annual accounts also consist of an income statement and a balance sheet, but with fewer requirements. The Swedish Tax Agency (Skatteverket) has an e-service for simplified annual accounts for businesses with a turnover of no more than SEK 3 million.

Year-end closing for a sole trader

For a sole trader (enskild firma), the annual accounts form the basis of the income tax return. The profit is declared in an NE appendix (NE-bilaga), which is submitted together with your income tax return. The Tax Agency states that you must sign the annual accounts and keep them for seven years, but you do not need to submit them. We do the year-end closing, fill in the NE appendix and go through it with you before it is submitted.

Year-end closing for a trading partnership

A trading partnership (handelsbolag) files its tax return on Income Tax Return 4 (Inkomstdeklaration 4), with the appendices for the accounts schedule, tax adjustments and partner details. Partners who are individuals submit appendix N3A with their own tax return. The partnership's financial year determines when the tax return is due.

Year-end closing for a limited company

A limited company (aktiebolag, AB) prepares a year-end closing as the basis for the annual report and for Income Tax Return 2 (Inkomstdeklaration 2). The year-end work is the same as for other types of business, but the result then goes into the annual report and must be adopted at the annual general meeting. If you own the company, we also help you with the K10 form and your personal tax return.

When must the annual accounts be completed?

The Bookkeeping Act states that the annual accounts must be completed as soon as possible, and no later than six months after the end of the financial year. In practice, the tax return sets the pace: the year-end closing must be finished before the income tax return can be submitted.

What does the year-end closing include?

• Reconciliations. Bank, tax account, accounts receivable, accounts payable, VAT and payroll accounts are reconciled against supporting documents so that the balance sheet shows the correct amounts.
• Accruals. Income and expenses are allocated to the correct year, for example prepaid rent and accrued expenses. Read more about accruals.
• Depreciation. Equipment and other fixed assets are depreciated over their useful life, see depreciation.
• Stock. Stock is counted and valued on the balance sheet date. If you hold stock, we need your stocktake for the result to be correct.
• Equity and drawings. For a sole trader or a trading partnership, the owner's own contributions and drawings are reconciled so that the equity is correct.
• Tax. We calculate the tax for the year and the tax adjustments for the tax return.

How the year-end closing works with us

1. We go through the year. The ongoing bookkeeping must be complete. If we already handle it, we can start straight away.
2. You provide the information only you know. Stocktake, doubtful receivables, larger purchases and private drawings.
3. We reconcile the accounts and post the year-end entries. Accruals, depreciation, stock and tax.
4. You receive the year-end accounts and the tax return to review. We go through the result and what it means for your tax.
5. You sign and we submit. The tax return to the Tax Agency and, for limited companies, the annual report to the Companies Registration Office.

Price for a year-end closing

The year-end closing is included in Complete and Premium. As a stand-alone assignment, the year-end closing and income tax return cost from SEK 2 500 for a sole trader, from SEK 4 500 for a trading partnership and from SEK 7 500 for a limited company, excluding VAT. If you need help with tax ahead of the year-end closing, see tax advice.

Fixed monthly price based on the number of transactions and employees, no lock-in period, three months' notice. See prices.