What are the accounting and bookkeeping obligations for Swiss companies (OR)?

Swiss accounting obligations under the Code of Obligations (Obligationenrecht, OR) were modernised in 2013 (effective 2015) and updated again with the 2023 company law reform. The rules create a tiered system based on company size.

Who must keep accounts All Swiss commercial entities must keep accounting records. This includes: - Every GmbH and AG regardless of size or activity level - Sole traders (Einzelunternehmen) with revenue above CHF 500,000 - Sole traders below CHF 500,000 may use simplified single-entry bookkeeping

For GmbHs and AGs, there is no simplified bookkeeping option — double-entry is mandatory from day one.

Content of the annual accounts For standard-sized companies (below the size thresholds), annual accounts must include:

• Income statement (Erfolgsrechnung or Gewinn- und Verlustrechnung): shows revenues, costs, and net profit/loss for the financial year

• Balance sheet (Bilanz): shows assets and liabilities/equity at year end

• Notes (Anhang): discloses accounting policies, details of fixed assets and their depreciation, information about long-term liabilities, significant related-party transactions, number of full-time equivalent employees, executive salary disclosure (for mandatory audit companies), and other information required by the OR

Extended reporting for larger companies Entities exceeding two of three thresholds in two consecutive financial years must prepare: - Cash flow statement (Geldflussrechnung) - Management report (Lagebericht): discussion of business performance, outlook, and risk Thresholds: total assets CHF 20 million, annual revenue CHF 40 million, 250 full-time equivalent employees

Audit obligations Ordinary audit (ordentliche Revision) is required for companies: (a) with 250+ FTEs, (b) that are listed, (c) required to prepare consolidated accounts, or (d) where a shareholder holding 10%+ requests it. Companies requiring ordinary audit must use a licensed Revisionsexpertin.

Limited review (eingeschränkte Revision, ER) applies to GmbHs and AGs with fewer than 250 FTEs that are not subject to ordinary audit. A licensed Revisor must perform the limited review.

Opting-out: If a GmbH or AG has fewer than 10 full-time employees, all shareholders can unanimously waive the requirement for even a limited review (Opting-out nach Art. 727a OR). This is common for small founder-operated companies. Once any shareholder who waived it later requests a limited review, the company must comply.

Accounting standards Swiss companies may prepare accounts under: - OR accounting standards (Swiss GAAP light): minimum for non-public companies - Swiss GAAP FER: often chosen by non-listed companies seeking better comparability - IFRS: mandatory for SIX-listed companies, optional for others

Record retention All accounting records, supporting documents, annual accounts, and business correspondence must be retained for 10 years. This includes invoices, bank statements, contracts, and payroll records. Electronic records are acceptable if they can be produced in an authentic, readable format throughout the retention period.

Fiscal year The fiscal year is set in the company's articles of association (Statuten). Unlike in Germany, Switzerland does not require the fiscal year to follow the calendar year. A 30 June or 30 September year-end is common for businesses seeking to align with group reporting or to avoid the December AGM season.