Every Swiss GmbH and AG must maintain proper bookkeeping and prepare annual financial statements — even if the company is dormant with no revenue. Financial statements are due within six months of the financial year-end, are not publicly filed, and are subject to audit requirements that depend on company size. This guide covers the full scope of Swiss accounting obligations.
Legal Basis for Swiss Accounting Requirements
Swiss company accounting is governed primarily by the Code of Obligations (OR/CO), Articles 957 to 963b, which were revised as part of the Swiss accounting law reform effective 2015.
The key obligation, set out in Article 957 CO, is that all companies entered in the Commercial Register must maintain proper bookkeeping and prepare annual financial statements. This applies without exception — a newly formed company with no revenue, a dormant holding company, and an actively trading SME all face the same statutory obligation.
Companies that do not exceed CHF 500,000 in total annual revenue may apply simplified accounting rules (single-entry bookkeeping; no balance sheet required — only income and expenditure accounts plus an asset register). In practice, most GmbHs and AGs maintain full double-entry bookkeeping from the outset.
What Financial Statements Are Required
For standard Swiss companies, the annual financial statements must include:
1. Balance sheet (Bilanz)
A snapshot of assets, liabilities, and equity at the financial year-end. Swiss statutory accounts distinguish between current and non-current assets and liabilities, and between equity components (share capital, legal reserves, retained earnings).
2. Income statement (Erfolgsrechnung)
A summary of revenue, expenses, and net profit or loss for the year. Swiss companies may prepare the income statement by nature (Artengliederung) or by function (Funktionsgliederung).
3. Notes to the accounts
Disclosures required by the Code of Obligations, including accounting policies, significant balance sheet items, related party transactions, and contingent liabilities. The required note disclosures are less extensive than under IFRS for most Swiss SMEs.
For larger companies (exceeding the thresholds below):
- Annual report (Lagebericht) covering the business performance and risk situation
- Cash flow statement
- Statement of changes in equity
Most small to medium Swiss companies — including the majority of foreign-owned subsidiaries — are below the threshold for these additional requirements.
Audit Thresholds and Obligations
Switzerland applies a three-tier audit system:
Ordinary audit (ordentliche Revision)
Mandatory when a company exceeds two of three thresholds in two consecutive years:
| Criterion | Threshold |
|---|---|
| Balance sheet total | CHF 20,000,000 |
| Revenue | CHF 40,000,000 |
| Full-time employees | 250 |
An ordinary audit must be conducted by a licensed audit firm registered with the Federal Audit Oversight Authority (RAB).
Limited audit (eingeschränkte Revision)
Mandatory when a company exceeds two of three smaller thresholds in two consecutive years:
| Criterion | Threshold |
|---|---|
| Balance sheet total | CHF 10,000,000 |
| Revenue | CHF 20,000,000 |
| Full-time employees | 50 |
A limited audit can be conducted by any approved auditor, not necessarily a RAB-registered firm.
Audit waiver (Opting-out)
Companies below the limited audit thresholds can opt out of any audit if all shareholders unanimously agree (Article 727a CO). This is common for small, founder-owned companies and single-shareholder GmbHs. The waiver must be recorded in the articles or a separate shareholder resolution.
Most newly registered foreign-owned Swiss companies are well below the audit threshold and typically opt out. This reduces annual compliance costs by CHF 2,000–8,000.
Filing Deadlines
| Obligation | Deadline |
|---|---|
| Financial statements prepared | Within 6 months of financial year-end |
| Annual General Meeting (must approve accounts) | Within 6 months of financial year-end |
| Corporate tax return | Cantonal deadline; typically June–September of following year |
| VAT returns (if registered) | 60 days after quarter-end |
Financial year:
Swiss companies can choose any financial year-end, not just 31 December. However, most Swiss companies use 31 December as the year-end for simplicity.
Public filing:
Unlike Germany, the UK, or the EU, Switzerland does not require public filing of financial statements. Accounts are prepared, approved, and submitted to the tax authority — but are not registered in the Commercial Register and are not publicly accessible.
Accounting Standards
Swiss companies may use one of several accounting frameworks:
Swiss statutory rules (CO-based) — the default for SMEs and most foreign-owned subsidiaries. Less demanding than IFRS; no cash flow statement required for smaller companies; goodwill can be capitalised or written off directly to equity.
Swiss GAAP FER — a Swiss standard that provides more structure and comparability than bare CO rules while being less complex than IFRS. Used by companies seeking quality financial reporting without the full IFRS burden.
IFRS / IFRS for SMEs — required for listed companies; available for any company that wishes to use it. Provides international comparability, useful for companies with foreign parent companies that report under IFRS.
US GAAP — rare in practice; permitted for companies with US parent companies that file with the SEC.
For most small to medium Swiss GmbHs and AGs owned by foreign investors, CO-based accounting with Swiss GAAP FER is the standard recommendation.
Bookkeeping Records and Retention
Swiss law requires proper bookkeeping records to support the financial statements. This means:
- Double-entry bookkeeping (for companies above CHF 500,000 annual revenue)
- All transactions recorded in a systematic ledger
- Supporting documents (invoices, bank statements, contracts, receipts) retained for each entry
Retention period: 10 years for accounting records and supporting documents (Article 958f CO). The clock starts from the end of the financial year to which the records relate.
Records must be kept in a form that is accessible and reproducible. Electronic archiving is permitted — PDFs and scanned documents are acceptable, provided the archive is tamper-proof and backups exist.
Penalties for Non-Compliance
Failure to maintain proper accounting:
Under Article 166 of the Swiss Penal Code, intentional failure to maintain proper bookkeeping carries a custodial sentence of up to three years or a monetary penalty. Negligent non-compliance carries a lighter penalty.
Late filing of tax returns:
The cantonal tax authorities impose late filing fees and estimate taxable income from available information if the return is not filed on time. Estimated assessments are typically unfavourable to the taxpayer.
Failure to hold the annual general meeting:
Every Swiss company must hold at least one AGM per year to approve the accounts and discharge the directors. Failure to hold the AGM is a breach of corporate law, which can — in egregious cases — lead to dissolution proceedings.
In practice, the most common compliance failure for small foreign-owned Swiss companies is simple: the accounts are prepared late, or not at all, because the foreign owner assumed the company did not need annual reporting. Swiss law allows no such exemption.
Next Steps
Morgan Hartley Consulting provides accounting, bookkeeping, and corporate tax services for Swiss GmbHs and AGs from Baarerstrasse 135, 6300 Zug. We prepare annual financial statements, manage tax filings, and advise on audit obligations.
Request a Free Assessment to discuss your company’s accounting requirements.
- Phone: +41 44 51 52 592
- Email: info@lawsupport.ch
- Address: Baarerstrasse 135, 6300 Zug, Switzerland
For the corporate tax picture, see our guide to corporate tax in Switzerland. For VAT obligations, see our Swiss VAT registration guide.
Morgan Hartley Consulting | Baarerstrasse 135, 6300 Zug | +41 44 51 52 592 | info@lawsupport.ch