The Government has decided to submit a proposal to the Council on Legislation regarding the abolition of the compulsory audit for approximately 250 000 private limited liability companies.
The Government proposes that only the enterprises which during each of the two most recent financial years fulfil more than one of these three criteria will need to have a qualified auditor
- An average number of employees of more than 3 people,
- A balance sheet total of more than 1,5 million Swedish kronor,
- An annual net turnover of more than 3 million Swedish kronor.
This may come true on 1 November 2010
The proposals are proposed to come into force on 1 November 2010. The new provisions may be applied as of the financial year starting after 31 October 2010.
The companies must decide on the shareholders' meeting to refrain from having an auditor and report this to Swedish Companies Registration Office for registration. In this case the articles of association must also be altered.
So far just a proposal
Please note that this is a proposal which the parliament must decide on and that the time of taking effect is a part of the proposal. We shall revert with further details regarding the reform after the consideration of the Council on Legislation and the reading of the parliament.
It remains to be seen how many companies do indeed refrain from having an auditor.
Shall make it easier for small companies
Through the reform the companies may choose audit in accordance with their own needs and the companies may lower their administrative costs by refraining from audit. The proposal from the Government can be seen as a step to making it easier for the small enterprises.