There has long been a tradition of a statutory audit for all companies in Denmark. In recent years this requirement has been eased for all companies in accounting class B, which now have the option to choose a declaration on an extended audit review as an alternative.
An extended review is basically made with a review of the accounts in accordance with international standards with the following additional actions:
- Control of land registration to verify ownership of assets and information about obligations
- Obtain commitment confirmations from banks and other credit institutions to check balances, debt and guarantees
- Ask the company’s lawyer about ongoing lawsuits, legal proceedings, etc., to ensure that these are disclosed in the accounts
- Random sampling to ensure that reporting of tax, VAT and other taxes are made correctly and on time
An extended review can be particularly relevant for owner-managed companies, and we recommend that an extended review is considered as an alternative to the traditional audit. The right choice for an individual company will depend on several factors, including, for example, stakeholders, complexity and the company’s financial position.
If you are considering an extended review, we recommend that you contact Baker Tilly to discuss it in more detail.