Obligation to keep accounts

Essentially, every company in Switzerland must maintain accounting records. The legal basis for this is regulated in the Swiss Code of Obligations. There is a distinction between double-entry and single-entry bookkeeping. The obligation to keep books is linked to the economic size of a company and whether it is a legal entity.

Double-Entry Bookkeeping

According to Art. 957 para. 1 of the Code of Obligations, all legal entities as well as sole proprietorships with a turnover of at least CHF 500,000 are required to use double-entry bookkeeping. Double-entry bookkeeping means that an annual financial statement with balance sheet and income statement must be prepared.

Single-Entry Bookkeeping

Sole proprietorships that have generated less than CHF 500,000 in turnover, as well as associations and foundations that are not required to register in the commercial register, must use single-entry bookkeeping. Colloquially, this obligation is also called "cashbook accounting." It is only necessary to keep records of income, expenses, and the financial position of the business. It is advisable to maintain accounting records even with low turnover in order to keep an eye on the financial situation.