What does a limited statutory audit deliver?
A limited statutory audit is more than a legal formality. Conducted rigorously, it provides real value to the company and its stakeholders:
- Reliable accounts, shareholders, the board of directors and management have independent assurance on the accuracy and regularity of the financial statements.
- External credibility, audited accounts strengthen the company's position with banks, business partners and tax authorities.
- Fresh perspective on processes, the auditor can identify anomalies, internal control weaknesses or areas for improvement in the accounting function.
- Protection for minority shareholders, an independent audit body provides a safeguard for all shareholders, particularly in companies with multiple stakeholders.
According to EXPERTsuisse, approximately 80,000 Swiss companies have their annual accounts reviewed under a limited statutory audit each year — it is the standard audit for Swiss SMEs.
Which companies are subject to the limited statutory audit?
Under Art. 727 CO, companies exceeding two of the following three thresholds in two consecutive financial years are subject to the full (ordinary) statutory audit:
• Balance sheet total: CHF 20 million
• Net revenue: CHF 40 million
• Average headcount: 250 full-time equivalents
All companies below these thresholds, the vast majority of Swiss SAs and Sarls, are subject to the limited statutory audit under Art. 727a para. 1 CO, unless they qualify to waive this requirement (opting-out).
Opting out, waiving the audit requirement
A company may waive the limited statutory audit (opting out) if two conditions are met simultaneously (Art. 727a para. 2 CO):
- The company employs fewer than 10 full-time equivalents on average during the financial year.
- All shareholders or members unanimously consent to the waiver.
This option is common in micro-enterprises and family-owned companies. It is not without trade-offs: the absence of an audit can undermine the credibility of the accounts and complicate access to bank financing.
Important: following the revision of Swiss corporate law that came into force on 1 January 2023, a company that has opted out must submit its most recent annual accounts to a limited statutory audit if those accounts show a loss of half of the share capital (Art. 725a para. 2 CO). Opting out therefore does not fully suspend the audit requirement in situations of financial distress.
Opting up, requesting a full statutory audit
Conversely, shareholders representing at least 10% of the share capital may request a full (ordinary) statutory audit even if the company does not legally require one (Art. 727 para. 2 CO).
This mechanism, known as opting up, is designed to strengthen transparency and protect minority shareholders where the stakes justify it.
How does a limited statutory audit work at DHAC?
Our approach is straightforward and avoids unnecessary administrative burden:
- Engagement letter, we formalise our independence and the scope of the engagement.
- Document access, annual accounts, general ledger, bank statements, board and shareholder meeting minutes, tax returns.
- Audit procedures, management interviews, analytical procedures and sample-based testing in accordance with the Swiss Standard on Limited Statutory Audit (SAS/NCR).
- Audit report, we issue the statutory report addressed to the general meeting, including the audit opinion on the annual accounts and our position on the board's proposed appropriation of profit.