Spotlight on Danish accounting: What is Danish GAAP and how does it relate to IFRS?

For companies and investors operating in Denmark, financial reporting frameworks are central to compliance, transparency, and stakeholder trust. Danish entities often prepare their statements under Danish GAAP (the Danish Financial Statements Act), but international investors are typically more familiar with IFRS.

So how do these two frameworks compare? And in which cases would a company choose one reporting standard over the other?

What is Danish GAAP?

Danish GAAP is based on the Danish Financial Statements Act, which classifies companies into different reporting classes depending on size. This tiered approach allows flexibility and reduces the burden on smaller businesses.

Key features of Danish GAAP:

• Scaled disclosure requirements: Classes A to D ensure that the scope of reporting corresponds to company size.
• Cost principle focus: Historical cost is the dominant valuation method, with limited use of fair value.
• National emphasis: Rules are adapted to Denmark’s business structure and creditor environment.

IFRS in the Danish landscape

IFRS is required for all companies listed on Nasdaq Copenhagen in their consolidated financial statements. Non-listed companies may choose IFRS voluntarily, often to align reporting with global stakeholders or to increase transparency towards investors.

Danish GAAP vs IFRS – the key differences

1. Measurement basis
   • Danish GAAP: Primarily based on historical cost, though fair value is allowed for some financial instruments.
   • IFRS: Greater reliance on fair value, with detailed rules for recognition and measurement.
2. Goodwill and intangibles
   • Danish GAAP: Goodwill is amortised, usually over up to 10 years.
   • IFRS: Goodwill is not amortised; instead, annual impairment testing is required.
3. Revenue recognition
   • Danish GAAP: Revenue is generally recognised when earned, in line with prudence.
   • IFRS: Uses the five-step model in IFRS 15, providing a structured framework across all industries.
4. Deferred tax
   • Danish GAAP: Deferred tax is recognised but only where material; exemptions exist for smaller entities.
   • IFRS: Comprehensive recognition of deferred tax on all temporary differences.
5. Consolidation rules
   • Danish GAAP: Exemptions possible for smaller groups.
   • IFRS: Broader requirement based on control, with stricter rules on consolidation scope.

When to apply Danish GAAP or IFRS

• Danish GAAP suits:
  • Companies mainly operating in Denmark.
  • Organisations prioritising administrative simplicity.
  • Smaller companies where cost of compliance is a concern.
• IFRS is relevant if:
  • The company is listed in Copenhagen or other markets.
  • Attracting international investors is a priority.
  • Cross-border financing or acquisitions require reporting comparability.

How CtrlPrint can support

Choosing between Danish GAAP and IFRS is more than a compliance task — it shapes how your business is evaluated by stakeholders. For Danish companies aiming at international growth, or investors assessing Danish entities, clarity in reporting is business critical.

At CtrlPrint, we help organisations:

• Streamline reporting under both Danish GAAP and IFRS.
• Ensure consistency, accuracy, and transparency for diverse stakeholders.
• Provide collaborative platforms that make multi-standard reporting efficient and less resource-intensive.

By bridging national requirements with global frameworks, CtrlPrint empowers leaders to manage reporting with confidence and communicate results that inspire trust.

Request a demo of CtrlPrint

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