Glossary

An annual report (årsrapport) is a company's complete official financial reporting for a fiscal year — typically income statement, balance sheet, notes, and management review — filed with the Danish Business Authority and made public.

The net result (årets resultat) is the bottom line of the financial statements: the company's total profit or loss for the fiscal year after all costs, financial items, and tax have been deducted.

Fixed assets (anlægsaktiver) are assets intended for lasting use in the business — e.g. property, machinery, goodwill, software, and equity stakes in other companies. Their counterpart is current assets.

The balance sheet total (balancesum) is the sum of all the company's assets — and equally the sum of equity and liabilities, since the balance sheet balances by definition. It is used as a measure of company size.

Gross profit (bruttofortjeneste) is revenue minus the direct costs of delivering goods or services (e.g. cost of goods sold). For most small Danish companies, gross profit is the top line of the published financial statements, because revenue may be omitted.

Operating profit (EBIT — Earnings Before Interest and Taxes) is the result of a company's core operations, before financial items and tax. It shows whether the business itself makes money.

EBITDA (Earnings Before Interest, Taxes, Depreciation and Amortization) is a company's result before interest, tax, depreciation, and write-downs — a measure of operating earnings before accounting and financial items affect the picture.

Equity (egenkapital) is the difference between a company's assets and its liabilities — the owners' share of the company. It typically consists of share capital, retained earnings, and any reserves.

Liabilities (gældsforpligtelser) are the company's debt to banks, suppliers, public authorities, and other creditors. They are split into current liabilities (due within one year) and long-term liabilities.

Revenue (nettoomsætning) is a company's total income from sales of goods and services in the fiscal year, excluding VAT and net of discounts.

Current assets (omsætningsaktiver) are assets not intended for lasting use, expected to be converted to cash within a short period — typically inventory, trade receivables, and cash.

The reporting class (A, B, C, or D) is the Danish Financial Statements Act's grouping of companies by size and type. The class determines the content requirements for the annual report — the higher the class, the more disclosure.

The audit requirement (revisionspligt) is the duty to have the annual financial statements audited by an approved auditor. Small companies can under certain conditions opt out of audit if they stay below the statutory size limits.

A dividend (udbytte) is the part of a company's profit distributed to the owners rather than retained in the business. Ordinary dividends are approved at the general meeting based on the annual report.

Return on assets (afkastningsgrad) shows how much operating profit a company generates per krone tied up in assets. It is calculated as operating profit divided by the balance sheet total, multiplied by 100.

Return on equity (egenkapitalforrentning, ROE) shows how large a return the company generates on the owners' capital. It is calculated as the net result divided by equity, multiplied by 100.

The liquidity ratio (likviditetsgrad) shows a company's ability to pay its current liabilities with its current assets. It is calculated as current assets divided by current liabilities, multiplied by 100.

The profit margin (overskudsgrad) shows how large a share of revenue ends up as operating profit. It is calculated as operating profit divided by net revenue, multiplied by 100.

The solvency ratio (soliditetsgrad) shows how large a share of a company's assets is financed with equity. It is calculated as equity divided by the balance sheet total, multiplied by 100.

An aktieselskab (A/S) is a Danish limited company with share capital of at least DKK 400,000 and a requirement for both an executive board and a board of directors (or supervisory board). Only an A/S can be listed on a stock exchange.

An anpartsselskab (ApS) is a Danish private limited company where the owners are liable only for their contribution. It is Denmark's most common company type and requires share capital of at least DKK 20,000.

A sole proprietorship (enkeltmandsvirksomhed) is a personally owned business with one owner, who is personally and unlimitedly liable for the business's obligations. There is no capital requirement, and the business is not a separate legal entity.

A holding company (holdingselskab) is a company (typically an ApS or A/S) whose primary purpose is to own shares in other companies rather than run its own operations. The structure is used to separate risk and defer tax.

An interessentskab (I/S) is a Danish general partnership with at least two owners (partners) who are personally, unlimitedly, and jointly liable for the business's debt. Partners can be both individuals and companies.

The iværksætterselskab (IVS) was a Danish limited-liability company form with a capital requirement of just DKK 1, introduced in 2014 and abolished in 2019. Existing IVS companies had to convert to ApS or be dissolved.

The bestyrelse (board of directors) is a company's supreme governing body: it sets strategy, appoints the executive board, and supervises day-to-day management. An A/S must have a board (or supervisory board); in an ApS it is optional.

An industry code is a 6-digit code from the Danish Industry Classification 2007 (DB07) describing a company's main activity. The company chooses the code itself at registration and can additionally state up to three secondary industries.

A CVR number is the 8-digit number a company is assigned when registered in the Danish Central Business Register (CVR). The number is the company's unique identification towards authorities, customers, and suppliers.

The direktion (executive board) is a company's day-to-day management — one or more directors registered in CVR who run daily operations. Every Danish limited company must have one.

Legal owners (legale ejere) are the direct owners of a company holding at least 5% of the share capital or voting rights. Legal owners can be both natural persons and other companies, and stakes are registered in intervals (5-10%, 10-15%, etc.).

A P number (production unit number) is a 10-digit number identifying each physical location from which a company operates. Every company has at least one P number linked to its CVR number.

Beneficial owners (reelle ejere) are the natural persons who ultimately own or control a company — as a starting point, persons with more than 25% of the shares or voting rights, directly or indirectly through other companies.

Reklamebeskyttelse (advertising protection) is a flag in CVR a company can opt into, prohibiting others from using its registered information for direct marketing — e.g. addressed advertising and cold calls.

Share capital (selskabskapital) is the capital the owners have subscribed and contributed to a limited company. The minimum is DKK 20,000 for an ApS and DKK 400,000 for an A/S. The capital is public in CVR and can later be increased or reduced.

The tegningsregel (power-to-bind rule) is the provision in a company's articles of association determining who can enter binding agreements on the company's behalf — e.g. 'the company is bound by one director' or 'by the entire board'. It is public in CVR.

Konkurs (bankruptcy) is the judicial winding-up of an insolvent company: the bankruptcy court issues a decree, a trustee takes over the estate, assets are sold, and proceeds are distributed to creditors by statutory priority.

Konkurskarantæne (bankruptcy quarantine) is a ban the bankruptcy court can impose on a person who conducted grossly irresponsible business in a bankrupt company. The ban means the person — typically for three years — may not participate in the management of limited-liability companies.

Likvidation (voluntary liquidation) is the winding-up of a solvent company: the general meeting decides to dissolve, a liquidator winds down operations, all creditors are paid in full, and the remaining assets are distributed to the owners.

Rekonstruktion (restructuring) is a court-supervised process to save an insolvent but viable company from bankruptcy — typically through a compulsory composition (writing down debt), a business transfer, or both.

Tvangsopløsning (forced dissolution) is when the Danish Business Authority asks the bankruptcy court to dissolve a company because it fails statutory requirements — most often a missing annual report, missing registered management, or missing auditor.

Due diligence is the systematic investigation of a company ahead of a decision carrying significant risk — an acquisition, an investment, a credit engagement, or a strategic partnership.

A kreditoplysningsbureau (credit reporting agency) is a business that commercially processes and discloses information for assessing financial standing and creditworthiness. Operating one requires a licence from the Danish Data Protection Agency and is regulated by the Danish Data Protection Act.

A credit assessment (kreditvurdering) is a systematic evaluation of whether a company can and will pay its obligations. It typically builds on financials and key figures, the company's age and industry, and the history of management and owners.

A lead list is a list of potential customers (leads), selected on criteria matching your target audience — typically industry, geography, employee count, financial key figures, and other data points.

Segmentation is dividing a market into groups (segments) with shared characteristics so sales and marketing can be targeted. In B2B, segmentation typically uses industry, size, geography, and financials — so-called firmographic criteria.