The consultant´s journey

Bringing Theory to Practice - By books, articles, research and lectures

Category: Books and articles (page 1 of 7)

Work in Progress Part 1 / Pågående arbeten del 1

Bulletinen 3 2017 Pågående arbeten del 1 The Bulletin Work in Progress Part 1




My article Work in Progress, Part 1 Current Account has been published in issue 3/2017 of The Bulletin, by BAS who also maintains the BAS Chart of Accounts (text in Swedish follows further below).

The article is in Swedish. I begin with describing which entities that are to apply the standards for accounting of work in progress, namely service and construction enterprises – a large part of the total number of entities. Then follows general regulations, such as applying the main or alternative method for current account and fixed price assignments respectively, and the three valuation situations you can end up in: assignments with claim, debt and maybe loss. After this the main attraction of part 1 comes – how to treat assignments of current accounts in the accounting. Here I describe how to account for work in progress on current accounts when applying the BAS Chart of Accounts, step by step, and how to report in the financial statements.

Here you have the article as a PDF-file (in Swedish), published with permission from The Bulletin.

In the next issue of the Bulletin I will describe the accounting of assignments to fixed prices, and how to report them in the financial statements. This second part ends with an overview of the connections between accounting and taxation for all the alternatives and for current account as well as fixed price assignments.  I’ll be back on this topic when the second part has been published.

The two articles covers how to apply standards from the governmental body The Swedish Accounting Standards Board (BFN) for the smallest private companies (K1), smaller companies (K2) and larger companies (K3). To some extent I also comment the standards from IASB as they are interpreted for the EU and then for Sweden by the private body RFR in the standard RFR 2 (listed companies).

See other published articles by me here!

 

In Swedish

Min artikel Pågående arbeten, del 1 löpande räkning har publicerats i utgåva 3/2017 av Bulletinen, som ges ut av BAS-kontogruppen.

Jag börjar med att beskriva vilka företag som ska tillämpa reglerna om pågående arbeten, nämligen tjänsteföretag och entreprenadföretag – en stor del av det totala antalet företag i Sverige. Sedan följer allmänna regler, såsom att tillämpa huvudregeln eller alternativregeln för pågående räkning respektive fast pris, och de tre värderingssituationerna du kan hamna i: uppdrag med fordran, skuld och kanske förlust. Efter detta kommer huvudattraktionen – hur uppdrag på löpande räkning behandlas i redovisningen. Jag beskriver steg för steg hur pågående arbeten på löpande räkning bokförs enligt BAS-kontoplanen, och hur de tas upp i årsredovisningen.

Här har du artikeln som PDF-fil, återgiven med tillstånd av Bulletinen.

I nästa utgåva av Bulletinen kommer jag att beskriva bokföringen av uppdrag till fast pris och hur de tas upp i årsredovisningen. Denna andra del avslutas med en översikt över sambandet redovisning-beskattning för alla alternativ och för löpande räkning såväl som fast pris. Jag återkommer när artikeln har publicerats.

Båda artiklarna täcker tillämpningen av K1, K2 och K3, och i någon mån RFR 2.

Jag hoppas du får praktisk hjälp av artiklarna och att de hjälper dig få grepp om redovisningen av pågående arbeten!

See other published articles by me here!


Besök Nätbutiken och bli inspirerad!
Visit the Web Shop and get inspired!

Method: Bringing Theory to Practice
Results: Web Shop
Stay Informed: Newsletter

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Chronicle for Wolters Kluwer / Krönika för Wolters Kluwer

Peter Berg

Photography © Wolters Kluwer
(photo by Stefan Bohlin)

Wolters Kluwer asked me to write about my personal user experience of transition from local software Bokslut (Financial Reports) to cloud based software Capego Bokslut (text in Swedish follows further below).




Happily I want to work, because I was thrilled about the great development they achieved of the user interface. Wolters Kluwer had visions of creating a seamless software, guiding you through the working process without you having to think about how to navigate back and forth between menus. And they really made it!

My article was published by Wolters Kluwer as a chronicle at their web site. Here it is (in Swedish):

Wolters Kluwer also promoted my chronicle in their digital news magazine Insight, both in the premier issue on September 20 and in the next issue on October 27, 2017.

In Swedish

Wolters Kluwer bad mig att skriva om min personliga erfarenhet som användare, av att byta från det lokala programmet Bokslut till det molnbaserade programmet Capego Bokslut. Det gjorde jag gärna, eftersom jag var entusiastisk över den stora utvecklingen de hade lyckats med av användargränssnittet. Wolters Kluwers vision var att skapa en sömlös programvara, som leder dig genom arbetsprocessen utan att du behöver tänka på navigering fram och tillbaka mellan olika menyer. Och de har verkligen lyckats!

Min artikel publicerades av Wolters Kluwer som en krönika på deras hemsida. Här är den.

Wolters Kluwer marknadsförde krönikan i sitt digitala nyhetsmagasin Insight, både i premiärutgåvan den 20 september 2017 och i nästa utgåva den 27 oktober.


Besök Nätbutiken och bli inspirerad!
Visit the Web Shop and get inspired!

Method: Bringing Theory to Practice
Results: Web Shop
Stay Informed: Newsletter

Subscribe to Blog by Email

Enter your email address to subscribe and receive notifications of new posts.

Web Shop Launched / Nätbutiken lanseras

Webbshopp Web Shop Consultant's Journey Peter Berg

Today the web shop for professional economists is launched (text in Swedish follows further below)!

This is the place to:

  • Order books
  • Subscribe to journals
  • Book lectures and webinars

This is also where you order:

  • Company web site updates
  • Newsletters for your company

The web shop is divided into six sections for your overview. Welcome – Visit the Web shop and get inspired!




In Swedish

Idag lanseras nätbutiken för professionella ekonomer!

Här är din plats för att:

  • Beställa böcker
  • Prenumerera på tidskrifter
  • Boka föreläsningar och webbinarier

Det är också här du beställer:

  • Nyhetsuppdateringar för företagets hemsida
  • Nyhetsbrev för ditt företag

Nätbutiken är indelad i sex avdelningar för att hjälpa dig får överblick. Välkommen – Besök Nätbutiken och bli inspirerad!

Resultat- och inkomstplanering Fastigheter Bulletinen Svensk Skattetidning SvSkt Pågående arbeten Tantiem

© Peter Berg (peter@hpberg.se)

Method: Bringing Theory to Practice
Results: Web Shop
Stay informed: Newsletter

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Article for RH on Scrapped Tax Legislation / Artikel för RH om skrotade skatteförslag

3:12-regler 3:12-utredning fåab-regler utdelning kapitalvinst

Yesterday August 26, 2017 the Swedish government scrapped proposals for raised taxes in two areas and eased a third one (text in Swedish follows further below).

I published an article in Swedish today on RedovisningsHuset i Södertälje AB’s web site Full stop for the Governments Tax Raises for Owner-Managed Companies. The changes are results of a political unrest concerning several of the governments tax proposals. One of the scrapped proposals concerns New Legislation for Owner-managed Companies.

I also describe two other important tax matters which are not affected by yesterdays turmoil, but continues to be prepared for legislation according to plan: Limited Interest Deductions for Companies and Update Real Estates: Packaging to an end?

With so much going on the readers need all help to keep track on what’s on and what’s not!




In Swedish

I går den 26 augusti 2017 meddelade regeringen att de skrotar två förslag till skattehöjningar och mildrar ett tredje.

Jag publicerade en artikel i dag på RedovisningsHuset i Södertälje AB:s hemsida Regeringen backar helt om 3:12-regler. Förändringarna beror på politisk orolighet om regeringens skatteförslag. Ett av de skrotade förslagen gäller Nya 3:12-regler.

Jag beskriver också två andra viktiga skatteförslag som inte berörs av gårdagens förändringar, utan fortsätter att beredas enligt plan fram till kommande lagförslag: Begränsade ränteavdrag för företag och Slutet för paketering av fastigheter?

Med så mycket på gång nu så behöver läsarna all hjälp för att hålla reda på vad som är på gång och inte!


Lectures / Föreläsningar

Keep yourself updated by education! I give lectures on legislation and standards for accounting, as well as other economic topics.

Håll dig uppdaterad genom att gå på kurs! Jag håller föreläsningar om lagstiftning och K-regler för redovisning, liksom om andra företagsekonomiska ämnen.

  1. Choose lecture / Välj föreläsning (Publications & Lectures)
  2. Book / Boka (Contact)
  3. And-or buy the books! / Och-eller köp böckerna! (Publications & Lectures)

Comment and follow

Do you have opinions on this post?
You’re welcome to comment my blog below
and please feel free to sign up as a followerResultat- och inkomstplanering Fastigheter Bulletinen Svensk Skattetidning SvSkt Pågående arbeten Tantiem© Peter Berg (peter@hpberg.se)

Method: Bringing Theory to Practice
Results: Publications and Lectures
Stay informed: Newsletter

Subscribe to Blog by Email

Enter your email address to subscribe to this blog and receive notifications of new posts by email.

 

Article on Actual Control Person Act for RH / Artikel om verklig huvudman för RH

Bolagsverket Register verklig huvudman Penningtvättsregister Actual Control Person Anti-Money Laundry Register

Today I published an article in Swedish about the Actual Control Person Act on the web site for RedovisningsHuset i Södertälje AB, Register Actual Control Person from September 1, 2017 (text in Swedish follows further below).

In the article I describe the new law, which introduces a mandatory demand on almost all juristic persons in Sweden to register which physical person who is in control of the organisation. I also tip the readers that they have a six-month free window to register, then there will be a fee.

This article is a part of RedovisningsHusets ambitions to help concerned customers judge if they are concerned and, if so, register in time.

I also have a webinar on the subject for Accountor Training in October 2017, Webinar Anti-Money Laundering Act, which include a section about the Actual Control Person Act.




In Swedish

Idag publicerade jag en artikel om lagen om registrering av verklig huvudman på hemsidan för RedovisningsHuset i Södertälje AB, Registrering av verklig huvudman från 1 september 2017.

I artikeln beskriver jag den nya lagen, som inför en skyldighet för nästan alla juridiska personer att registrera vilken eller vilka fysiska personer som bestämmer över verksamheten. Jag tipsar också läsarna om att de har en sexmånaders gratisperiod för registrering, sedan måste de betala en avgift för registreringen.

Artikeln är ett led i RedovisningsHusets arbete med att hjälpa kunderna att avgöra om de berörs, och i så fall att göra registreringen i tid. Kanske kan innehållet vara till nytta för dig också – följ länken ovan och se efter!

Jag har även ett webbinarium i ämnet för Accountor Training i oktober 2017, Lagen mot penningtvätt, som inkluderar ett avsnitt om lagen om registrering av verklig huvudman.


Lectures / Föreläsningar

Keep yourself updated by education! I give lectures on legislation and standards for accounting, as well as other economic topics.

Håll dig uppdaterad genom att gå på kurs! Jag håller föreläsningar om lagstiftning och K-regler för redovisning, liksom om andra företagsekonomiska ämnen.

  1. Choose lecture / Välj föreläsning (Publications & Lectures)
  2. Book / Boka (Contact)
  3. And-or buy the books! / Och-eller köp böckerna! (Publications & Lectures)

Comment and follow

Do you have opinions on this post?
You’re welcome to comment my blog below
and please feel free to sign up as a followerResultat- och inkomstplanering Fastigheter Bulletinen Svensk Skattetidning SvSkt Pågående arbeten Tantiem© Peter Berg (peter@hpberg.se)

Method: Bringing Theory to Practice
Results: Publications and Lectures
Stay informed: Newsletter

Subscribe to Blog by Email

Enter your email address to subscribe to this blog and receive notifications of new posts by email.

Article on the EU GDPR for RedovisningsHuset / Artikel om dataskyddsförordningen

RedovisningsHuset i Södertälje AB Nyhetsbrev Newsletter

Today I wrote and posted an article in Swedish about the EU General Data Protection Regulation GDPR (Your checklists for GDPR) on the web site of RedovisningsHuset i Södertälje AB (text in Swedish follows further below).

The article is mainly targeting their corporate customers. The GDPR will be in force as law on May 25, 2018 simultaneously in all the EU member states. Our message is that it’s time to prepare and act now. Don’t think there’s time and this is nine months away, think it’s only nine months left!

The article contains a check list in 13 steps for companies and organisations for how to prepare to fulfill the GDPR. In an additional section I describe the six available legal basis for personal data processing, with highlights of what’s most probable to come in handy.

In another post I describe a webinar I’m holding for Accountor Training on GDPR, Webinar EU Data Protection GDPR. You’re welcome to apply!




In Swedish

I dag skrev jag artikeln Dataskyddsförordningen – Dina checklistor för GDPR och lade upp den på RedovisningsHuset i Södertälje AB:s hemsida.

Artikeln riktar sig i första hand till företagskunder. GDPR träder i kraft som lag den 25 maj 2018, samtidigt i alla EU:s medlemsländer. Vårt budskap är att det är dags att förbereda sig och agera nu.  Tänk inte att du har tid på dig och det är nio månader bort, tänk det är bara nio månader kvar!

Artikeln innehåller en checklista på 13 punkter för företag och organisationer om hur de kan förbereda sig för att följa GDPR. I ett eget avsnitt tar jag upp de sex möjliga rättsliga grunderna för att behandla personuppgifter, med kommentarer om vilka grunder som kan komma bäst till hands.

Läs artikeln du också – den kan visa sig innehålla viktig information för ditt företag!

I ett annat inlägg beskriver jag ett webbinarium jag håller för Accountor Training om GDPR, Dataskyddsförordningen. Du är välkommen att anmäla dig!


Lectures / Föreläsningar

Keep yourself updated by education! I give lectures on legislation and standards for accounting, as well as other economic topics.

Håll dig uppdaterad genom att gå på kurs! Jag håller föreläsningar om lagstiftning och K-regler för redovisning, liksom om andra företagsekonomiska ämnen.

  1. Choose lecture / Välj föreläsning (Publications & Lectures)
  2. Book / Boka (Contact)
  3. And-or buy the books! / Och-eller köp böckerna! (Publications & Lectures)

Comment and follow

Do you have opinions on this post?
You’re welcome to comment my blog below
and please feel free to sign up as a followerResultat- och inkomstplanering Fastigheter Bulletinen Svensk Skattetidning SvSkt Pågående arbeten Tantiem© Peter Berg (peter@hpberg.se)

Method: Bringing Theory to Practice
Results: Publications and Lectures
Stay informed: Newsletter

Subscribe to Blog by Email

Enter your email address to subscribe to this blog and receive notifications of new posts by email.

Newsletters for RedovisningsHuset Nov 2016 – Jun 2017

RedovisningsHuset i Södertälje AB Nyhetsbrev Newsletter

Each month I write a newsletter for RedovisningsHuset i Södertälje AB, based on news articles I also write for them on their Web site on a regular basis. You can find the editions at their News letter archive.

Below follows a short resume in Swedish, then English summaries.




SW: Saknar ditt företag nyhetsbrev?

Nyhetsbrev är kraftfulla och uppskattade verktyg för marknadsföring – när innehållet är intressant och hjälper läsaren. Det är också ett utmärkt sätt att påminna dina kunder och kontakter om ditt företag och er kompetens.

Har inte ditt företag ett nyhetsbrev eller uppdateras inte hemsidan? En effektiv kombination är att först uppdatera hemsidan regelbundet med användbart material, för att sedan sprida nyheterna genom ett nyhetsbrev. Då kan du hålla nyhetsbreven korta och skapa trafik till hemsidan.

Jag skriver nyheter om ekonomiska ämnen, både som artiklar och nyhetsbrev, på svenska och engelska. Kontakta mig för ett lönsamt samarbete!

EN: Does your enterprise lack a newsletter?

Newsletters are powerful and appreciated tools of marketing – when the content is helpful for the recipients. And it’s a great way of reminding your customers and contacts about your existence and skills.

Doesn’t your enterprise have a newsletter or isn’t your web site updated? A great combination is to primarily update you web site regularly with useful content and then spread the news about it by a newsletter. Then you can keep your newsletters short and drive traffic to your web site.

I write news about economy matters, both as articles and newsletters, in English and Swedish. Contact me about a profitable cooperation!

EN: English summaries

Since my latest post on this, from October 24, 2016 Newsletters for RedovisningsHuset September – October 2016, we’ve added eight more editions to the archive. The newsletters and articles are in Swedish, but here comes short reviews in English. They are also good examples of how you can design your newsletter – each item is linked in the newsletters to corresponding article on the web site!

Ed. 29 – November 15, 2016

  • Governmental investigation raises the tax for shareholders in smaller, owner-managed companies
  • Stop for private packaging of real estates before sale – in some cases
  • Change of rules for delaying tax from sale of private real estates
  • Email invoice and automatic payment
  • Business hours Nov – Dec

Ed. 30 – December 12, 2016

  • Tax arrears already December 12
  • Legislation decided on changed delay of tax from sale of private real estates
  • Tax changes 2017 – New possibilities
  • 4 strong reasons to get your ready-made limited company now in December
  • Less paper handling – More digital
  • Business hours Dec- Jan

Ed. 31 – January 13, 2017

  • Income statements and salary reporting for 2016 ends January 31
  • Income statements every month proposed as new law
  • Tax deductions for representation meals mainly stopped from 2017 – When each enterprises next fiscal year begins
  • Important dates 2017
  • Amounts and percentages 2017
  • Business hours Jan – Feb

Ed. 32 February 20, 2017

  • We upgrade to better and modern accounting systems
  • This way you can get rid of your accounting documents 4 years earlier
  • We help you look out for forbidden loan situations in companies
  • Deduction dictionary for enterprises and entrepreneurs
  • Business hours Feb – Mar

Ed. 33 March 27, 2017

  • The government backs on parts of  tax raises for shareholders in smaller, owner-managed companies
  • Partial stop for packaging of real estates before sale sent for judicial preview
  • Calculation help for tax and VAT deductions of representation meals
  • Expanding support of first employment in limited companies and partnerships
  • Business hours Mar – Apr

Ed. 34 April 19, 2017

  • Tax raise for car benefits suggested by the government
  • Tax raises for real estates suggested by a governmental investigation
  • Outcome of judicial preview of the partial stop for packaging of real estates before sale
  • Retirement savings with failed deductions
  • Business hours Apr – May

Ed. 35 May 10, 2017

  • Prepare for the new EU General Data Protection Regulation (GDPA)
  • Government’s spring budget nothing for entrepreneurs
  • Now we’re transiting to email invoicing
  • Business hours May – Jun

Ed. 36 June, 2017

  • Legislation decided about income statements every month
  • Tax raises for shareholders in smaller, owner-managed companies sent for judicial preview
  • Tax raise for car benefits sent for judicial preview – after changes
  • Expanding support of first employment in limited companies and partnerships sent for judicial preview
  • Stricter amortization requirements proposed for households with high debts
  • Business hours Jun – Aug, including closed for vacation

There you are! Here’s how it can be done. Another example is my own Economy News. If you want something like this for your enterprise, feel free to Contact me. And if you have opinions on this post, feel free to comment below thank you!


Lectures / Föreläsningar

Keep yourself updated by education! I give lectures on legislation and standards for accounting, as well as other economic topics.

Håll dig uppdaterad genom att gå på kurs! Jag håller föreläsningar om lagstiftning och K-regler för redovisning, liksom om andra företagsekonomiska ämnen.

  1. Choose lecture / Välj föreläsning (Publications & Lectures)
  2. Book / Boka (Contact)
  3. Buy the books! / Köp böckerna! (Publications & Lectures)

Comment and follow

Do you have opinions on this post?
You’re welcome to comment my blog below
and please feel free to sign up as a follower

Resultat- och inkomstplanering Fastigheter Bulletinen Svensk Skattetidning SvSkt Pågående arbeten Tantiem

Method: Bringing Theory to Practice
Results: Publications and Lectures
Stay informed: Newsletter

Subscribe to Blog by Email

Enter your email address to subscribe to this blog and receive notifications of new posts by email.

Impairment of Municipal Assets / Nedskrivning av kommunala tillgångar

Impairment assets real estates Municipal assets real estates Nedskrivning tillgångar fastigheter kommunala tillgångar fastigheter

Companies following the prime cost principle of the Municipal Act can’t easily apply normal regulations for impairment of fixed assets, such as real estates. It might cause a great need of impairments with following requirements of contributions from the municipalities. Therefor the governmental body The Swedish Accounting Standards Board (Bokföringsnämnden, BFN) have changed it’s regulations for larger companies, K3 (a Swedish version follows further below).

 

Update of K3

June 12, 2017, BFN decided on the update of K3 with effect from the same day. Companies following the municipal prime cost principle can still apply normal regulations for impairments, but they are now given an option by amendment in 27.1 K3.

The option is to apply the same regulations as non-profit associations to identify potential needs of impairment  (37.23-27 K3). If a fixed asset is assumed to have decreased in value the assets loss value shall be calculated. The loss value is the lowest of the replacement or regaining values, considering all restrictions to use the asset. A simplified alternative is to use the insurance value for the asset as the loss value.

There are no transitional regulations for the change. A possible interpretation is that the new option can be applied in financial reports prepared after June 12, 2017 regardless of the fiscal year. Municipalities must however use the calendar year as the fiscal year, which also apply to all subsidiaries according to regulations for the consolidated accounts. It’s therefor reasonable to say that this new option will be used first time for fiscal years ending December 31, 2017.




Swedish version:

Uppdatering av K3

Kommunala företag som följer självkostnadsprincipen i kommunallagen kan inte utan vidare tillämpa de ordinarie reglerna för nedskrivningar av tillgångar, som till exempel fastigheter. Det kan leda till stora behov av nedskrivningar och tillskott från kommunerna. Därför har Bokföringsnämnden (BFN) ändrat regelverket för större företag och företagsgrupper, K3.

Den 12 juli 2017 beslöt BFN om ändringen av K3, som trädde i kraft samma dag. Ordinarie regler för nedskrivningar kan fortfarande användas, men en frivillig möjlighet har införts för kommunala företag som följer självkostnadsprincipen genom ändrad formulering av 27.1 K3.

Den nya möjligheten är att dessa företag får tillämpa samma regler som föreningar vid identifiering av eventuella nedskrivningsbehov (37.23-27 K3). Om det kan antas att en anläggningstillgång har minskat i värde ska tillgångens förlustvärde beräknas. Förlustvärdet är det lägsta av återanskaffningsvärdet och återvinningsvärdet, med hänsyn till eventuella restriktioner för att använda tillgången. En förenklingsregel finns som säger att tillgångens försäkringsvärde får användas som förlustvärde.

Inga övergångsregler har beslutats för denna ändring. En möjlig tolkning är att det nya alternativet kan användas i årsredovisningar som upprättas efter den 12 juni 2017, oavsett när räkenskapsåret slutar. Kommuner måste dock tillämpa kalenderår som räkenskapsår, vilket påverkar alla dotterföretag enligt reglerna för koncernredovisningar. Därför blir det rimligt med slutsatsen att det nya alternativet kan användas första gången för räkenskapsår som slutar den 31 december 2017.

 

My books / Mina böcker

English

My book “Performance and Income Planning” from 2015 relate to owner-managed entities and is not relevant for municipal companies.

However, my book “Real Estates” from 2016 is concerned by the change in K3.

  • Chapter 6 ”Impairments” explains the regulations, showing examples and references (page 181-198)
    • Companies applying the municipal prime cost principle does now have an alternative method for handling impairments, in addition to the content of this chapter of the book

Swedish

Min bok ”Resultat- och inkomstplanering” (2015) är inriktad på ägarledda företag och berör därför inte kommunala verksamheter.

Däremot berörs min bok ”Fastigheter” (2016) av ändringen i K3.

  • Kapital 6 ”Nedskrivningar” förklarar reglerna, med exempel och referenser (sidorna 181-198)
    • Företag som lyder under den kommunala självkostnadsprincipen har nu fått en alternativ metod för att hantera nedskrivningar, förutom vad som beskrivs i detta kapitel i boken

Lectures / Föreläsningar

Keep yourself updated by education! I give lectures on legislation and standards for accounting, as well as other economic topics.

Håll dig uppdaterad genom att gå på kurs! Jag håller föreläsningar om lagstiftning och K-regler för redovisning, liksom om andra företagsekonomiska ämnen.

  1. Choose lecture / Välj föreläsning (Publications & Lectures)
  2. Book / Boka (Contact)
  3. And-or buy the books! / Och-eller köp böckerna! (Publications & Lectures)

Comment and follow

Do you have opinions on this post?
You’re welcome to comment my blog below
and please feel free to sign up as a follower

Resultat- och inkomstplanering Fastigheter Bulletinen Svensk Skattetidning SvSkt Pågående arbeten Tantiem

Method: Bringing Theory to Practice
Results: Publications and Lectures
Stay informed: Newsletter

Subscribe to Blog by Email

Enter your email address to subscribe to this blog and receive notifications of new posts by email.

New Accounting Standard for Housing Associations

housing associations BRF bostadsrättsförening bostadsrätt tenant-owned apartment tenant ownership

A Swedish governmental investigation proposes a new standard for financial statements for housing associations. I have written an article in Swedish about it here Bostadsrättsföreningar får nya redovisningsregler.

A draft has been sent for comments until October 1, 2017. The changes are to be in force for fiscal years starting January 1, 2019 and later, according to the draft.




 

Today’s Standards Not Suitable for Housing Associations

In Sweden housing associations is a very common form of living. The association owns the building and supplies the members with tenant-owned apartments. The ownership is transferred by selling and buying member shares in the association.

Since a membership share can be quite pricey, at least in prime locations, the investigations has focused on improving the financial information that is provided by the housing associations in their financial statements.

In Sweden we have two general standards for financial statements, K2 for smaller entities and K3 for larger entities and groups. There is no specific standard for housing associations.

The draft includes many changes in several areas, but in the accounting areas the main changes are these.

  • Mandatory component depreciation
    • Affects the income statement more even, when major maintenance is accounted for as changes of components rather than large expenses at once
    • Today component depreciation is prohibited in K2 but mandatory for larger entities and groups applying K3
  • Mandatory cash flow statement
    • Today a cash flow statement is voluntary in K2 but mandatory for larger entities and groups applying K3
  • Mandatory additional financial ratios applicable for housing associations, such as
    • Annual fee/square meter
    • Depreciation and maintenance deposition/square meter
    • Debts/square meter
    • Interest sensitivity
    • Energy expenses/square meter

The changes are proposed for all housing associations, regardless of their sizes.

The draft doesn’t include detailed regulations for the financial statements, but proposes that the governmental body The Swedish Accounting Standards Board (Bokföringsnämnden, BFN) shall produce a new standard for financial statements of housing associations.

 

My Books

My book “Performance and Income Planning” (Resultat- och inkomstplanering) from 2015 relate to housing associations in two sections.

  • Corporate: Evaluate the depreciation plans and methods regularly in your performance planning, especially housing associations have frequently made bad assumptions historically (chapter 3.1 Balance Sheet, page 34-36)
  • Private: Choose your housing association wisely, so you’ll get a low cost living with high quality as a part of your income planning and retirement planning (chapter 5.5 Overall Issues, page 155-156)

My book “Real Estates” (Fastigheter) from 2016 relate to housing associations in numerous sections, but particularly here.

  • Corporate: Component depreciation is described, discussed and mentioned as a preferred alternative, with a high number of examples and references (chapter 4 “Depreciation”, section 4.1.3 ”Component depreciation”, page 135-145)

Lectures / Föreläsningar

Keep yourself updated by education! I give lectures on legislation and standards for accounting, as well as other economic topics.

Håll dig uppdaterad genom att gå på kurs! Jag håller föreläsningar om lagstiftning och K-regler för redovisning, liksom om andra företagsekonomiska ämnen.

  1. Choose lecture / Välj föreläsning (Publications & Lectures)
  2. Book / Boka (Contact)
  3. And-or buy the books! / Och-eller köp böckerna! (Publications & Lectures)

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You’re welcome to comment my blog below
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Resultat- och inkomstplanering Fastigheter Bulletinen Svensk Skattetidning SvSkt Pågående arbeten Tantiem

Method: Bringing Theory to Practice
Results: Publications and Lectures
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Limited Interest Deductions for Companies

100,000 SEK 100 000 kr ränteavdrag företagsskattekommittén

100,000 SEK, that will be the maximum annual deduction for a negativ interest net according to a simplified alternative if a new draft leads to legislation.

The draft consists of many tax changes. I have written about it in Swedish at the web page of RedovisningsHuset i Södertälje AB, Ränteavdrag slopas för företag – nästan.

The main object is to prohibit tax planning with deduction of interests, above all internationally.

Deductions for interests are not totally stopped, but the limitations will make it feel like at stop for companies with high debts and low earnings.




 

Schedule

The draft was sent for comments on June 20, 2017. Comments can be made until September 26, 2017. The plan is to have the new regulations in force for fiscal years beginning July 1, 2018 and later.

 

Several Limitations for Deductions of Interests

The object of the limitations is the net interest, calculated as interest incomes reduced with interest expenses. A positive net is fully taxable, but a negative net will only be deductible within the new limitations.

The Swedish government have asked for opinions on which deduction base to choose, EBIT or EBITDA, for calculation of the deduction of net interest.

  1. Main option: Up to 35 % of EBIT (Earnings Before Interest and Tax)
  2. Alternative option: Up to 25 % of EBITDA (Earnings Before Interest and Tax, Depreciation and Amortization)

Only one of the options will be included in the legislation.

As a simplified alternative, a company may chose to deduct up to 100,000 SEK for a negative interest net. In this alternative it’s not necessary to calculate the EBIT or EBITDA.

For company groups the limits shall be calculated as a total for all the companies in the group. That applies to all alternatives, EBIT, EBITDA and 100,000 SEK limit. The argument is to stop planning by dividing a company with a high negative interest net into several companies, to increase the total deductions.

An exceeding negative interest net can be saved for future deductions up to six years.

 

Reduced Corporate Income Tax

To compensate the companies for tax consequences of the new limits, the corporate tax is to be reduced from today’s 22 % to 20 %.

 

No Hybrid Mismatches

International tax planning with interests, between countries with different tax regulations, are to be stopped by totally stopping interest deductions in those cases.

 

No Interest Included in Assets

Companies can, if they want to, include interest related to investments that takes long time to complete, thus increasing the accounted value of the asset and accordingly decreasing the interest expenses.

In the draft the government proposes to stop this accounting possibility, to ensure that the deduction limits of negative interest rates are not evaded.

 

Tax Regulations for Leasing

Sweden doesn’t have any specific tax regulations for leasing, but in the draft such regulations are proposed. The purpose is to stop tax planning by eliminating negative interest nets with loans changing to leasing.

All financial leasing agreements shall be accounted for as if the company have bought the asset. This way the leasing fees are to be divided in amortization and interest.

Today only larger companies have to account like this, and then only in the consolidated accounts. The draft will lead to that larger companies have to account in the same way in the juristic person. Accounting regulations for smaller companies prohibit this way of accounting to day, but in the draft the government simply leaves that problem to the standard setting body The Swedish Accounting Standards Board (Bokföringsnämnden, BFN) to solve.

My comment: These regulations might, if they lead to legislation, have to be amended already within a few years since the new standard on leasing from IASB isn’t considered. In that new standard all leasing agreements will have to be accounted for as if they are financial leasing agreements, also the operational leasing agreements.

 

Untaxed Reserves Gets More Expensive

Swedish companies have a possibility to partially save earnings taxfree in reserves, but have to pay a standard tax as an interest on these reserves (”Periodiseringsfonder”). The draft proposes a raise of the standard tax to follow the new limitations of interest deductions.

 

Raised Depreciation for New Apartment Building

Real estate companies can face big problems with the new limitations of interest deductions, since they usually have high negative interest nets compared to their earnings.

The government is especially concerned of not disturbing the speed of building new houses for living, since Sweden is experiencing a great lack of housings. Therefor the draft includes a new ”primary deduction” for tenant buildings of 2 % annually the first five years after completion.

Normally 2 % per year can be deducted for an apartment building, meaning 50 years of depreciation time. With the primary deduction totally 4 % can be deducted per year in the beginning but after five years we’re back to the normal 2 % anually again, meaning 45 years of depreciation time.

 

Limited Carry Forward of Losses

Sweden have a system of carry forward losses. One years loss is deductible upcoming years, without limitation in time. The draft proposes that for two or three years after legislation only 50 % of saved losses will be deductible. The purpose of this temporary limitation is to help financing the reduced income tax, the primary deduction for new housings and more.

 

My Books

In my book ”Performance and Income Planning” (Resultat- och inkomstplanering) from 2015 I described these possible future changes in chapter 7.3 ”Company taxation committee” (Företagsskattekommittén), page 188-193, so I hope my readers are well prepared!

In my book ”Real Estates” (Fastigheter) from 2016 the possible changes of depreciation for new tenant buildings are of interest for chapter 4 ”Depreciation” (Avskrivningar).


Lectures / Föreläsningar

Keep yourself updated by education! I give lectures on legislation and standards for accounting, as well as other economic topics.

Håll dig uppdaterad genom att gå på kurs! Jag håller föreläsningar om lagstiftning och K-regler för redovisning, liksom om andra företagsekonomiska ämnen.

  1. Choose lecture / Välj föreläsning (Publications & Lectures)
  2. Book / Boka (Contact)
  3. And-or buy the books! / Och-eller köp böckerna! (Publications & Lectures)

Comment and follow

Do you have opinions on this post?
You’re welcome to comment my blog below
and please feel free to sign up as a follower

Resultat- och inkomstplanering Fastigheter Bulletinen Svensk Skattetidning SvSkt Pågående arbeten Tantiem

Method: Bringing Theory to Practice
Results: Publications and Lectures
Stay informed: Newsletter

Subscribe to Blog by Email

Enter your email address to subscribe to this blog and receive notifications of new posts by email.

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