ársreikningurinn

Ársreikningurinn is the Icelandic term for the annual financial statements of a company, government entity, or non-profit organization. It is a formal report that summarizes an entity’s financial performance and financial position over the preceding fiscal year and provides a basis for evaluating profitability, liquidity, and solvency.

The core components are typically the income statement (revenues and expenses for the year), the balance sheet (assets, liabilities, and equity at year-end), the cash flow statement (cash inflows and outflows), and notes that describe accounting policies and significant events. These elements together give readers a structured view of how the entity earned and used its resources during the year.

Preparation and audit: The annual accounts are prepared by management and approved by the appropriate governing body (for companies, the shareholders or the board). Depending on the entity’s size and legal form, an independent auditor may be required to examine the statements. The audited report is usually submitted to regulators, investors, creditors, and tax authorities.

Standards and scope: The ársreikningurinn is prepared in accordance with the applicable national accounting standards and legal requirements. Larger or listed entities may follow stricter frameworks, such as international or national accounting standards, while smaller entities may use simpler or local guidelines.

Relation to other reports: In many contexts, ársreikningurinn refers specifically to the financial statements, while a broader annual report may include management commentary, governance information, and future outlook. The two documents are related but serve different purposes for stakeholders.