In principle, every company in Switzerland must keep accounts. The legal basis for this is set out in the Swiss Code of Obligations. A distinction is made between double-entry and single-entry bookkeeping. The obligation to keep accounts is linked to the economic size of a company and to whether it is a legal entity.
According to Art. 957 para. 1 CO, all legal entities as well as all sole proprietorships with a turnover of at least CHF 500,000 are obliged to keep double-entry books. Double-entry bookkeeping means that annual financial statements with a balance sheet and income statement must be prepared.
Sole proprietorships with a turnover of less than CHF 500,000 as well as associations and foundations that are not required to be entered in the commercial register must keep simple accounts. Colloquially, the simple accounting obligation is also called "Milchbüchleinrechnung". It is only necessary to keep records of the company's income, expenses and assets. It is advisable to keep accounts even if turnover is low in order to keep an eye on the financial situation.