How to read Finnish company financial statements
If you have the accounts of a Finnish customer or target, check the income statement format first. The way expenses are recorded and grouped differs from what many readers expect, and read naively it skews several ratios.
What reads differently
- Accounting basis: unlisted companies file individual statements under the Finnish Accounting Act (KPL); listed companies file IFRS consolidated statements. Do not mix the two.
- Expenses are negative: expense lines appear as negative numbers. Dividing by cost of sales or interest as filed flips the sign of ratios such as interest coverage.
- Mostly by nature: Chapter 1 of the Finnish Accounting Ordinance (Kirjanpitoasetus) prescribes one of two formats — by nature (§ 1, the default) or by function (§ 2). Most income statements classify expenses by nature (materials and services, staff costs, depreciation), so there is no cost of sales. "Materiaalit ja palvelut" is not cost of sales — it mixes purchases, inventory change and subcontracting — so inventory days, payable days and gross margin cannot be calculated as filed. Companies using the functional format report "Hankinnan ja valmistuksen kulut", which corresponds to cost of sales.
- Terms: revenue is Liikevaihto; the business ID is the Y-tunnus.
Finnish unlisted benchmarks (2025)
Industry medians for Finnish unlisted companies, calculated by Caveat (finance and insurance excluded).
| Industry | Debt-to-equity | DSO | ROE | Companies |
|---|---|---|---|---|
| Manufacturing | 52% | 25d | 13% | 879 |
| Construction | 62% | 22d | 14% | 2,314 |
| Wholesale and retail | 34% | 13d | 11% | 1,268 |
| Transport and storage | 81% | 26d | 15% | 769 |
| Accommodation and food | 50% | 6d | 16% | 629 |
| Telecoms and IT services | 20% | 34d | 13% | 534 |
| Professional and technical services | 29% | 34d | 14% | 2,832 |
| All unlisted | 40% | 22d | 14% | 14,398 |
The median debt-to-equity across all 14,398 unlisted companies is 40%. Industries differ widely, so compare a counterparty with its own industry row. Because most income statements have no cost of sales, inventory-based measures have far smaller samples and are left out of this table.
Limitations
- Benchmarks include only companies with an identified industry, mapped to the international ISIC Rev.5 classification.
- The number of companies included varies by year, so treat year-to-year comparisons as indicative.
- For reference only; it does not replace credit, investment or tax decisions.
FAQ
- Why are expenses negative in Finnish income statements?
- Finnish forms show expenses as negative numbers. Convert them to positive before calculating ratios so signs do not flip.
- Where is cost of sales in a Finnish income statement?
- Companies using the by-nature format, which is most of them, have no separate cost of sales. Materials and services is not a substitute. In the functional format, the purchase and production costs line is cost of sales.
- What debt-to-equity is typical for Finnish unlisted companies?
- Caveat's 2025 median across all Finnish unlisted companies is 40%, with wide differences by industry. Compare with the matching row in the table above.
- Can a Finnish company have zero share capital?
- Yes. Since 1 July 2019 the €2,500 minimum share capital for private limited companies (yksityinen osakeyhtiö) no longer applies, so a company can be founded with zero capital. Very small equity makes debt-to-equity swing widely, so read it alongside the amounts.
- Can I upload Finnish statements to Caveat?
- Yes, as PDF, Excel or image. With a by-nature income statement some inventory and margin measures cannot be calculated because there is no cost of sales.