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Financial reporting under IFRS in Germany

International Financial Reporting Standards (IFRS) in Germany

International financial reporting in an enterprise is the final stage of accounting work. However, not every report is considered to be correctly executed according to IFRS international. Large and small farms that do business in Germany must submit financial documents. Income and expenditure data do not disappear into thin air and must be presented to the highest authorities, the tax inspectorate, and regional and district administrations. In this regard, reports must be adequately prepared following financial reporting standards, and submitted on specific forms.

So, let’s understand what international financial reporting is and what forms need to be prepared according to financial standards

The concept of financial reporting and IFRS Germany

International financial reporting is the system of interconnected generalized indicators characterizing the company’s activity in the past reporting period. The data of individual accounting objects are summarized, and financial standards are considered.  For example, it can be statistics for a month, financial data for a quarter, or a report on gross income for a year. 

There are specific IFRS international:

  • reliability of data;
  • accuracy of reporting indicators;
  • comparison of these indicators with data from other periods;
  • accessibility and timeliness.

But these are not all the criteria. When preparing reports, accountants follow the Law on Accounting, IFRS Germany, as well as the specifics of the work of their enterprise. 

Enterprises must submit reports according to financial standards to labor collectives at their request, to the organization owner or founders, to executive authorities, in particular tax inspection, statistics service, and other instances following the law.

IFRS 2023 Quarterly and Annual Reporting Forms

According to the periodicity, the results are calculated once a quarter and a year. Quarterly international financial reporting in Germany involves the submission of these types of documents: 

  • enterprise’s balance sheet (form №1);
  • IFRS financial statement and its use (Form №2);
  • calculation of taxes and duties;
  • declaration of VAT and income of the enterprise. 

These documents also apply to the annual reporting, and there is also a form about the financial and property status of the firm. In addition, there are different annual reports depending on the form of ownership and the company itself (large, medium, small, and micro). The deadlines and IFRS international are prescribed in the country’s laws, by which accountants and heads of enterprises are guided.  

IFRS balance sheet must contain information on assets and liabilities, or, more precisely, their balances at the beginning and the end of the reporting period. Information in IFRS financial statement is arranged by sections, allowing to judge the use of income, expenditures of production turnover, payments to the budget, etc.

Conclusion about international financial reporting

All companies established by German law and financial standards must prepare and submit financial statements regardless of their legal form, representations of foreign economic entities, and budget-funded entities. At the same time, adhering to IFRS international when compiling documents is necessary. If there are questions about how to fill in the forms, it is better to ask for clarification information and to hire specialists from an outsourcing company. This way, you will cope with the task more quickly. Also, the time of calculating the results of the financial achievements of your business will always go positively and effectively. 

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