PREPARATION OF QUALIFIED FINANCIAL STATEMENTS IN ACCORDANCE WITH COMMERCIAL AND TAX LAW
Preparing annual financial statements in accordance with commercial and tax law is one of the reserved tasks for tax consultants.
Laymen can make many mistakes.
Therefore: let us prepare your annual financial statements professionally.
Balance sheet, profit and loss account, notes and management report - you will find support from us!
In principle, all merchants must prepare annual financial statements within certain deadlines.
Only sole proprietorships with low turnover and profits do not have to prepare financial statements.
Annual financial statements consist of at least a balance sheet and a profit and loss account (P&L).
In addition, GmbH & Co KGs and corporations such as GmbHs must prepare notes and comply with other regulations, unless they fall under the exemptions for micro-corporations.
In addition, companies must prepare a b of a certain size must prepare a management report.
This must be audited by an independent auditor or sworn accountant.
Annual financial statements as a basis for decision-making
Annual financial statements are an important basis for decision-making.
For example, when investors or buyers are sought for a company or when banks grant loans.
They also inform shareholders and third parties about the company’s business success.
Due to deviating regulations in commercial and tax law, a different tax balance sheet must be prepared in many cases.
What is required when preparing annual financial statements
- Reconciliation of the opening balance sheet with the closing balance sheet of the previous year
- Critical review of financial accounting
- Deferral of revenue and costs to the correct financial year
- Depreciation of fixed assets
- If necessary, value adjustment of receivables
- Participation in the inventory, if applicable
- Support with the valuation of inventories
- Determine provisions
- Perform tax calculation
- Note if there is a potential risk of insolvency, e.g. in the event of balance sheet over-indebtedness or (imminent) insolvency.
As auditors, we always prepare a report on the preparation of the annual financial statements in accordance with the requirements of IDW S 7, which you can present to your bank or other shareholders, for example.
This is because banks appreciate it when an auditor has prepared the annual financial statements, as the quality is often considered to be higher than when prepared by tax consultants alone.
Differing regulations in commercial and tax law sometimes require a tax balance sheet that differs from the commercial balance sheet.
Preparation of tax balance sheets
The figures to be entered in the tax return are derived either from the commercial balance sheet or a separate tax balance sheet.
The tax balance sheet is prepared solely in accordance with the rules of tax law.
It has the task of determining the basis for calculating income tax.
This is also known as the assessment basis.
The main differences between commercial and tax balance sheets can be found here.
Too much information at once?
As tax consultants, we know how quickly outsiders can become confused by the terminology.
And you don’t need to.
Leave the preparation of tax balance sheets as part of qualified annual financial statements to us.
Preparation of commercial balance sheets
The annual financial statements are prepared from the accounting derived from the bookkeeping.
If the bookkeeping is incomplete or incorrect, this leads to incorrect annual financial statements.
And this leads to trouble with the tax office if the turnover does not match the advance VAT returns submitted.
This often leads to queries from the tax office or special VAT audits.
If the bookkeeping contains errors, we correct them in the annual financial statements.
If we have already prepared the bookkeeping, the work involved in preparing the annual financial statements is less.
Revenue surplus accounts
If you are not obliged to prepare annual financial statements, it is sufficient to determine the profit as the surplus of operating income over operating expenses at . These are then compiled in a so-called income statement. You can find more information on this here.
You are welcome to commission us to prepare your income statement at . Also the relevant tax forms, In this context, we are also happy to fill out the relevant tax forms that the tax office must receive.
Disclosure - meet deadlines, otherwise you could face high fines
In order to avoid fines, certain financial data must be disclosed or filed depending on the size and legal form.
Further details can be found here.
