Group accounting

As a group, accounting refers to any actions and organizational measures to prepare and publish consolidated financial statements under generally accepted accounting principles.
Since the mid-20th Century have increased concentrations of a group of companies steadily. Modulating the corporations have become more international, both in terms of belonging to their company, and in view of the markets in which they operate. Following this development, more and more companies legally obliged to draw up complete financial statements. By the obligation or the right to vote consolidated accounts in accordance with International Financial Reporting Standards (IFRS), many countries do make the consolidated financial statements of companies of their country internationally comparable.
In Germany, with the Companies Act of 1965 initially required only listed companies to corporate accounting. With the Disclosure Act of 1969, the group accounting requirements has been extended to large companies with parent companies in other legal forms. Following the implementation of the 7th EC directive on the standardization of company law of 1983, the national rules on corporate accounting in the European Community, now the European Union (EU), converged. In Germany, the directive was implemented by the Accounts Directive Act of 1985, which introduced the basic provisions for consolidated accounts in the Commercial Code. In Austria, the Group accountability was first introduced by the Accounting Act of 1990, which entered into force on 1.1.1994. From 1998 to 2004, allowed the German legislator publicly traded parent company financial statements in accordance with international accounting rules, such as drawn up in accordance with IFRS or U.S. GAAP instead of consolidated financial statements in accordance with German commercial law. However, an EU regulation in 1992, publicly traded companies in the EU for the fiscal years beginning after 31.12.2004, required financial statements in accordance with IFRS set up, which were accepted by the EU through an endorsement process. Germany has taken by the Member State options made to all other companies should be given the right to vote, shall present consolidated financial statements according to commercial law, or IFRS.

Financial Statements

Consolidated financial statements is an annual or interim financial statements of a company. While he represents the Group's financial position and results of a group, he is both the members of the group serve as well as external users to information and decision making. The preparation of consolidated financial statements are first consolidated financial statements of the company standardized and summed to a total conclusion. Subsequently, this will be adjusted through consolidation measures to ensure linkages and economic relations between the group companies. After the unit fiction, which also is called the principle of unity, a consolidated financial statement is presented as if the group were a single company.
In a group, the parent company to have on the Group's subsidiaries, a dominant influence. Thus, there is often relationship between group companies, the independent companies would not normally go. Your business is focused in general on the group and can be better assessed in the group context. Therefore, the individual firings of the parent and the subsidiary are often less meaningful than the individual accounts of independent companies. The assets, liabilities, financial position and results of a group may be better represented by consolidated financial statements. This can also help the financial position and results of each group company to understand better.
Whether a parent has to prepare consolidated financial statements, determine national laws, stock exchange regulations, other accounting rules or agreement. Which companies included in consolidated financial statements (consolidation), is governed by the applicable accounting rules.
The scope of the consolidated financial statements is different depending on the accounting system. Often prescribe the accounting rules that the consolidated financial statements a balance sheet, profit and loss account or statement of comprehensive income, one notes, a statement of changes, including changes in equity referred to, and shall contain a statement of cash flows. Also, segment reporting may be part of the consolidated financial statements. Consolidated financial statements are intended to supplement in Germany and Austria for a consolidated management report.
In Germany, the information function of the consolidated financial statements is in the foreground. He is neither de jure nor the calculation of dividend yield as a basis for taxation.