Which legal regulations must be considered when preparing a profit and loss statement?
February 13, 2023 | 40,00 EUR | answered by Fanni Ehrig
Dear tax advisor,
I am Renate Freudenberger and I have a small business that I have been successfully running for several years. In the past, I have always prepared the profit and loss statement myself, but lately I have the feeling that I am not complying with all legal requirements anymore.
I have heard that there are certain laws and regulations that need to be followed when preparing a profit and loss statement to avoid possible legal consequences. I feel unsure and want to make sure that I am doing everything correctly.
Could you please explain to me which legal requirements I need to consider when preparing a profit and loss statement? Are there specific paragraphs or guidelines that I should follow?
I am worried that I may be violating applicable law and therefore have to fear legal consequences. It is important to me to do everything correctly and in compliance with the law.
Thank you in advance for your support and advice.
Sincerely,
Renate Freudenberger
Dear Ms. Freudenberger,
Thank you for your inquiry and your trust in my expertise as a tax consultant. It is understandable that you are concerned about whether you are complying with all legal requirements when preparing your profit and loss statement. It is indeed important to adhere to legal guidelines to avoid legal consequences.
First and foremost, I want to assure you that you are not alone in this concern. Many entrepreneurs feel unsure when it comes to the legal requirements for preparing financial documents. Therefore, it is good that you are thinking about this and want to ensure that everything is correct and compliant with the law.
When preparing a profit and loss statement, there are indeed a variety of legal requirements that must be observed. In Germany, these requirements are set out in the Commercial Code (HGB). Among other things, the principles of proper accounting (GoB) are regulated there, which also apply to the preparation of profit and loss statements.
One important aspect, for example, is the completeness and accuracy of the information in the profit and loss statement. All relevant income and expenses must be recorded to obtain a correct picture of the company's results. In addition, accounting standards must be followed to meet legal requirements.
Furthermore, there are specific requirements for the structure and presentation of the profit and loss statement. These are specified in the HGB and should be considered when preparing to ensure a uniform and comprehensible presentation.
It is advisable to consult a tax consultant when in doubt or dealing with complex issues to ensure compliance with the law. I am happy to provide you with individual advice and support in preparing your profit and loss statement.
I hope that my explanations are helpful to you and I am available for any further questions.
Best regards,
Fanni Ehrig, Tax Consultant
