Statutory vs Management

Statutory vs management accounts in Germany: HGB annual accounts and the BWA

German businesses run two parallel reporting streams: the statutory annual accounts under HGB, prepared once a year for the outside world, and internal management accounts, most visibly the monthly BWA, used to steer the business. This page compares their purpose, audience and timing.

Statutory accounts: for the outside world

The Jahresabschluss under HGB (the Bilanz, GuV, and for larger entities the Anhang and Lagebericht) is a legal, standardised, once-a-year document. Its audience is external: shareholders who adopt it (§ 42a GmbHG), creditors, the tax office and the public via the Unternehmensregister (§ 325).

Its rules are fixed by statute (§§ 242, 264), it applies HGB measurement, and for medium and large corporations it is audited by a Wirtschaftsprüfer (§ 316).

Management accounts and the BWA: for steering

Management accounts have no statutory form. The most common German artefact is the BWA (Betriebswirtschaftliche Auswertung), a monthly management report produced from the bookkeeping, often in a standard layout. It shows revenue, costs and a provisional result month by month, plus whatever KPIs the business chooses.

The BWA is internal, timely and flexible, but it is not filed, not audited and not a legal document. It exists to help managers make decisions, not to discharge an obligation.

Point by point

The same books, two very different reports.

Purpose

Statutory accounts discharge a legal duty and set the distributable profit. Management accounts inform decisions and let managers act early on trends the annual set will only confirm at year-end.

Audience

Statutory accounts are read by shareholders, creditors, the tax office and, once filed, the public. Management accounts and the BWA stay with directors and internal managers.

Frequency

The statutory Jahresabschluss is annual. The BWA is usually monthly, sometimes weekly, giving a running view long before the year-end statement is prepared.

Rules

Statutory accounts follow fixed HGB formats (§ 266, § 275). Management accounts have no prescribed layout, so the business shapes them to whatever is useful.

How they relate

Both draw on the same bookkeeping and chart of accounts, typically an SKR chart. The monthly BWAs across a year roll up towards the annual result, so they are not disconnected.

But the Jahresabschluss then applies year-end HGB measurement: provisions (§ 249), depreciation (§ 253 Abs. 3), accruals and deferrals, and valuation write-downs that a running BWA does not carry. That is why the audited annual profit rarely equals the sum of the monthly BWAs.

Which do you need when?

  • Filing, dividends, tax and bank covenants call for the statutory HGB accounts.
  • Monthly steering, budgeting and board updates call for management accounts or the BWA.
  • Both are built from the same ledger; only the statutory set is filed.
  • Only the statutory set, and only for medium and large entities, is audited (§ 316).
  • The BWA is provisional; the Jahresabschluss is the year-end truth after HGB measurement.

Frequently asked questions

What is a BWA?

A Betriebswirtschaftliche Auswertung is a monthly management report generated from the bookkeeping, showing revenue, costs and a provisional result. It is internal only and not a statutory document.

Is the BWA the same as the annual accounts?

No. The BWA is an internal monthly view. The Jahresabschluss is the once-a-year statutory HGB statement, adjusted at year-end for provisions, depreciation and valuation, and then filed.

Are management accounts filed in Germany?

No. Only the statutory HGB annual accounts are filed at the Unternehmensregister (§ 325). Management accounts and the BWA stay internal.

Why doesn't the sum of my monthly BWAs equal the annual profit?

Because the year-end statutory accounts apply HGB measurement, such as provisions, depreciation, accruals and write-downs, that the running BWA does not, so the two figures differ.

Do I need both?

Most companies do: management accounts to run the business month to month, and the statutory Jahresabschluss to meet the legal filing, dividend and tax obligations.