HGB fundamentals
Organizations in Germany prepare consolidated financial statements (Konzernabschluss) under HGB. The Konzernabschluss must present a true and fair view of the net assets, financial position, and results of operations of the group (§297 Abs. 2 HGB).
Consolidation obligation (§290, §293 HGB)
The obligation to prepare consolidated financial statements arises from the control relationship under §290 HGB — not from size thresholds.
Rule |
HGB reference |
Requirement |
|---|---|---|
Obligation trigger |
§290(1) HGB |
A parent must prepare consolidated financial statements where it can exercise a controlling influence over another company. |
World-wide principle (Weltabschlussprinzip) |
§294(1) HGB |
All subsidiaries must be included regardless of registered seat or legal form. |
Size-based EXEMPTION |
§293(1) HGB (2024 thresholds) |
A parent may be EXEMPT if the group meets at least 2 of 3 criteria on 2 consecutive balance sheet dates: balance sheet total ≤ €30M; revenue ≤ €60M; average employees ≤ 250. This is an exemption from the obligation — not a trigger for it. |
Inclusion exceptions (§296) |
§296 HGB |
A subsidiary may be excluded only in narrow cases: severe and lasting restrictions; disproportionately high cost; shares held exclusively for resale; or of minor importance. |
Note: The §293 thresholds are a size-based EXEMPTION — they do not trigger the consolidation obligation. The obligation arises from control under §290 HGB.
Goodwill and negative badwil (§§301, 309, 253 HGB)
Goodwill is amortized on a scheduled basis over its useful economic life (§309(1) i.c.w. §253(3) HGB).
If the useful life cannot be reliably estimated: amortize over 10 years (§253(3) Satz 3–4 HGB) — a defined default, not a maximum.
Negative goodwill (Unterschiedsbetrag) — shown after equity on the Konzernbilanz (§301(3) HGB); released to income only under §309(2) HGB conditions.
No deferred tax on the goodwill or negative goodwill difference itself (§306 Satz 3 HGB).
Note: HGB goodwill amortization period and negative goodwill treatment must be confirmed with a HGB-qualified accountant before configuration.
Currency translation (§308a HGB)
Account type |
Rate applied |
§308a HGB rule |
|---|---|---|
Assets and liabilities |
Closing rate (Stichtagskurs) |
§308a HGB |
Equity (except current period result) |
Historical rate — rate at the date each equity component originally arose. Not the opening rate of the current period. Fixed permanently. |
§308a HGB |
P&L accounts |
Average rate (Durchschnittskurs) |
§308a HGB |
Translation difference |
Eigenkapitaldifferenz aus Währungsumrechnung — posted within equity after reserves. Not OCI. |
§308a HGB |
Note: Opening rate ≠ Historical rate. The historical rate under §308a HGB is the rate at the original date each equity component arose — fixed permanently. Do not use the opening rate for equity accounts.
Mandatory consolidated financial statements (§297(1) HGB)
Statement |
German term |
HGB reference |
Status in Lineos |
|---|---|---|---|
Consolidated balance sheet |
Konzernbilanz |
§297(1) HGB |
Covered |
Consolidated income statement |
Konzern-GuV |
§§297(1), 275 HGB |
Covered (GKV and UKV) |
Notes to the consolidated accounts |
Konzernanhang |
§§297(1), 313, 314 HGB |
Outside engine — manual |
Consolidated cash flow statement |
Kapitalflussrechnung |
§297(1) HGB, DRS 21 |
Confirm with Paul |
Consolidated statement of changes in equity |
Eigenkapitalspiegel |
§297(1) HGB |
Confirm with Paul |
Group management report |
Konzernlagebericht |
§315 HGB |
Outside engine — manual |