Consolidation Package (HB II and HGB)

HB II (Handelsbilanz II – German Standards)

getsix^® understands that companies belonging to capital groups prepare financial statements and consolidation packages containing financial information required by parent companies for preparation of a consolidated financial statement. Each of these packages have to be prepared according to the regulations applicable to a consolidated financial statement.

Our experts have wide experience in verification and confirmation of consolidation packages for (HB II – HGB) prepared in compliance with:

The Polish Accounting Act and other Polish regulations;

International Accounting Standards / International Financial Reporting Standards (IAS/IFRS);

US GAAP;

Capital Group principles.

Due to the number of customers for whom we have verified and validated consolidation packages getsix^® has gathered wide-ranging experience in relationships with parent company’s auditors, including foreign ones. We are fully aware of their requirements and expectations in relation to packages under preparation, along with knowledge about how consolidation packages look and what they shall include.

HGB (German Accounting Law) – Does it matter for Polish companies?

Notwithstanding the increasing popularity of the International Financial Reporting Standards (IFRS) in the financial reporting both in Europe and worldwide, local accounting principles still play a substantial role for many companies, particularly those not listed and not trying to be listed on stock exchange. getsix^® realises this applies not only to enterprises operating in developing economies such as Poland, but also in developed countries such as Germany.

The basic legal act which governs the functioning of enterprises and sets out accounting rules in Germany is called Handelsgesetzbuch (HGB) – the so-called ‘Commercial Code’, also historically referred to as the merchant law. HGB was created many years ago, but was revamped in 1998 to adapt it to modern business reality. German accounting law was renewed again in 2009 when a new act came into actuality, the so-called Bilanzrechtsmodernisierungsgesetz, or BilMog in short.

It may seem that understanding of the local German accounting law is unconnected for most businesses functioning in Poland. This of course is true on the condition that a Polish company has no equity links with any German entity. The opposite of this is when an enterprise in Poland belongs to a group established in Germany which compiles consolidated financial statements according to German accounting regulations (HGB). Poland is at present the most important business partner for Germany in this part of Europe and with Germany the second largest investor in Poland confirms that a lot of companies which operate in Poland but have foreign equity connections follow or should follow the HGB rules for group reporting. According to a survey led by the Polish-German Chamber of Industry & Commerce, as many as 94% of German groups operating in Poland declare that their entry to the Polish market was the correct decision and they would do it again if they had the same choice to make. Such a survey result may indicate that the investments of German companies in Poland will continue to grow in the future.

If you want to convert financial statements compiled according to the Polish Accounting Act into HGB statements, getsix^® will help you by paying attention not only to the issues set out explicitly in German law, but also to group guidelines. We will manage the equivalents of company accounting policies for your Polish business. We are well aware of the detailed rules of valuation and presentation of all assets and liabilities, as well as revenues and expenses within a group, insofar as HGB allows discretion. Therefore, a majority of variances between numbers disclosed in financial statements according to Polish regulations and those assembled under German regulations may stem from dissimilar valuation rules in a Polish subsidiary and its German parent company.

Thus, if your company belongs to a German group you can leverage the local and German knowledge and experience of getsix^®, as we know the German accounting law, so we are very familiar with differences in valuation and presentation of standard assets and liabilities, and revenues and expenses. Allowing getsix^® to carry out this work for you will for sure improve the communication to your shareholder/s, thus we also help you understand the requirements, which will certainly lead to a trusting and effective collaboration.

getsix^® aims to highlight important aspects and provide information to help companies prepare for the task of controlling subsidiaries abroad.

Our accounting and financial specialists remain at your service to answer all questions about anything regarding Accounting and Financial matters of your business at our offices in: Wrocław, Poznań, Warsaw and Szczecin.