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Organisation and Objectives

 

 

1 Overview
2 The ASCG
2.1 General Information
2.2 Objectives of the ASCG
2.3 The Governing Bodies and Standing Committees of the ASCG
2.3.1 The General Assembly
2.3.2 The Administrative Board
2.3.3 The Nomination Committee
2.3.4 The Executive Committee
2.3.5 The IFRS and German GAAP Committees
2.3.6 The Academic Advisory Board





1. Overview

In November 1995, the European Commission passed its accounting strategy and, by doing so, set the course for the future accounting in Europe. Thereby, the stated goal is to develop a competitive European capital market. In context with these strategies, multiple measures were taken and statements were published in subsequent years.

The increasing importance of international capital markets for German companies and groups induced the German legislator already in 1998 to open up possibilities for an in-creased convergence of German Accounting Standards to international principles. To en-sure a greater flexibility for the further development of financial accounting and its fast ad-justment to new requirements, a private committee comprising independent experts should operate as desired by the legislator. This should advance the development of accounting principles as a function of autonomous administration by an independent standard setter. § 342 of the German Commercial Code (HGB) provides the legal basis for such an institution.

The Accounting Standards Committee of Germany (ASCG) was established as national standardisation organisation, which was recognised as private accounting committee ac-cording to § 342 of the German Commercial Code (HGB) by the Federal Ministry of Justice with contract of 3 September 1998. With the standardisation agreement of 2 December 2011, the Accounting Standards Committee of Germany (ASCG) was once again recog-nised as responsible standardisation organisation for Germany by the Federal Ministry of Justice. In its standardisation agreement, the ASCG commits to provide an independent accounting body (the committees), to pass it the tasks according to § 342 of the German Commercial Code and to finance it.

 


2. The ASCG

2.1. General Information

The Accounting Standards Committee of Germany (ASCG) was established in 1998 as standardisation organisation and has since then been the institution carrying the technical committees. The ASCG is a registered, not-for-profit association domiciled in Berlin.

 

 

2.2. Objectives of the ASCG

According to the Constitution of the ASCG, the association's work pursues the following :

  1. The objectives of the Association are, in the general economic interest,

    1. to develop recommendations for the application of principles for consolidated financial reporting;

    2. to provide advice on planned legislation on accounting regulations at national and EU level;

    3. to represent the Federal Republic of Germany in international accounting and financial reporting bodies;

    4. to develop Interpretations of the international accounting standards within the meaning of section 315a(1) of the German Commercial Code (HGB);

    5. to enhance the quality of accounting and financial reporting;

    6. to promote research and education in the above-mentioned areas.

  2. The Association serves the aims of its members under the Constitution within the framework of its own objectives. It fulfils its objectives as a professional association for its members.

  3. The Association acts in a non-profit capacity. The generation of profit is not its primary objective. It may only use revenue from the exploitation of its work for the objectives set out in the Constitution.

  4. The Association may establish business operations to implement and promote its objec-tives under the Constitution. It may also take out memberships and acquire equity in-vestments.

Since the association's foundation in 1998, the accounting environment has changed on a large scale. Even though the globalisation of accounting standards was already conceivable back then, the pace in which the change took place was underestimated. Especially the de-velopments at European level in recent years led to more effort on international tasks.

The ASCG finances its activities from membership fees and donations as well as licensing, publications and other revenues.

 


2.3. The Governing Bodies and Standing Committees of the ASCG

2.3.1 The General Assembly


The General Assembly, which takes place once a year, is amongst others responsible for electing, withdrawing, and dismissing the members of the Administrative Board and the Nomination Committee, determining the amount of the annual fee, the business plan, adopting the annual financial statements, and amending and supplementing the constitution.

All legal persons and all associations of persons that are subject to the statutory duty to prepare financial statements or that are involved in accounting and financial reporting may become a member of the Association. Because the membership structure is designed to represent the different interests of the parties involved in accounting and financial reporting in the general economic interest, each member is allocated to one of the following segments:

  • publicly traded industrial companies and associations (Segment “A”);

  • non-publicly traded industrial companies and associations (Segment “B”);

  • banks and associations (Segment “C”);

  • insurance undertakings and associations (Segment “D”);

  • the accounting and auditing profession and associations (Segment “E”).

 

2.3.2 The Administrative Board

The Administrative Board has 20 members who are elected by the General Assembly for a three-year term of office.

The members of the Administrative Board are elected by segment. The ten persons pro-posed who receive the most votes in the General Assembly are elected from the persons proposed by Segment A. The same applies to Segments B and D, except that in these cas-es the two persons who receive the most votes in the General Assembly are elected, and to Segments C and E, except that in these cases the three persons who receive the most votes in the General Assembly are elected.

The Administrative Board defines the principles and guidelines for the work of the Associa-tion, and in particular of the technical committees and the Executive Committee, taking the general economic interest into account. It elects the members of the technical committees; it appoints, advises and supervises the Executive Committee.


2.3.3 The Nomination Committee

The Nomination Committee comprises seven members who are elected by the General As-sembly. It has at least one representative of each segment (Article 4(1)), provided that at least one member is allocated to each segment. The members are elected by the General Assembly for a three-year term of office.

The Nomination Committee submits proposals to the Administrative Board for the election of the members of the Executive Committee and the technical committees.

 


2.4.4 The Executive Committee

The Executive Committee comprises the President and the Vice-President. The members of the Executive Committee are elected by the Administrative Board for three years at the proposal of the Nomination Committee.

The Executive Committee manages the business of the Association. The President and the Vice-President represent the Association and the technical committees and their work externally. They are the legal representatives of the Association in accord-ance with section 26 of the BGB.

 


2.4.5 The IFRS and German GAAP Committees

The IFRS and the German GAAP Committees are each composed of seven mem-bers with particular specialist expertise and experience in the field of accounting and financial reporting. They conduct their honorary activities independently in line with the principles and guidelines laid down by the Administrative Board. The technical committees are chaired by the president and vice president respectively without a right to vote.

Subject to a public consultation process, the technical committees develop the following technical statements, partly supported by the established working groups:

  • Interpretation of the international accounting standards according to § 315a of the German Commercial Code (HGB);

  • German Accounting Standards according to § 342 of the German Commercial Code (HGB);

  • comment letters to national and international addressee regarding accounting questions and

  • discussion papers, other comments and publications.

 

2.4.6 The Academic Advisory Board

The Administrative Board may establish an Academic Advisory Board that advises the technical committees without being a technical committee itself.

 

 

Important Documents

 

Articles of Govern Body

 


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