Sensible commercial assessment
Reasonable commercial assessment is often used as an indefinite legal term in the accounting law of the Commercial Code (HGB) and aims as an objectification criterion that in the accounting company on the basis of business knowledge within the scope of a judicially verifiable scope of assessment without the application of arbitrariness , and also objective expert third parties understand the assumptions made.
Use in the HGB and other laws
In German Commercial Code ( HGB) it is required that provisions be recognized in the amount of the settlement amount that is necessary according to prudent business judgment . The use of the indefinite legal term in the difficult matter of assessing the amount of uncertain liabilities is particularly explosive. However, it shows that it was important to the legislature not to restrict the scope of action of the accounting entrepreneur with this general formulation in particular when it comes to prognostic assessments. That's even with HGB for credit institutions the case, which is also intended for protection against the specific risks of the business branch of the banks assets at a low value than the lower of intended value rate allowed. This also applies to your equity , for which you may pass a special item for general banking risks (“Fund for general banking risks”) according to German Commercial Code .(1) of the
According to AktG , the management board of a stock corporation may refuse to provide information to the shareholders at the general meeting if it is capable of inflicting a not inconsiderable disadvantage on the company or an affiliated company .(3) No. 1
Subsidiary companies generally have to distribute their profits to the controlling company ( KStG ); as an exception, amounts from the annual surplus may only be transferred to the reserves to the extent that this can be economically justified on the basis of a reasonable commercial assessment.
Differentiation between judgment and discretion
The law specifically mentions a margin of appreciation that is legally to be distinguished from the margin of discretion . With regard to the scope of assessment, the legislature has formulated some facts indefinitely and extensively, so that the user of the law has a scope of assessment when subsuming a specific situation under the facts of the respective norm. The use of this scope for decision-making is desirable by law. However, the full extent of the scope for assessment can be checked in court, whereas the exercise of discretion can only be checked in court in the area of errors of assessment . However, the judicial review only takes place if legal action is taken against specific accounting business decisions.
The terms "reasonable" and "commercial"
What is to be considered "reasonable" is not defined in the law. However, the legislature assumes that business decisions are regularly based on rationally comprehensible criteria and that purely intuitive, subjective decision-making bases are avoided. The Federal Court of Justice uses the phrase “intelligent, economically sensible person” whenever someone is allowed to consider something to be useful and necessary. "Commercial" decisions are always when well-founded business decisions are made. The proper and conscientious assessment of a situation by a businessman, observing the duty of care in accordance with (1) sentence 1 AktG, is therefore “reasonable” and “commercial”.
Case law and literature
The case law has so far contributed little to the interpretation of the indefinite legal term, apparently it presupposes that the term is generally known. In any case, tax law must not go beyond the standard of a reasonable commercial assessment. It corresponds to a reasonable commercial assessment not only to record a situation that justifies a provision in its negative aspects, but also to take into account the positive features that reduce the likelihood of a claim or - at best - eliminate it, because the merchant is economically and legally unencumbered. The risk reduction as a result of an expected recourse claim against a third party may also have to be taken into account. According to the BFH , a reasonable commercial assessment requires a provision in the amount in which a claim can be expected on the balance sheet date. The businessman has to weigh up risks and opportunities against one another. The BFH has narrowed this margin of appreciation in the case of provisions to the effect that “more reasons must speak for it than against it” for the later occurrence of the obligation.
With regard to listed shares, there are different opinions in financial administration and literature as to when a permanent decrease in value can be assumed. In this regard, the tax authorities are of the opinion that, in the event of price changes in listed securities, only temporary reductions in value can generally be assumed. The BFH opposed this view in 2007 and assesses the question of a reasonable commercial assessment of the prognostic possibilities from the point of view of the balance sheet date . This is based on the idea that the stock market value reflects the views of market participants about the value of a share as an investment and thus the prices include the assessment of the company's future risks and prospects for success. This in turn has the consequence that on the specified reference date, the expectations of a large number of market participants about the future development of the price and the assessment that the price that has now been found are likely to be of a lasting nature. The accounting company could not be expected to have better prognostic capabilities than the market. As a result, it can be concluded from this that, in the case of listed shares that are held as a financial asset, a permanent decrease in value is to be assumed if the market value on the balance sheet date has fallen below the acquisition cost and at the time the balance sheet is drawn up there are no indications of an imminent increase in the price exist.
A sensible commercial assessment requires the "arbitrary and objective assessment and examination of the probability of an impairment occurring as well as the necessary value deduction". According to this, neither arbitrariness nor subjective ideas may flow into the evaluation of individual balance sheet items. The principle of prudent business judgment on the one hand restricts the scope of the precautionary principle in the sense of a general clause , on the other hand it creates a considerable and legally permitted freedom for the application of this precautionary principle.
According to Blasius, reasonable business judgment can only move within the limits of the general principle of prudence ; Arbitrariness or unjustified "excessive caution" should be prevented by the principle of reasonable commercial judgment. This means that a reasonable commercial assessment finds its limits in the arbitrary use of the legally permissible scope for decision-making and in the exaggerated application of the principle of prudence from (1) No. 4 HGB.
- Michael Raab: The "sensible commercial assessment" as an assessment technology in the preparation of annual financial statements under commercial law. A contribution for a way to interpret § 253 Abs. 4 HGB , 1991, ISBN 978-3-631-43778-0
- BGH judgment of February 14, 2006, Az .: VI ZR 126/05
- BFH judgment of December 12, 1990 IR 153/86, BFHE 163, 146, 155, BStBl. II 1991, p. 479
- BFH judgment of February 17, 1993 XR 60/89, BStBl. 1993 II, p. 437
- BFH judgment of April 6, 2000 IV R 31/99, BStBl. 2001 II, p. 536
- BFH judgment of February 15, 2006, BStBl. II 2006, pp. 749, 752
- BMF letter of February 25, 2000
- BFH judgment of September 26, 2007 (IR 58/06)
- Rainer Bossert / Ulrich L. Manz, External Corporate Accounting , 1996, p. 160
- Jürgen Rümmele, The Importance of Continuous Valuation for Accounting , 1991, p. 144
- Torsten Blasius, IFRS, HGB and R & E: Taxation and Accounting , 2006, p. 59, footnote 425