Annual financial statementsThe annual financial statements are drawn up at the end of a business year. It establishes the financial situation of a company. Thus, the company itself gets a summary of the balance sheet as well as profit and loss of last year. Apart from the information on the economic situation of the company,an annual financial statement also serves as a basis for distribution of results. Not all companies are obliged to publish the annual financial statements in the Federal Gazette. According to §1 para. 1 PublG the obligation for publications applies to all corporations, persons trading companies as well as companies with exceed a balance sheet total and sales revenues of 65 million Euros or 130 million Euros and more than 5,000 employees.
Authorized representativeThe power of procuration given by a merchant or a company to an employee is called Authorized representative. The procuration grants the employee’s power of action and serves as a support within the corporate management. The power of procuration is to be expressly given and has to be entered by the merchant in the commercial register. The power of act of authorized representative is not determined by law but can be decided individually by the company. If the act of authorized representative exceeds its authority to act, he acts as a representative without representation power according to §§177ff BGB. In this case the company shall be liable for the completed transaction. In-house, the authorized representative itself is liable for the damage occurring.
BoniCheck compactA creditworthiness shall be used to show the financial economy for an economic entity, in the sense of liabilities. Economic entities can be natural persons or companies. BoniCheck compact is a stripped-down version of the full range. It provides the most important facts at a glance. These can be for example:
- Financial position, includes credit rating index, payment experience, negative characteristics and maximum lending
- Legal form as well as business object
- Bank connection as well as business figures
BürgelThe company Bürgel with German roots has provided economic information for more than 130 years. Its services include the provision of creditworthiness information as well as requirement and address management services. Since 2016 Bürgel has been part of the globally operation CRIF Group which is using its credit and business information solutions for customers in more than 50 countries.
Business binding permissibilityA company agreement is created by the shareholders in the formation of a company. It usually includes the following points:
- Name and address of the company and its business object
- The duration of the company and the financial year
- Share capital
- Name of the management and representation
- Establishment of shareholder meetings, shareholders’ resolutions
- Definition of annual financial statements and results
- The disposal of business shares
- As well as the regulation of business shares or cost distribution in case of death, inheritance, dissolution etc.
Business figuresBusiness figures, also referred as business metrics, are the key figures used to assess the company. It is thereby a reproducible quantity with entrepreneurial importance which measures a repetitive state or process. The aim of a company is the successful implementation of a version or strategy. The business figures are intended to help business decisions and serve as a control.
Business objectA business object explained the business model of a company. This is compulsory in the company agreement of a limited liability company as well as in the articles of assocation of an AG and recorded in the commercial register. Example: The business object of a company may be the trading of computer parts of all kinds. To achieve this purpose, the company may establish branch companies or participate in similar or other companies.
CEO (Chief Executive Officer)CEO are persons who have been commissioned to pursue legal interests for a company, association or organization. They also bear the responsibility that the corporate purpose is achieved and the necessary actions are defined and carried out. In legal sense a CEO acts as a legal person because a CEO cannot act and decide as a natural person. Thus, the data which are published about a CEO, so the full name, date and place of birth, are not personal data.
Commercial registerThe information of registered company published by register portals is referred to a commercial register. This is publicly accessible to everyone and serves the publication, proof, control and protection function. The commercial register is usually managed by the relevant administrative courts. Usually, a commercial register maintains information about companies whose legal form as well as their offices and branches. Furthermore the subject matter of the company, the managing director(s) as well as basic and equity capital.
CreditworthinessA creditworthiness shall be used to show the financial economy for an economic entity, in the sense of liabilities. Economic entities can be natural persons or companies. Creditworthiness-Checks can contain the following information:
- Financial position, includes creditworthiness index, default probability, payment experience, negative characteristics and maximum lending
- Communication data, legal form, acting persons as well as company history
- Object of business, participations
- Bank details, business figures and balance sheets
- Real estate as well as other functions and participations
District CourtThe District Court is the court of first instance of ordinary jurisdiction. Its order and allocation in court district is subject to the federal states. The tasks of the district courts include civil and criminal matters. Civil affairs include commercial, cooperative, associations and register of goods. That is why it also be called register court.
Euler HermesEuler Hermes, a company with German roots has been service provider for debt management for almost 100 years. It is also the world leader in credit insurance and at the same time leading European group for liability insurance and claims management. With the help of Euler Hermes risks can be minimized in case of default and misappropriation. The main focus is on commodity credit insurance.
FinanceCheckWe receive our FinanceCheck from Bürgel. It is intended to provide an overview of the financial status of a company. The document typically includes the creditworthiness index and the assessment of the business relationship, which are determinded by the calculation methodology of Euler Hermes.
Function carriersFunction carriers are persons who are involved in the fulfillment of the company task by acting in organization units. Both, the functionaries and their representatives, are named in the company contract under management and representation.
InsolvencyA company, also known as a debtor, may apply for insolvency if the latter is no longer able to meet is payment obligations against creditor. Natural and legal persons can apply for insolvency. The purpose of insolvency is to generate as much assets as possible for the creditor as well as shareholders as many payment obligations as possible can be paid.
Insolvency administratorIn the event of insolvency an insolvency administrator is appointed by the insolvency court. Its task is first to sort the assets of the debtor (or insolvent company) according to their own and third resources. Own assets, also called insolvency assets, are equated with the open claims of creditors, in order to be able to satisfy as far as possible all claims.
Legal actA legal transaction consisting at least one declaration of intent to leads a legal order. Anyone who enters into a legal transaction enters into a contract with rights an obligations. A distinction must be made between the number of pages involved and the content: a unilateral legal transaction may be a termination, a double-sided purchase agreement and a multi-page legal transaction constitute the decision of a committee. According to contents the obligation or disposal can be divided.
Legal formThe legal form is a legally prescribed framework of companies with which they participate in economic life. At the same time the liability of the shareholders, size of company, capital requirements, publicity obligations etc are also fixed. Legal forms can include UG, GmbH, AG, OHG or KG.
LiquidationDuring a liquidation all assets of a company are sold. The aim is to convert the capital invested into cash so in order to obtain liquid funds. This step is necessary if a company is no longer able to pay and strives to the end. A liquidation is not to be confused with an insolvency and is represented during a bankruptcy only in a special form. Liquidation begins when a company is to be terminated or an application for insolvency is refused due to a lack of funds.
LiquidatorThe implementation of a liquidation is ordered by the management members and the managing director. This person is entrusted with the task of guiding the company to completion of the company’s existence. The task of the liquidator is to generate as much assets as possible for creditors and shareholders to terminate current business.
Register courtDistrict courts which includes the following register are also called register court: Commercial register, cooperative register, register of partnerships, association register and register of property registers. The central register of register court are managed by the federal office of justice in Bonn. In case of company formation and management, information is given on the establishment, modification or deletion of the respective companies. This information includes company name, legal form and seat of the company as well as information on the authorization to act, capital and business object.
Register numberCompanys have to register themselves in commercial register and will be given a register number which can be used to clearly identify them. According to the kind of company, the register numbers can begin with HRA, HRB but also VR (Association), PR (Partnership Register) or GenR (Cooperative Register). The A and B at HR stands for the departments. Usually only corporations (GmBH, AG, KGaA) are registered in Divison B.
Register reportA commercial register extract provides official proof of the identity of the company in its most recent version. Typically, a register report provides information on:
- Official company name
- Registered address
- Registration number and authority
- Date of registration
- Information about the management
- Names and identities of the officers and the signature right they hold
- Share capital (depending on the legal form)