Budgetary Principles Act (HGrG)

Utilise our know-how

For entities in which one or more local government authorities hold a majority share, the responsible entity body is to engage the auditor with expanding the audit under section 53 of the Budgetary Principles Act (Haushaltsgrundsätzegesetz – HGrG) if the local authorities request it. During the annual audit, the proper order of management is also to be examined, and the economic circumstances presented. This also applies to auditing local government enterprises and institutions under the relevant state legislation. Our range of responsibilities is described by IDW PS 720 “Berichterstattung über die Erweiterung der Abschlussprüfung nach § 53 HGrG [Reporting on Expansion of the Audit under Section 53 HGrG]”, which also provides the related audit checklist.

Expanding the audit engagement to include an audit of the proper order of management is disproportionately infrequent, what with the audit budget for public enterprises often being as small as it is. Is this a curse or an opportunity?

We absolutely think it’s an OPPORTUNITY! The commentary to the IDW PS 720 checklist, which is usually limited to fulfilling indicators and descriptions of proper use of funds, etc., is often the only way to provide and understanding to members of the supervisory bodies with no training in accounting or business of other matters or of any needs to take action. We hold talks on the subject, and once involved in the process, we often help solve problems.

We’ll offer you our support if you have any questions when developing advisory or audit plans or “just” to discuss particular issues. You will remain your client’s contact and problem solver. We’ll give you our support with our specialist knowledge and the specialist materials we have available.