Management Forecast Regulation and Practice in Germany – Firm and Auditor Perspectives

Thorsten Knauer and Andreas Wömpener

Accounting in Europe, 2011, vol. 8, issue 2, 185-209

Abstract: The German regulation on future-oriented reporting is unique in the international context. Its scope is extensive and it specifically pertains to a two-year time horizon in the management forecast section of the annual report. The goal of our research is to provide insights into the perspectives of forecasters on the one hand and auditors on the other, as well as to contrast their viewpoints in order to promote the regulatory debate. Applying the multiple case study method, we exploratively interview forecasters and auditors in order to extract perspectives on the regulation itself, the forecasting process and their mutual relationship. Our main results show that the auditing of forecasts is a regular cause of friction and that most firms and auditors are dissatisfied with the current regulation. In particular, its concreteness and detail are criticised because the forecasting behaviour of firms is generally rather heterogeneous in practice. The management of small enterprises and auditors of smaller firms seem to view management forecasts even more critically. Our research provides evidence for the ongoing regulatory discussion in the German and international contexts and allows for greater insight for both auditors and forecasters into the viewpoints of their respective counterparts.

Date: 2011
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
http://hdl.handle.net/10.1080/17449480.2011.621398 (text/html)
Access to full text is restricted to subscribers.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:taf:acceur:v:8:y:2011:i:2:p:185-209

Ordering information: This journal article can be ordered from
http://www.tandfonline.com/pricing/journal/RAIE20

DOI: 10.1080/17449480.2011.621398

Access Statistics for this article

Accounting in Europe is currently edited by Lisa Evans

More articles in Accounting in Europe from Taylor & Francis Journals
Bibliographic data for series maintained by Chris Longhurst ().