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For internal accounting, the activity statement sheet I was already presented as an overview of the distribution of cost elements to cost centers and the product profit and loss account, which
was developed from the activity statement sheet II. You have obtained your data from activity reporting for cost units and responsibility reporting for the cost centers. To sections 3.7.3 and
3.7.4. will be referred. If this format is to be applied, the data would be compared according to the following pattern:
Fig. 102: Column format of the reporting
(Source: own illustration)
This would require corporate planning for the following year and regular updating of planning from the previous year for the current year. The motivation of small entrepreneurs for this planning is currently not very pronounced.
The German formats of the balance sheet, income statement and cash flow statement presented in Sections 5.2.1 to 5.2.3 are characterized by a rigid structure. By contrast, IAS 1 and 7 only provide a rough overview of these evaluations. The companies should then subdivide these main headings on their own responsibility according to the positions which are essential for their activity. This international approach leads to more informative value than if company-specific processes were compressed into a rigid form.
For the balance sheet, the central distinction between fixed and current assets, equity and debt capital must be made. In the income statement, the most important distinctions are sales, variable operating expenses, personnel expenses, depreciation, fixed expenses, interest income, interest expenses and taxes. Here, only the variable and fixed operating expenses can be usefully broken down. In the cash flow statement, the minimum classification is the distinction between cash flows from operating activities and from investment and financing activities. The in section 5.2.5. Proposed subdivision of operating cash flow is sufficiently meaningful. On the other hand, the investment and financing activities should be presented in a much more compact way.
The direct method suits the small business owners, because they record their business transactions predominantly from the cash flows.