Germany

As a member of the European Union (EU), Germany is subject to accounting, auditing, and financial reporting requirements established in EU Regulations and Directives as transposed into national laws and regulations. Germany’s legal and regulatory framework for corporate reporting is principally set out in the German Commercial Code and related legislation, together with directly applicable EU law governing the use of International Financial Reporting Standards (IFRS) and statutory audit.

The financial reporting framework in Germany is primarily established by the German Commercial Code. Under EU Regulation No. 1606/2002, companies whose securities are admitted to trading on a regulated market are required to prepare consolidated financial statements in accordance with IFRS Accounting Standards as adopted by the EU. Other entities generally prepare financial statements in accordance with the German Commercial Code and related national requirements. Germany has therefore retained a differentiated reporting framework in which EU-endorsed IFRS apply to listed consolidated financial statements, while national requirements continue to govern most other entities. Germany has not adopted the IFRS for Small and Medium-sized Entities.

The Deutsches Rechnungslegungs Standards Committee (DRSC) is the recognized national standard-setter and represents Germany in international accounting standard-setting discussions. It supports the development of German accounting recommendations and interpretations and contributes to accounting policy discussions at both the national and EU levels.

Statutory audit requirements in Germany are established through the Public Accountant Act and related legislation implementing the EU audit reform framework, including Directive 2006/43/EC as amended by Directive 2014/56/EU and Regulation (EU) No. 537/2014 for public interest entity audits. Germany has not expanded the EU definition of public interest entities beyond the categories established in the Directive.

Audits in Germany are conducted in accordance with auditing standards issued by the Institut der Wirtschaftsprüfer in Deutschland e.V. (IDW). The German auditing framework is based on International Standards on Auditing as issued by the International Auditing and Assurance Standards Board and translated for application in the jurisdiction, supplemented where necessary by German-specific requirements. These standards are issued as ISA [DE].

Germany operates a differentiated system of public oversight for statutory audit. The Abschlussprüferaufsichtsstelle (APAS) is responsible for the independent public oversight of auditors and audit firms that perform audits of public interest entities and also oversees the Wirtschaftsprüferkammer (WPK) in relation to its regulatory responsibilities for the wider profession.

In Germany, the regulated segment of the profession is the statutory audit profession. The profession is governed principally by the Public Accountant Act, which establishes the legal framework for the approval, registration, supervision, and discipline of auditors and audit firms. The protected professional titles are Wirtschaftsprüfer and vereidigte Buchprüfer, although the latter designation is no longer granted to new entrants.

Entry into the profession is regulated under the Public Accountant Act and related examination regulations. Appointment as a Wirtschaftsprüfer requires successful completion of the professional examination. The Wirtschaftsprüferkammer (WPK) is responsible for administering the examination process and supporting the appointment procedure. The examination is conducted on a nationwide basis and consists of written and oral components.

Once appointed, Wirtschaftsprüfer are authorized to conduct statutory audits and other assurance engagements. They may also provide tax advice, represent clients in tax matters, act as experts in business management matters, serve as trustees, and provide legal advice where this is directly connected to their professional duties. In carrying out their work, they are required to comply with professional duties including independence, confidentiality, conscientiousness, and personal responsibility.

The WPK operates as the statutory professional body under public law. It is responsible for the appointment of auditors, recognition of audit firms, maintenance of the professional register, registration of statutory auditors, monitoring of continuing professional development, disciplinary oversight, quality assurance for non-public interest entity audit work, and other regulatory functions assigned under the Public Accountant Act.

Germany applies a shared regulatory model. Public oversight is exercised by the Abschlussprüferaufsichtsstelle (APAS), established at the Federal Office for Economic Affairs and Export Control. APAS exercises public oversight over the WPK and is responsible for oversight of statutory audits of public interest entities, including inspections, enforcement, and market monitoring. It also has ultimate oversight responsibility for key regulatory functions carried out by the WPK.

In addition to the statutory regulatory framework, the Institut der Wirtschaftsprüfer in Deutschland e.V. (IDW) operates as the principal voluntary professional accountancy organization for auditors in Germany. It supports the profession through technical guidance, education, and continuing professional development and plays a central role in issuing auditing standards for application in the jurisdiction.

Accounting standard-setting in Germany is carried out by the Deutsches Rechnungslegungs Standards Committee (DRSC), which is recognized as the national standard-setter. Its responsibilities include developing recommendations on group financial reporting, advising the government on legislative matters in financial reporting, representing Germany in international standard-setting fora, developing interpretations relating to International Financial Reporting Standards, enhancing the quality of financial reporting, and promoting research and education in these areas.

Independent public oversight of the audit profession in Germany is established under the Public Accountant Act and the Auditor Oversight Reform Act, which implemented the European Union audit reform framework in national law.

The Abschlussprüferaufsichtsstelle (APAS), established at the Federal Office for Economic Affairs and Export Control, is the independent public oversight authority for the audit profession. APAS is responsible for the public oversight of auditors and audit firms that perform statutory audits of public interest entities. Its functions include inspections, enforcement, market monitoring, and cooperation with European and international supervisory bodies.

APAS also exercises public professional oversight over the Wirtschaftsprüferkammer (WPK). In that role, it oversees the WPK’s regulatory activities and is indirectly responsible for the quality of statutory audits of all other entities outside the public interest entity segment.

APAS participates in international regulatory cooperation and forms part of the European audit oversight architecture, including cooperation through the Committee of European Auditing Oversight Bodies.

This oversight framework reflects a shared model in which APAS serves as the independent public oversight authority, while the WPK continues to carry out certain regulatory functions for auditors and audit firms outside the public interest entity segment under APAS supervision.

Institut der Wirtschaftsprüfer in Deutschland e.V. (IDW)

The IDW is a voluntary professional accountancy organization representing Wirtschaftsprüfer, audit firms, and other members of the audit profession in Germany. The institute traces its origins to 1932 and operates as the principal voluntary professional body for the statutory audit profession. Its activities focus on supporting the development of the profession through technical guidance, professional education, continuing professional development, and the issuance of auditing and assurance pronouncements for application in the jurisdiction. In addition, the IDW contributes to professional debate and standard-setting developments at the national, European, and international levels.

The IDW is a founding member of the International Federation of Accountants and a founding member of Accountancy Europe.

Wirtschaftsprüferkammer (WPK)

The WPK is the statutory professional body established under the Public Accountant Act. Membership is mandatory for all Wirtschaftsprüfer, vereidigte Buchprüfer, statutory audit firms, and certain accounting firms. The WPK is responsible for key regulatory functions assigned by law, including maintaining the professional register, administering entry and appointment procedures, recognizing audit firms, monitoring continuing professional development, carrying out quality assurance reviews for non-public interest entity audits, and administering investigation and disciplinary procedures within its remit.

The WPK is a member of the International Federation of Accountants and Accountancy Europe.

Both organizations play complementary roles within the profession. The IDW serves as the principal voluntary professional body with a strong role in technical support, standard-setting, and professional development, while the WPK serves as the statutory chamber with mandatory membership and regulatory responsibilities established by law.

Germany’s quality assurance (QA) review system is established under the Public Accountant Act and operates on a differentiated basis for all statutory audits. The Abschlussprüferaufsichtsstelle (APAS) is responsible for inspections of auditors and audit firms that perform statutory audits of public interest entities, while the Wirtschaftsprüferkammer (WPK), through its quality assurance system, is responsible for QA reviews of statutory audits outside the public interest entity segment under APAS oversight.

The framework is operational and covers all mandatory audits. The WPK states that its QA review system is subject to APAS public professional oversight and that APAS has ultimate decision-making authority over quality assurance decisions. Accordingly, the jurisdiction-level framework appears aligned with the main requirements of Statement of Membership Obligations 1.

At the standard-setting level, Germany has moved from quality control to quality management standards. The Institut der Wirtschaftsprüfer in Deutschland e.V. (IDW) issued IDW QMS 1 (September 2022) and IDW QMS 2 (September 2022), which are aligned with International Standard on Quality Management 1 (ISQM 1) and International Standard on Quality Management 2 (ISQM 2), respectively. The IDW also issued ISA [DE] 220 (Revised). Mandatory application of these standards became effective for audits of financial statements for periods beginning on or after 15 December 2023, with early application permitted.

Based on the 2026 adoption definitions, the QA framework is assessed as Adopted, as a QA review system incorporating the requirements of SMO 1 is established and operational for all mandatory audits, and the relevant quality management standards are adopted and effective.

ISQM 1 and ISQM 2 are adopted in Germany through IDW QMS 1 (09/2022) and IDW QMS 2 (09/2022), effective from 15 December 2023.

Current Status: Adopted

Initial and continuing professional development requirements for the statutory audit profession in Germany are established under the Public Accountant Act, the Auditor Examination Directive, and the professional bylaws of the Wirtschaftsprüferkammer (WPK). Entry routes to the profession include university-based pathways under the Public Accountant Act, followed by professional examination and appointment by the WPK. Official WPK guidance indicates that candidates generally complete at least three years of practical experience after at least eight semesters of study, or at least four years after fewer than eight semesters, with at least two years in audit for the main pathways.

The WPK is responsible for the professional examination process. The examination is held nationwide, consists of written and oral components, and may be shortened in certain circumstances permitted by law. Germany also provides an aptitude test route for statutory auditors already approved in another European Union or European Economic Area state or in Switzerland.

Continuing professional development requirements are established at the jurisdiction level. The WPK professional bylaws provide that continuing professional development should not be less than 40 hours annually, of which 20 hours must be structured learning, with the remainder permitted through other qualifying activities including self-study. The Institut der Wirtschaftsprüfer in Deutschland e.V. (IDW) also requires 40 hours of continuing professional development annually for members in active professional practice.

Germany does not appear to adopt the International Education Standards (IES) through a single formal incorporation by title and version. However, based on the current legal and professional framework, the jurisdiction-level requirements for entry, practical experience, assessment, and continuing professional development appear aligned with the revised 2019 IES, including the 2021 revisions in effect at the time of the assessment. Accordingly, the framework appears aligned with the relevant requirements of SMO 2.

Based on the 2026 adoption definitions, the IES framework in Germany is assessed as Adopted, as the jurisdiction-level requirements for aspiring and professional statutory auditors appear to meet the extant IES requirements in effect as of the time of the assessment.

Current Status: Adopted

Statutory audit requirements in Germany are established under the German Commercial Code and the European Union audit framework. Although the European Commission has not formally adopted ISA for use across the European Union, applicable auditing standards in Germany are issued by the Institut der Wirtschaftsprüfer in Deutschland e.V. (IDW).

Germany applies International Standards on Auditing through ISA [DE], which comprise the German translations of ISA supplemented by jurisdiction-specific requirements necessary to reflect German and European Union legal and reporting requirements. The IDW and the Wirtschaftsprüferkammer (WPK) confirm that ISA [DE], together with limited remaining IDW auditing standards addressing matters without an ISA equivalent or specific legal reporting requirements, constitute German generally accepted auditing standards. ISA [DE] have been applicable for audits of all financial statements since 15 December 2022.

Germany continues to incorporate current revisions, including ISA [DE] 220 (Revised) and ISA [DE] 600 (Revised), as well as related quality management standards. The jurisdiction-level framework therefore appears aligned with the relevant requirements of SMO 3.

Accordingly, based on the 2026 adoption definitions, ISA in Germany are assessed as Adopted, as ISA in their entirety are applied through ISA [DE] for all mandatory audits, with additional jurisdiction-specific requirements that are more stringent where necessary.

ISA for Less Complex Entities is not adopted in Germany. Instead, the IDW has issued separate standards for audits of less complex entities, which does not affect the overall adoption assessment.

Current Status: Adopted

Ethical requirements for the statutory audit profession in Germany are established under the Public Accountant Act and the German Commercial Code, which provide the legal basis for professional conduct, independence, and disciplinary obligations applicable to Wirtschaftsprüfer.

Under this framework, the Wirtschaftsprüferkammer (WPK) is authorized to issue detailed ethical requirements through its professional bylaws (Berufssatzung für Wirtschaftsprüfer/vereidigte Buchprüfer). These bylaws, together with applicable European Union independence requirements under Regulation (EU) No. 537/2014, constitute the jurisdiction-level ethical framework for the profession.

The WPK reports that it performs regular gap analyses between its ethical requirements and the International Code of Ethics for Professional Accountants (including International Independence Standards). According to WPK information, the German ethical framework reached convergence with the 2020 version of the Code in combination with the European Union Audit Regulation, with further revisions relating to the 2022 version, including public interest entity and listed entity provisions, expected to be completed by the end of 2024.

Recent WPK publications also confirm continued monitoring of the latest revisions, including the 2024–2025 sustainability and external expert ethics standards.

Accordingly, based on the 2026 adoption definitions, the jurisdiction is assessed as Partially Adopted, as the ethical framework is based on a post-2018 version of the Code and appears substantially aligned with SMO 4, but full adoption of the latest Code in effect as of the time of assessment cannot yet be conclusively demonstrated.

Current Status: Partially Adopted

Public sector accounting in Germany is determined by separate legal and regulatory frameworks at the federal, state, and local levels rather than by a single national public sector accounting standard-setter. The Budgetary Principles Act permits accrual-based approaches, but the federal government continues to use cash-based budgetary accounting, while practices at the state and municipal levels remain mixed.

Germany has not adopted IPSAS for application in the jurisdiction. Available sources indicate that public sector accounting frameworks used by German states and municipalities are generally based on national public law requirements and, where accrual approaches are used, are influenced more by German commercial accounting concepts than by IPSAS. Germany has also remained cautious toward formal IPSAS adoption in light of the European Public Sector Accounting Standards initiative.

Current Status: Not Adopted

Germany’s investigation and discipline (I&D) framework for the statutory audit profession is established under the Public Accountant Act and is operational for all members of the profession. The Wirtschaftsprüferkammer (WPK) is responsible for monitoring compliance with professional obligations and may impose disciplinary measures where breaches are identified. Available sanctions range from reprimands and monetary penalties to temporary prohibitions in certain professional fields and exclusion from the profession.

For breaches connected with statutory audits of public interest entities, responsibility lies with the Abschlussprüferaufsichtsstelle (APAS). APAS also exercises public professional oversight over the WPK’s disciplinary activities. This creates a differentiated jurisdiction-level framework under which WPK handles the broader profession and APAS is directly responsible for the public interest entity segment.

Members may object to disciplinary measures, and unresolved cases may be brought before the professional courts. The appeal structure comprises the Chamber for Wirtschaftsprüfer matters at the Regional Court of Berlin in first instance, the Senate for Wirtschaftsprüfer matters at the Higher Regional Court of Berlin in second instance, and the Federal Court of Justice in third instance. The framework therefore includes an appeals mechanism separate from the initial disciplinary decision-maker.

The WPK also publishes final disciplinary measures and an annual report on professional oversight, and it carries out ongoing formal reviews of published financial statements and audit reports outside the public interest entity segment. These features support public interest transparency and information-based initiation of cases, in addition to complaint-based procedures.

Based on the 2026 adoption definitions, Germany’s I&D framework is assessed as Adopted, as an I&D system is established and operational for all professional accountants within the regulated profession. The jurisdiction-level framework appears aligned with the main requirements of SMO 6.

Current Status: Adopted

Germany’s financial reporting framework is established under the German Commercial Code and directly applicable European Union legislation. Under Regulation (EC) No. 1606/2002, companies whose securities are admitted to trading on a regulated market are required to prepare consolidated financial statements in accordance with IFRS Accounting Standards as adopted by the European Union. This requirement also applies to entities in the process of being listed on a regulated market.

Accordingly, IFRS are adopted at the jurisdiction level for all domestic publicly accountable entities required to prepare consolidated general purpose financial statements. For non-listed and other entities, financial reporting is generally based on the German Commercial Code and German GAAP. Germany therefore operates a differential reporting framework in which IFRS are mandatory for listed consolidated financial statements and national standards continue to apply to most other entities.

The Deutsches Rechnungslegungs Standards Committee (DRSC) is the recognized national accounting standard-setter and supports the development of German accounting recommendations and interpretations, while IFRS adoption for listed entities follows the European Union endorsement mechanism.

Based on the 2026 adoption definitions, IFRS in Germany are assessed as Adopted, as IFRS Accounting Standards in effect as of the time of the assessment are required to be applied by all domestic publicly accountable entities in consolidated general purpose financial statements. The jurisdiction-level framework is therefore aligned with the relevant benchmark for Statement of Membership Obligations 7.

IFRS for Small and Medium-sized Entities are not adopted in Germany. Germany continues to apply the German Commercial Code as the reporting framework for entities without public accountability, and this does not affect the overall IFRS adoption assessment.

Current Status: Partially Adopted

Relevant Organizations

Abschlussprüferaufsichtsstelle (APAS)

Deutsches Rechnungslegungs Standards Committee (DRSC)

Institut der Wirtschaftsprüfer in Deutschland e.V. (IDW)

International Financial Reporting Standards Foundation, Jurisdictional Profile: Germany / European Union

Wirtschaftsprüferkammer (WPK)

Relevant Legislation

Berufssatzung für Wirtschaftsprüfer/vereidigte Buchprüfer (BS WP/vBP)

Budgetary Principles Act (Haushaltsgrundsätzegesetz)

German Commercial Code (Handelsgesetzbuch – HGB)

Public Accountant Act (Wirtschaftsprüferordnung – WPO)

Regulation (EC) No. 1606/2002 on the application of IFRS

Regulation (EU) No. 537/2014 on statutory audits of public interest entities

Relevant Publications

DRSC, Comment letter on IFRS 18 endorsement and implementation developments

IDW, Factsheet: IPSAS as a reference framework for EPSAS?

IDW, Public Sector Financial Reporting in Germany

IDW, Tätigkeitsbericht 2024–2025

WPK, Annual Report 2024

WPK, Professional Oversight Report 2024