DPR audit

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Audits carried out by the German Financial Reporting Enforcement Panel [Deutsche Prüfstelle für Rechnungslegung (DPR)] include all capital market-oriented companies whose securities in the meaning of § 2(1) sentence 1 of the German Securities Trade Act [WpHG] are admitted to trading on the regulated market of a German stock exchange.

Audits are conducted in a two-step examination process with the aim of preventing irregularities in the preparation of company financial statements and other reports.
 

Step 1:

DPR responsible procedure
 

Step 2:

In cases prescribed by law, the procedure directly operated by the Federal Financial Supervisory Authority [BaFin].
 
The focus is always on the consolidated financial statements prepared in accordance with IFRS because of their significance to capital market players. Overall, the enforcement regime applies to the following reports:
  • The most recently adopted consolidated financial statements and the related management report, both prepared in accordance with IFRS
  • The most recently adopted annual financial statements and management report
  • The most recently published abbreviated financial statements and interim management report
     
A DPR audit is usually composed of 2 to 4 written question rounds and is spread out over several months, in some cases, even a year.
 

Overview of the DPR audit process

1. Causes for audit:

  • Examination with cause
  • BaFin request
  • Random sampling examination
     

2. Initiation of audit

  • Written notification of the audit from the panel
  • Request for documents (financial statements to be audited, including management report; audit reports or auditor's summary report; list of unadjusted audit differences; statement from company management that unadjusted audit differences are insignificant)
  • Statement on the willingness to cooperate from the company and appointment of a contact person
     

3. Audit process

  • Queries from responsible panel auditor following written explanations to certain issues and their balance sheet assessment
  • Request for agreements, expert opinions, financial statement documentation and protocols
  • Preparation of a company questionnaire by the panel auditor
  • Conduction of 2 to 4 question rounds, depending on the complexity of the audit subject
  • If it is determined that the selected accounting method does not comply with the required accounting principles, the company will receive a preliminary error assessment
  • A detailed response from the company
  • The detailed response gives the company an opportunity to justify the adopted accounting policy
     

4. Conclusion of audit

  • Audit is concluded without any objections
  • The Chamber decides that the financial statements are inaccurate
  • The decision that the financial statements are inaccurate is made under reservation
     

Rödl & Partner's assistance with DPR audits

We will gladly inform you about the content and procedure of the DPR / enforcement process and about possible “preventive” company measures. Thus, ongoing documentation and the keeping of records regarding the focal audit points of DPR and further special matters can contribute to timely, efficient responses when answering DRP questions. Throughout the entire audit period, central project management and an exact delegation of tasks among the involved employees is recommended.
 
We will also gladly assist you throughout all the phases of the DPR / enforcement process, including e.g. the preparation or review of individual responses to the DPR questionnaires. In this way, our specialists can help optimise the audit process and resource requirements also in complex matters.
 
In case of an error assertion, we are an experienced point of contact for the imminent adjustments to the current accounting system. Based on the follow-up work of the DPR process, we develop a specific catalogue of measures with a timetable, to sustainably remedy shortcomings and eliminate defects.
 
Based on evaluation of the DPR process, we develop a specific catalogue of measures, including a timetable, to sustainably remedy shortcomings and eliminate defects.
 

Contact

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Martin Wambach

Managing Partner, Chief Digital Officer

+49 221 9499 091 00
+49 221 9499 099 00

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Christian Landgraf

Partner

+49 911 9193 2523
+49 911 9193 8523

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