Your company needs an early warning system for risks that could jeopardize its existence!

Are you a managing director or shareholder of a limited liability company (e.g. GmbH, AG, GmbH & Co. KG)?

Your answer is "No":
If you do not operate a limited liability company but, for example, a sole proprietorship or are a shareholder in a partnership
(e.g. GbR), you do not need to set up a risk early warning system.

However, since you are personally liable for the company's debts, it still makes sense to set up such a system.

You can use "Yes" is the answer:
Your company is legally obliged to introduce an early warning system for risks that could jeopardize its continued existence!

If the company becomes insolvent without such a system, this may result in liability for you as a managing director. If you are a shareholder, you may lose your share.

💡 This is a structured risk management system that allows you to keep an eye on market, credit, liquidity and operational risks on an ongoing basis and document the monitoring measures and their results.

In detail:

Identifying risks and monitoring key figures
- Systematic identification of risks (e.g. from the market, customers, suppliers, legal requirements, technology)
- Assessment of risks according to probability of occurrence
- Definition of threshold values for critical key figures (e.g. in the event of customer payment arrears)
- Automated or manual monitoring at fixed intervals
- Monitoring of IT and data protection risks by suitable personnel

Managing liquidity
- Liquidity planning for at least 12 months
- Definition of early warning indicators (e.g. equity ratio, debt ratio, cash flow)
- Revenue and cost planning with target/actual comparison

Set up preventive and immediate measures
- Action plan when critical values are reached and when critical situations occur
- Crisis level model (e.g. green / yellow / red) with clear instructions for action
- Definition of clear responsibilities for ongoing risk monitoring

Watch everything
- All risk management steps, decisions and assessments must be documented in a comprehensible manner

We tax consultants also always keep an eye on the risks described, for example in the context of the annual financial statements.

👉 Do you have detailed questions about risk management in your company? Please feel free to contact us!
We will be happy to advise you: www.wsb-berater.com/kontakt

#Risk management #Early warning system #Corporate security #TTax advice #Insolvency prevention #WSB