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German to English translations [PRO] Bus/Financial - Accounting / annual report
German term or phrase:Rückstellung
This is a heading in the income sheet. Usually it is translated as "Provisions" (including in the XBRL for HGB, and in previous Kudoz answers), but sometimes it is given as "Accruals." Dietl gives "reserve; liability reserve; provision" or "reserve," but then: "American, accrued liabilities." These meanings are quite different in English. How can I make sense of this?
Explanation: For ANY German source accounting (HGB or IFRS), provision is the only correct translation. That said, I have at least one client who still insists on using "accruals". It's wrong, but der Kunde ist König.
The only time I could see using accrual would be in some academic writing that needs to be geared toward a US-GAAP audience, and even then, an informed reader would know what a provision is.
Thanks, Ted and Robin, for your invaluable help. (I realize now that I got "accruals" also from a TM sent to me by a previous client, so I thought it was probably reliable. Now I know that der Kunde ist König ... but, it's still wrong!) 4 KudoZ points were awarded for this answer
It's standard practice for additions to, utilisation of and reversals of the various provisions to be detailed in the notes (Anhang): narrative or tabular disclosures, or a mixture of the two.
Two key things to remember:
1) The classic definition of a provision is "a liability of uncertain timing and amount". In fact, provisions are a category of liabilities.
2) It's not so much that "provision" is the correct translation of "Rückstellung", it's actually the case that "Rückstellung" is the correct translation of "provision", which I hope sheds a rather different light on things.
It started out as an Income Statement, and now I'm in an "Anhang" section. Chalk it up to either a learning curve or senility. "-)
Ignore Dietl!? Now I'm really shocked.
Susan: Surely this is a balance sheet item, not an income statement item (unless of course we're talking about additions to provisions or reversals of provisions). Ignore Dietl on anything to do with accounting and finance (actually, one of the lawyers on the City University course I taught last week said to ignore Dietl on anything to do with legal, too, which rather shocked me...).
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Answers
9 mins confidence: peer agreement (net): +3
Rückstellung(en) - provision and/or accrual
provision
Explanation: For ANY German source accounting (HGB or IFRS), provision is the only correct translation. That said, I have at least one client who still insists on using "accruals". It's wrong, but der Kunde ist König.
The only time I could see using accrual would be in some academic writing that needs to be geared toward a US-GAAP audience, and even then, an informed reader would know what a provision is.
Ted Wozniak United States Local time: 17:17 Specializes in field Native speaker of: English PRO pts in category: 556
Grading comment
Thanks, Ted and Robin, for your invaluable help. (I realize now that I got "accruals" also from a TM sent to me by a previous client, so I thought it was probably reliable. Now I know that der Kunde ist König ... but, it's still wrong!)
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