University Report: Germany Bankruptcy - Budget Analysis and Evaluation

This report provides a financial evaluation of Germany's bankruptcy, focusing on the government budget and potential business failures. It analyzes revenue trends, including sources like taxes and transfers, and assesses the challenges faced by the government due to internal and external factors. The report examines the goals and priorities of the local government in providing goods and services, along with the challenges encountered. It explores budget stabilization measures, such as special funds, and analyzes financial policies related to alternative taxes, including the introduction of a Tax Application Note for financing projects. The analysis considers the impact of an aging population and funding issues on public expenditure, offering insights into the complexities of Germany's local government finances and proposing recommendations for fiscal stability. The report utilizes various sources to support its claims and recommendations.

Running head: GERMANY BANKRUPTCY
Germany’s Bankruptcy
Name of the Student:
Name of the University:
Author’s Note:

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Executive Summary
The aim for the project is to determine the financial evaluation of the Germany Country and the
business failures the organizations may face at the time of their operations. The trends in the
sources for the revenue generation and the balances arrived that is the funds, surpluses and
deficits arriving where determined. The challenges faced by the organization due to internal and
external factors for the revenue sources is determined in the project.

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Table of Contents
Introduction......................................................................................................................................3
Discussion........................................................................................................................................3
Revenue Trend Analysis..............................................................................................................3
Internal and External Opportunities and the Challenges for the Revenue sources......................5
Goals and Priorities of the Local Government Goods and Services...........................................5
Internal and External Issue Faced for Providing Goods and Services.........................................5
Budget Stabilization Measures....................................................................................................6
Analysis of the financial policy towards Alternative Taxes........................................................6
Conclusion.......................................................................................................................................6
Reference.........................................................................................................................................7

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Introduction
The financial evaluation for the Germany Government Budget and the evaluation of the
same were done to identify the trend and the factors, which are influencing the workings of the
same. The internal and external factors identified plays an important role in determining the
revenue sources for the Germany Government. The Public expenditures along with the
challenges faced by the government in managing the same are discussed. The budget
stabilization measures and steps towards alternative taxation forms an important role in the
organization (Grossi, Reichard, & Ruggiero, 2016).
Discussion
Revenue Trend Analysis
The trend analysis for revenue was done on the local municipalities where the analysis
for the revenue and the relevant analysis was done on that basis. There are a lot of ways through
which the government helps the local operating bodies they are helped by the debt financing via
the central government (Asatryan, Feld & Geys, 2015). The only sources for the local
government revenue is the taxes collected through the people living and local taxes like
municipal taxes is the main source for the creation of revenue for the local government bodies.
After the careful analysis of the trend in the revenue it is crucial to not that on an average the
revenue has shown about 9% of the total growth and the same was seen where the expenditure
for the local government was saw a rapid increase (Rhee, Done & Anderson, 2015). It is crucial
to note that the debt financing costs for the local governments has reduced significantly after the
debt restructuring and several initiatives by the central government.

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Revenue Expenditure in the Local Government Budgets
Trend Analysis
Particulars % Change
Revenue 9.62%
Sales 4.88%
Taxes 9.71%
Transfers from Government 14.29%
Expenditure 7.58%
Intermediate consumption 3.81%
Personel expenditure 6.87%
Interest -13.49%
Subsidies 4.44%
Social Benefits 15.01%
Transfers to Government 9.44%
Gross Capital Formation 5.58%
Budget Balance 1952.17%
-15.00%
-10.00%
-5.00%
0.00%
5.00%
10.00%
15.00%
20.00%
Revenue Expenditure in the Local
Government Budgets Trend Analysis

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Internal and External Opportunities and the Challenges for the Revenue sources
The internal problems faced by the Local Government bodies for the creation of the
revenue sources is the lack of revenue generation and collection of taxes. The opportunities that
are still there is increasing the tax base for the local people so that there are adequate amount of
revenue in the form of tax collection. The local government on the same steps could follow
several legal steps like minimum tax rate in order to ensure tax participation and increase the tax
base.
Goals and Priorities of the Local Government Goods and Services
The local government of the Germany has increased the provision for the expenditure and
the same are expected to increase by around 5% whereas the expenditure done in the public
expenditure for the year 2015 and 2016 showed a growth of around 4.5% on an average. The
common and the important revenue expenditure done by the government are in the fields of
military expansion and advanced weapons and technologies for research and development and
rapid expansions. Investing in the betterment of the infrastructure is also an important source of
expenditure for the government.
Internal and External Issue Faced for Providing Goods and Services
The local government bodies faces issues with the provision of the goods and services.
There are several challenges faced by the home country is the ageing population and the funding
challenges and issues faced by the state government in the field of inadequate funding and
financing sources for public expenditure. The changing preference and needs of the community
changes from time to time so one important factor is to incorporate these factors while assessing
the budgetary process (Brusca & Montesinos, 2016).

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Budget Stabilization Measures
The local government should have several steps in order to overcome the volatility
observed in the revenue sources of the government. The budget stabilization measures such as
creation of special funds and creating some amount in provisions could help tackle them
overcome the problem of the volatility (Breeman, Scholten & Timmermans, 2015).
Analysis of the financial policy towards Alternative Taxes
The financial policy should be setup in such a way that would help the local government
in creation of more revenue and increasing the tax base. The financial policy should be evaluated
on the base that the tax rate should be uniform and the same should not be burdensome for the
local community. The introduction of Tax Application note is an additional recommendation for
the stabilization of the budget of the local government. The tax application note is a type of
short-term security type bond, which the government can use for financing the ongoing projects
in the country (Goddard & Issa Mzenzi, 2015).
Conclusion
The Financial analysis for the local Germany government was done for determining alternative
ways of determining the policy trends towards the same were identified and discussed in the
report. There were certain factors and components determined, which affects and influence the
tax base and revenue for the country in the form of taxes. The budget stabilization process and
the alternative way for determining the same in the financial policy were the key factors assessed
in the report.

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Reference
Asatryan, Z., Feld, L. P., & Geys, B. (2015). Partial fiscal decentralization and sub-national
government fiscal discipline: empirical evidence from OECD countries. Public Choice,
163(3-4), 307-320.
Breeman, G., Scholten, P., & Timmermans, A. (2015). Analysing local policy agendas: how
Dutch municipal executive coalitions allocate attention. Local Government Studies,
41(1), 20-43.
Brusca, I., & Montesinos, V. (2016). Implementing performance reporting in local government:
A cross-countries comparison. Public Performance & Management Review, 39(3), 506-
534.
Goddard, A., & Issa Mzenzi, S. (2015). Accounting practices in tanzanian local government
authorities: towards a grounded theory of manipulating legitimacy. In The Public Sector
Accounting, Accountability and Auditing in Emerging Economies (pp. 109-142). Emerald
Group Publishing Limited.
Grossi, G., Reichard, C., & Ruggiero, P. (2016). Appropriateness and use of performance
information in the budgeting process: Some experiences from German and Italian
municipalities. Public Performance & Management Review, 39(3), 581-606.
Rhee, J. C., Done, N., & Anderson, G. F. (2015). Considering long-term care insurance for
middle-income countries: comparing South Korea with Japan and Germany. Health
Policy, 119(10), 1319-1329.

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