Foundation; information on legal supervision

For their protection, foundations that pursue public purposes, with the exception of foundations administered by the state, are subject to the legal supervision of the state (foundation supervision). The foundation authorities are the governments.

As the foundation authority, the governments are responsible for foundations with legal capacity that have their registered office in Bavaria in accordance with their statutes. This does not apply to ecclesiastical foundations and foundations established by law. In the case of municipal foundations that are exclusively administered and represented by the respective municipal bodies, the foundation authority is replaced by the legal supervisory authority of the respective local authority (district office for municipalities belonging to a district, government for municipalities not belonging to a district or the State Ministry of the Interior, for Sport and Integration).

Foundation supervision focuses in particular on compliance with the founder's intentions, the fulfillment of the foundation's purpose and the preservation of the basic assets. This is regularly monitored as part of the audit.

The foundations are obliged to keep proper accounts. Within nine months of the end of the financial year, a statement of accounts and a statement of assets and liabilities (annual financial statement) must be prepared and submitted to the foundation authority together with a report on the fulfillment of the foundation's purpose. The foundation authority audits the annual financial statements (unless the annual financial statements have been audited by the foundation's own government auditing bodies, an auditing association, an auditor or a sworn auditor).

In addition, the foundation authorities should advise, promote and protect the foundations in the fulfillment of their tasks and strengthen the decision-making power and personal responsibility of the foundation bodies.

The advisory and supervisory activities only cover foundation law matters. If further specialist advice is required - for example on tax, inheritance or commercial law issues - please contact the relevant tax office, tax consultant, auditor, lawyer or notary, as appropriate.

Costs are incurred for certain supervisory measures that only apply in exceptional cases, as well as for auditing, depending on the administrative effort involved and the importance of the matter. Otherwise, the activities of the foundation supervisory authority are free of charge for foundations that primarily pursue public purposes.