Two-account model in an Austrian KG: separate the capital contribution, variable account, profit, withdrawals and the limited partner liability amount.
A two-account model can separate the limited partner's fixed contribution from ongoing allocations of profit and loss and from withdrawals. The labels capital account I and capital account II are not uniform statutory account types. The agreement determines which legal consequences attach to each account.
The review must keep four levels apart: the agreed contribution, the liability amount shown in the company register, the allocation of profit and loss and the actual flow of money. A negative variable-account balance therefore does not by itself establish that a payment was impermissible or that creditor-facing liability has changed.
Choose the current trigger. The result identifies the contract and accounting documents that should be read together first.
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Start with the KG agreement, the company register extract and the contribution undertaking. The agreement review article provides a useful document-control comparison.
Match the annual accounts, the allocation resolution and the account entries. The profit allocation article provides a related distribution framework.
Prepare a cash-flow file with payment records, resolutions and account reconciliation. For shareholder loans, compare the documentation of ranking and repayment.
Compare the agreement wording with the partner resolution and the entry. For a disputed vote, the article on abstentions and vote counting offers a related review structure.
Set out contributions, repayments and profit withdrawals chronologically. Section 172 UGB must be applied to the actual account movements, not to an account label alone.
Under a two-account model, a fixed account typically records the agreed contribution while a variable account records ongoing profit and loss allocations, withdrawals and other movements defined by the agreement. In practice these accounts are often called capital account I and capital account II. The agreement may use different labels or add further accounts.
The accounts first provide a presentation and reconciliation method. Whether a balance creates a right to payment, a repayment duty or only an internal calculation follows from the KG agreement, partner resolutions and statutory rules. An accounting plan cannot replace clear clauses on contributions, profit, loss, withdrawals and reversals.
The development of each account over the relevant financial years should be preserved. Each entry should be matched to the annual accounts, the profit-allocation resolution and the payment record. The article on restating the agreement shows why inconsistent historic clauses should be captured before a change.
Section 167 UGB provides a specific rule for calculating profit in an KG. Unless the agreement provides otherwise, general partners first receive an amount of annual profit appropriate to their liability. Section 167 refers to section 121 UGB for the remaining profit and for the loss of a financial year.
Section 121 UGB uses capital shares where all partners have the same level of participation duties. Different levels of participation must be taken into account in allocating profit. The KG agreement should therefore state whether the variable account follows this statutory structure or a separate contractual ratio.
Posting a loss to the variable account is separate from the question of whether money is paid. A loss balance may limit a later distribution without itself being a payment. Conversely, a payment is not a profit distribution merely because it was posted to the variable account.
Section 122 UGB generally gives a partner a claim to payment of the profit share. Payment may be withheld if it would cause manifest harm to the partnership, if the partners resolve otherwise or if the contribution was not made in accordance with the agreement. A partner is otherwise not authorised to make withdrawals without the consent of the other partners.
Section 168 UGB adds rules for limited partners. A limited partner cannot demand payment of profit to the extent the agreed contribution has not been made or the payment would reduce the amount paid in on the contribution. Section 172 UGB connects this with creditor-facing effects where a contribution is repaid or profits are withdrawn while earlier losses have not been offset by later profits.
The agreement should name each payment category: profit advance, resolved distribution, private withdrawal, repayment of a shareholder loan and reversal to a variable account. Recipient, approval, entry and reversal belong in the evidence for each category. A general clause referring only to the account balance leaves these distinctions open.
Under section 164 UGB, limited partners are excluded from managing the business. They generally cannot object to an act of a general partner unless it goes beyond the ordinary operation of the business. The agreement may develop the internal decision structure, but it should keep management, consent and monitoring distinct.
Consent to a withdrawal is separate from ongoing accounting. A limited partner may request information or a resolution without taking over management. Conversely, a positive variable-account balance does not automatically constitute consent to payment. The article on voting proxies and evidence illustrates why a represented vote or consent needs a reliable record.
For extraordinary measures, the agreement, partner resolution and account movements should align. The resolution should state the legal basis, amount, account type, payment date and treatment of a later loss. This keeps the intended character of the payment traceable.
A review needs the current KG agreement and amendments, company register extract, contribution undertakings, annual accounts, partner resolutions, account ledgers and payment records. Loans, security and side agreements should also be captured where they affect the balance or payment basis.
Start with an account chronology. For each financial year mark the opening balance, contribution, profit and loss allocation, withdrawals, distributions, repayments and corrections. Then test whether the entries were permitted by the agreement and whether their labels match the actual legal basis.
If the model is changed, transitional rules are needed for already posted profit and loss shares, open withdrawals and negative balances. A new account label does not resolve an old legal question. For a planned resolution, the majority catalogue is only a comparison because a KG is governed by its own agreement and UGB rules.
The final reconciliation should expressly distinguish internal accounting from external liability. It should show which amounts remain open, which payments were resolved and which documents are missing for the next tax or legal review. Subscribe to BRANDaktuelle legal updates.
No. Capital account I and capital account II are common contractual and accounting labels. The KG agreement must define the legal consequences attached to the accounts.
No. The liability amount is the relevant external liability measure for the limited partner. An internal account can include contributions, profit and loss shares, withdrawals and other movements.
That depends on the agreement, the profit determination, the resolution and the statutory limits. Sections 168 and 172 UGB can restrict payment or withdrawal where the contribution was not made or has been reduced by losses and payment.
It first shows an accounting shortfall after the recorded movements. Whether it creates a repayment, balancing or further contribution duty must be derived from the agreement and the entries.
The KG agreement and amendments, company register extract, contribution undertaking, annual accounts, resolutions, account ledgers, payment records and relevant loan and security documents.
Review and structure GmbH articles with Brandauer Rechtsanwälte in Austria.
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