Adjusted revenue and expenditure and net lending of municipalities and associations of municipalities

Definition: The municipalities (municipalities) have a largely independent status in the Federal Republic of Germany. The Basic Law (Art. 28) guarantees local self-government. Thus, ensuring self-government also includes financial ownership. In general, municipalities are responsible for providing services of general interest to citizens. For example, the municipalities maintain schools, day care centres and institutions for the elderly. In addition, many social services are provided by the municipalities. These tasks are financed by the revenue of the municipalities. If these revenues are insufficient, the deficit is compensated by borrowing. The comparison of adjusted revenue and expenditure, i.e. excluding special financing operations such as debt borrowing and amortisation, reveals a possible imbalance between the two items. On the revenue side, special financing operations include borrowing on the credit market, taking-up of internal loans, withdrawal from reserves and the liquidation of surpluses from previous years. On the expenditure side, this includes the repayment of debts, repayment of internal loans, the addition of reserves and the settlement of deficits from previous years. An important indicator for the presentation of the financial situation of the municipalities is the net lending balance of the general budgets. It indicates the difference between total revenue and expenditure less specific financing operations. If the revenue is larger than expenditure, there is a surplus and, conversely, a financing deficit. Note: Further information on the municipal finance reports can be found on the website of the Ministry of the Interior and Municipalities of North Rhine-Westphalia. Data source: IT.NRW, 2000-2014: Results of annual accounts statistics, 2015: Results of quarterly cash statistics