This paper focuses on the traditionally close relationship between financial and tax accounting in Germany by looking first at the historical developments. The so-called authoritativeness principle dates back to the late 19th century. By describing the different facets of the authoritativeness and the reverse author-itativeness principle, the reader will get a good overview of the historical relationship. Furthermore, the role of the highest fiscal court and the influence of some of its decisions is presented in detail. After discussing regulations concerning deferred taxation and methods of calculating those deferred taxes, the paper concludes with an estimation of future development, where it will be shown that the close relationship between commercial and tax accounts is politically stable, but that changes might be ahead with respect to the recent developments in the international accounting harmonisation debate.