Current issues of using discounted value in financial statements

2021 ◽  
Vol 20 (9) ◽  
pp. 1703-1730
Author(s):  
Ol'ga V. EFIMOVA ◽  
Ol'ga V. ROZHNOVA
Keyword(s):  
Analytic Function ◽  
Conceptual Framework ◽  
Financial Reporting ◽  
Financial Statements ◽  
Consolidated Financial Statements ◽  
Public Companies ◽  
Russian Scientific ◽  
Scope Of Application ◽  
Reporting Data ◽  
Comprehensive Study

Subject. We address the determination and use of discounted value in the preparation of financial statements under IFRS and problems associated with this estimate, including in circumstances of pandemics. Objectives. We focus on a comprehensive study of the purpose, reasons, methods of calculating and applying the discounted value in the process of preparing the financial statements, and consider factors that affect the estimate and its changes, as well as its impact on the indicators of financial statements. Methods. The study employs methods of logical, statistical, comparative, and linguistic analysis. We also review foreign and Russian scientific and practical literature, the rules contained in the Conceptual Framework for Financial Reporting, consolidated financial statements of Russian public companies for 2019 and 2020. Results. We unveil problems associated with the use of discounted value and the area of its influence, make proposals to improve its measurement and disclosure in the preparation of financial statements. The scope of application of the results obtained includes: building up regular reporting by economic entities, primarily in terms of determining the discounted value, including in the direction of coordinating financial and non-financial reporting information and improving the reliability of disclosures and their analytic function. Conclusions. To improve the reliability of financial statements, it is crucial to expand disclosures about approaches and assumptions used in measuring the discounted value and coordinate information about the elements of discounted value with non-financial reporting data.

Megascreens USA Inc.—A Foreign Operations Case

2007 ◽  
Vol 22 (4) ◽  
pp. 579-590 ◽  
Author(s):  
Charles A. Carslaw ◽  
S. E. C. Purvis
Keyword(s):  
Financial Reporting ◽  
Foreign Currency ◽  
Financial Statements ◽  
The United States ◽  
Cash Flows ◽  
Consolidated Financial Statements ◽  
Comprehensive Overview ◽  
Financial Reporting Standards ◽  
Foreign Operations ◽  
Statement Of Cash Flows

This relatively short case gives students a comprehensive overview of the steps required to prepare consolidated financial statements under U.S. GAAP when a subsidiary prepares its accounts under a foreign GAAP—in this case, International Financial Reporting Standards (IFRS). While the case is closely based on an actual Australasian company seeking listing in the United States, the product and the exact financial details are disguised. Specifically, the case exposes students to the following: accounting for foreign currency transactions; adjustments to convert foreign GAAP to U.S. GAAP (accounting for license fees); translation of financial statements; change of functional currency; remeasurement of financial statements; and foreign consolidation and statement of cash flows with foreign operations. The case has been field-tested in an advanced accounting course and is also suitable for use in international accounting courses. Both undergraduate and graduate students have profited from the case.

scholarly journals Relevance of financial reporting quality - Theory and practice in Vietnamese enterprises

2017 ◽  
Vol 1 (Q2) ◽  
pp. 119-128
Author(s):  
Thuan Quoc Pham
Keyword(s):  
Conceptual Framework ◽  
Financial Reporting ◽  
Accounting Standards ◽  
Reporting Quality ◽  
Professional Associations ◽  
Financial Statements ◽  
Theory And Practice ◽  
Financial Information ◽  
Financial Reporting Quality

Financial reporting quality is one the most interesting topics which draw a great deal of attention to researchers and scientists in the field of accounting (Céline Michailesco, 2010). In the review of research on financial information from 1980 to 2016, Pham (2016) found that characteristics of useful financial information are relatively diverse with as many as 15 attributes being identified. In addition, he also found that all research in any period has employed the characteristics published by professional associations such as American Institute of Accountants, Financial Accounting Standards Board (FASB) and the International Accounting Standards Board (IASB as theoretical basis. Research on the quality of financial information is diverse yet have many things in common, above all is the Relevance characteristic which considered to be the basic qualitative component of the quality of financial information in financial statements. Conceptual Framework officially issued by FASB & IASB in 2010 (FASB & IASB 2010) has further confirmed Relevance is the basic quality component of financial information. Compared with previous announcements, there has been a considerable change in the criteria and attributes used to evaluate the appropriateness of Relevance characteristic of financial information in financial statements. This study aims at confirming the importance of the Relevance component in evaluating the quality of financial information, clarifyingg the characteristics of Relevance measurement before and after Conceptual Framework 2010 and constructing relevant scales as well as measuring the qualitative characteristic of Relevance among enterprises in Vietnam.

scholarly journals The influence of culture on disclosures in financial statements prepared under International Financial Reporting Standards

2019 ◽  
Vol 2019 (101 (157)) ◽  
pp. 111-132 ◽  
Author(s):  
Jerzy Gierusz ◽  
Katarzyna Koleśnik
Keyword(s):  
Financial Reporting ◽  
Comparative Studies ◽  
Financial Statements ◽  
Arab Countries ◽  
International Financial Reporting Standards ◽  
Reporting Standards ◽  
Consolidated Financial Statements ◽  
Financial Reporting Standards ◽  
Financial Disclosures ◽  
The Impact

The primary objective of this article is to investigate the impact of culture (as measured by Hofstede) on disclosures in financial statements prepared under International Financial Reporting Standards (IFRS) by firms from different countries. The sample comprises 2011−2013 consolidated financial statements of stock companies (excluding banks, insurance, and other financial institutions) from four countries repre- senting different cultural areas: the United Kingdom (Anglo), Germany (Germanic), Poland (Central Eastern Europe; CEE) and Kuwait (Arab). The research material came from 312 annual consolidated financial statements from 104 companies. The results reveal that cultural values have a significant impact on financial disclosures even after the use of IFRS. The paper is one of the few comparative studies attempting to assess the effects of culture on financial disclosures in Western Europe countries, CEE countries and Arab countries. Most of the international comparative studies in this research area have neglected CEE and Arab countries.

Developing a Government Reporting Taxonomy

2016 ◽  
Vol 30 (2) ◽  
pp. 49-81 ◽  
Author(s):  
Neal M. Snow ◽  
Jacqueline L. Reck
Keyword(s):  
Financial Reporting ◽  
Municipal Government ◽  
Financial Statements ◽  
Bond Market ◽  
Empirical Approach ◽  
Municipal Bond ◽  
Data Accessibility ◽  
Public Companies ◽  
Private Investors ◽  
Over Time

ABSTRACT The municipal bond market is a $3.7 trillion market with approximately 75 percent of the market held by private investors (SEC 2012). Municipal bondholders and potential buyers do not have the same level of information as those investors choosing to invest in public companies. This inequity is, in part, the result of poor data accessibility. Frequently the data provided are in a format that does not allow easy comparison across governments or over time. To increase comparability and consistency in government reporting we build a government financial reporting taxonomy using the empirical approach. The completed taxonomy has 194 terms that cover financial statements filed by municipalities. Expert analysts and preparers in government reporting reviewed the completed taxonomy. This study has implications for the municipal reporting market and those entities that regulate them by providing a validated municipal government financial reporting taxonomy.

Примена опрезности у финансијском извештавању – навика или потреба? // Application of prudence in financial reporting – a habit or necessity?

2018 ◽  
Vol 13 (22) ◽  
pp. 63
Author(s):  
Ката Шкарић Јовановић
Keyword(s):  
Conceptual Framework ◽  
Financial Reporting ◽  
Empirical Studies ◽  
Financial Statements ◽  
Radical Change ◽  
Fair Value ◽  
Time Asymmetry ◽  
Historical Cost ◽  
Primary Users ◽  
Gains And Losses

Резиме: Финансијско извештавање већ више векова с правом се означава као конзервативно. Начело опрезности чија премена генерише конзервативизам, а које се одликује временском асиметријом у признавању губитака и добитака, не само да је једно од најстаријих, већ и једно од најутицајнијих правила у финансијском извештавању. Означавање инвеститора, поверилаца и осталих зајмодаваца као примарних корисника финансијских извештаја довело је до тога да се у Концептуалном оквиру финансијског извешавања неутралној презентацији финансијских извештаја даје апсолутни примат у односу на опрезност, која је означена као непожељна. Бројна емпиријска истраживања, у великој мери изазвана и оваквом радикалном променом, показала су да су користи од примене конзервативизма у финансијском извештању и у данашњим околностима такве да се увелико надилазе његове слабости. С дуге стране, неутралност се може постићи у презентацији појединих позиција финансијских извшетаја али не при постојећим околностима и финансијских извештаја у целини. Заменом опрезности са неутралношћу нарушена је конзистентност која је нужна између Концептуалног оквира за финансијско извештавање и МРС/МСФИ. У многим од МРС/МСФИ садржани су захтеви за признавање и вредновање који су засновани на опрезности. Испуњавање ових захтева неминовно води конзервативизму у презентацији финансијских извештаја. Како су МРС/МСФИ изграђени на мешовитој основи коју чине: концепт историјског трошка, с којим је чврсто повезана опрезност, и концепт фер вредности, за који се везује неутралност. Стога се сасвим основано у презентацији финансијских извештаја могу очекивати и неутрално и конзервативно презентиране информације. Враћањем опрезности у Концептуални оквир финансијског извештавања осим што би била отклоњена неконзистност која постоји између њега као основе на којој се ревидирају постојећи и доносе нови стандарди, био би потврђен допринос конзервативизма заштити интереса поверилаца и инвеститора.Summary: For many centuries financial reporting has been rightfully labeled as conservative. The principle of prudence whose application generates conservatism, which is characterized by time asymmetry in the recognition of gains and losses, is not only one of the oldest but also one of the most influential rules in financial reporting. Determining the investors, creditors and other lenders as primary users of financial statements has led to the fact that in the Conceptual Framework for Financial Reporting the neutral presentation of financial statements has the absolute precedence over prudence, which is marked as undesirable. Numerous empirical studies largely caused by such a radical change have shown that the benefits of application of conservatism in financial reporting and in the present circumstances are such that they greatly surpass its weaknesses. On the other hand, neutrality can be achieved in the presentation of certain positions in financial statements but not under the existing circumstances and financial statements in general. Substituting prudence with neutrality violates consistency, which is necessary between the Conceptual Framework for Financial Reporting and IAS/IFRS. Many of IAS/IFRS contain requests for recognition and validation that are based on the prudence. Meeting these requests will inevitably lead to conservatism in the presentation of financial statements. Since IAS/IFRS are built on a mixed basis consisting of the historical cost concept, which is tightly linked with prudence, and fair value concept, which is linked with neutrality, then it is quite reasonable to expect both neutrally and conservatively presented information in the presentation of financial statements. By restoring prudence in the Conceptual Framework for Financial Reporting, besides eliminating inconsistence that exists between it as a basis for revising existing and adopting new standards, contribution of conservatism to protecting the interests of creditors and investors would be confirmed.

Actual Problems of Recording in Accounting and Financial Reporting of Insurance Companies of the Amounts of Refunds of Insurance Premiums

Auditor ◽  
2016 ◽  
Vol 2 (7) ◽  
pp. 31-36
Author(s):  
Пальгуева ◽  
T. Palgueva
Keyword(s):  
Financial Reporting ◽  
Financial Statements ◽  
Insurance Companies ◽  
Data Manipulation ◽  
Insurance Premiums ◽  
Reporting Data

The paper deals with the recording in the accounting and fi nancial reporting of insurance companies of amount of the refund of premiums in the context of ongoing changes in the Russian legislation. Th e author’s approach to the order of their recording in the financial statements in order to improve its quality and prevent potential reporting data manipulation is off ered.

scholarly journals TAX RISKS IN THE OIL AND GAS SECTOR OF THE RUSSIAN ECONOMY 

2019 ◽  
Author(s):  
А.Х. Цакаев ◽  
А.Р. Батукаева
Keyword(s):  
Financial Reporting ◽  
Oil And Gas ◽  
Financial Statements ◽  
International Financial Reporting Standards ◽  
Reporting Standards ◽  
Consolidated Financial Statements ◽  
Financial Reporting Standards ◽  
Russian Economy ◽  
Oil And Gas Companies ◽  
Oil And Gas Sector

Представлены результаты оценки налогового риска ПАО НК Роснефть , ПАО Газпром и ПАО ЛУКОЙЛ согласно общедоступным критериям самостоятельной оценки рисков для налогоплательщиков Концепции планирования выездных налоговых проверок, исходя из данных консолидированной финансовой отчетности, подготовленной в соответствии с международными стандартами финансовой отчетности, позволившие сделать вывод о предложении по преобразованию данной Концепции под международные стандарты финансовой отчетности. Сформулированы предложения по обеспечению снижения уровня налоговых рисков в деятельности российских нефтегазовых компаний Results of assessment of tax risk of PJSC Rosneft, PJSC Gazprom and PJSC Lukoil according to public criteria of independent risk assessment for taxpayers of the Concept of planning of exit tax audits, proceeding from data of the consolidated financial statements prepared according to International Financial Reporting Standards, allowed to draw a conclusion on the offer on transformation of this Concept under International Financial Reporting Standards are presented. Offers on ensuring decrease in level of tax risks in activity of the Russian oil and gas companies are formulated.

scholarly journals Ontwikkelingen in het conceptual framework

2013 ◽  
Vol 87 (9) ◽  
pp. 355-364
Author(s):  
Dick Van Offeren ◽  
Joop Witjes ◽  
Tim Verdoes
Keyword(s):  
Conceptual Framework ◽  
Financial Reporting ◽  
Accounting Standards ◽  
Financial Statements ◽  
Financial Accounting ◽  
International Accounting ◽  
International Accounting Standards ◽  
Financial Accounting Standards Board ◽  
Reporting Framework ◽  
International Accounting Standards Board

De International Accounting Standards Board (IASB) heeft recent het conceptual framework-project als kernproject aangemerkt. Het oorspronkelijke Framework for the preparation and presentation of financial statements (framework 1989) was aan een fundamentele herziening toe. Samen met de Financial Accounting Standards Board (FASB) heeft de IASB de eerste fase van het Conceptual framework for financial reporting (framework 2010) voltooid. In deze eerste fase worden twee onderwerpen besproken. Dit zijn het doel van financiële verslaggeving en de kwalitatieve kenmerken van financiële verslaggeving. Wij bespreken deze twee onderwerpen en gaan in op de verschillen tussen het framework 2010 en het framework 1989. Wij benadrukken het verschil in toepassingsgebied van de twee frameworks. Het framework 2010 is gericht op het ruimere begrip financial reporting, financiële verslaggeving en het framework 1989 was beperkt tot financial statements, jaarrekeningen.

scholarly journals The Framework for Audits of the Financial Statements of the Group of Enterprises by ISA 600 Requirements

2019 ◽  
pp. 54-66
Author(s):  
V. P. PANTELEIEV
Keyword(s):  
Financial Reporting ◽  
Financial Statements ◽  
Regulatory Framework ◽  
Financial Information ◽  
Consolidated Financial Statements ◽  
Consolidation Process ◽  
Quality Audit ◽  
Professional Activities ◽  
Audit Strategy ◽  
Audit Standards

Compliance with relevant regulations is the basis of the professional activities of auditors. Users of financial statements require the auditor to conduct quality audit. The auditor’s opinion on the reliability of the financial statements of the group is based on the application of appropriate audit approaches, based both on audit practice and audit standards, and insist on compliance with recognized audit requirements. The aim of the article is to highlight the content of the main rules for an independent auditor to audit the financial statements of a group using the requirements of the modern regulatory framework, in particular International Standard of Auditing (ISA) 600. The essence of the main rules of an independent auditor conducting an audit of a group’s financial statements using the requirements of the modern regulatory framework, in particular ISA 600, is disclosed. The need for regulation of an audit of a group’s consolidated financial statements is formulated, the content and important provisions of the requirements of a professional standard ISA 600 “Special Considerations – Audits of group financial statements (including the work of component auditors)”. Interpretation of the requirements of ISA 600 for acceptance and continuation of the assignment, the role of the auditor’s assessment of distortions during the audit, audit activities to prevent, detect and combat fraud in the group, the obligation to use the component of the level of distortion by the auditor is given. The author’s vision of the special provisions of the audits of the financial statements of the group is indicated, the sequence of advancing audit procedures in the implementation of the special provisions of the audits, including the work of the component auditors, and the directions for further research are shown.  Conclusions. The responsibility of the auditor and the component auditor is envisaged, and atypical relevant measures are required in response to challenges; the auditor deals with complex structures, the information of the component auditors must be taken into account. ISA 600 is connected with other audit standards, it regulates a number of requirements with the aim of conducting a quality audit of the group financial statements: from the responsibility of the auditor, accepting and continuing the assignment, developing a general audit strategy and plan, understanding of the component auditor, communicating information to the group’s management personnel and those who endowed with high authority at the group level, etc. documentation. The peremptory question of ISA 600 is determining whether he should act as an auditor of the group financial statements, that is, reasonably refuse or accept the assignment; and if accepted and continued, the task if he acts as an auditor of the group financial statements: communication of clear information to the component auditors on the volume and time of their work with financial information relating to the components and the actual results obtained by them; obtaining sufficient audit evidence in sufficient amounts on the financial information of the components and the consolidation process to express an opinion that the group’s financial statements have been prepared in all material respects in accordance with the applicable financial reporting framework.

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