Статистика України (Jun 2015)
Requirements of the International Financial Reporting Standards: Signs of Compliance
Abstract
The unresolved issues of practical implementation of International Financial Reporting Standards (IFRS) in Ukraine are analyzed.Indirect signs of the Ukrainian reporting compliance with IFRS 1 “First-time Adoption of IFRS” are outlined: the increase of fixed assets value (fact of revaluation is analyzed); presence of articles on additional capital (which need not be present, because, when transformed, they are offset to retained earnings); presence of articles on deferred taxes; calculation of the reserve for doubtful debts and the reserve for employees’ vacations. The compliance analysis covering the reporting of 30 Ukrainian companies by subgroup shows that most of them, in obligatory introduction of IFRS, have preferred the reporting format that complies with the international one but doesn’t show the actual reporting figures.The reporting, if made in this way, will fail to attract investors or diminish the IFRS significance for Ukraine and the image of Ukraine. It is proved that implementation of IFRS by all the Ukrainian companies has been premature, being beneficial for only those listed at the stock-exchange or planning to attract foreign loans, with others approaching this issue but formally. The following measures are recommended to improve the effectiveness of regulatory and institutional framework for corporate reporting at national level: to establish independent bodies for audit or accounting supervision, responsible for training, certification, education, up-grading of professional skills, quality control and disciplinary penalties for auditors and audit firms; to introduce mechanisms for regular and effective information sharing with international bodies developing standards and other international bodies in the accounting and reporting field; to expand the role of the stock-exchanges that have become promoters of relevant guidelines for management of the companies listed at them; to enhance coordination of all institutions involved in preparation of corporate reporting; to ensure coordination of the key institutions involved in education and training of professional accountants, such as the Ministry of Education and professional organizations of accountants, for harmonization of curricula with the latest national and international standards
