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Update for February 2008
Update for April 2005
Update for November 2004
Update for January 2003
Update for July 2002
Update for January 2002
Update for May 2001
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МСФО в кармане.
2007 год – IFRSs in your Pocket in Russian
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In February 2008, Deloitte & Touche CIS (Russia) published МСФО в кармане. 2007 год (PDF 1,427k, 72 pages) – a Russian translation of IFRSs in your Pocket 2007. This pocket guide includes summaries of all IFRSs issued through 30 June 2007. Therefore, the summaries cover IASs through IAS 41 and IFRSs through IFRS 8, as well as Interpretations through IFRIC 12. Please click here for Information about Deloitte Russia. |
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April 2005 Update
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Russia may delay move toward adopting IFRSs
In our November 2004 update, we reported that the Russian Duma (parliament) had given preliminary approval to a bill requiring corporations with more than one subsidiary to publish financial statements that conform to IFRSs starting either in 2004 or 2005. We noted that two additional votes of the Duma were required before the bill would become law. It now appears that the legislation is stalled in the Duma. A news story in Vedomosti (Russia's top business newspaper, a joint venture of the Financial Times and Wall Street Journal) on 2 February 2005 was titled 'IFRS to be Adjourned' and stated that "the effort has come to a standstill". A few weeks later (22 February 2005), an editorial in Vedomosti said that neither the business community nor government is ready for transition to IFRS because "there are no incentives for transparency and there are technical difficulties for implementation that may cause chaos in the reporting rather than increase investment attraction". The editorial also questioned the quality of current IFRS implementation by Russian banks, which have been required to use IFRSs since third quarter 2004.
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November 2004 Update
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Russia moves toward adopting IFRSs
On 29 October 2004, the Duma (parliament) gave preliminary approval to a bill requiring corporations with more than one subsidiary to publish financial statements that conform to International Financial Reporting Standards within six months of the end of their financial year. All companies will still have to report unconsolidated results to Russian standards. Two additional votes of the Duma are required before the bill would become law. The bill as passed calls for companies to report under IFRSs as of 2004. It may be changed to a 2005 effective date before final adoption. Some large Russian companies already report under IFRSs. Others currently use US GAAP. The US GAAP companies will have until 2008 to switch to IFRSs.
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January 2003 Update
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Plan for adopting IFRSs
Russian Vice-Premier and Finance Minister Alexei Kudrin has announced government aproval of a plan to require all listed holding companies in Russia to prepare consolidated financial statements using IFRS starting in 2004. The individual company financial statements of members of the group would continue to be prepared using Russian GAAP. For banks, not only would consolidated statements under IFRS be required starting in 2004, but also individual banks will have to prepare IFRS financial statements in addition to Russian GAAP statements. IFRS reporting would be extended to additional classes of companies in stages through 2007, though not to small companies. At the same time, the Finance Ministry will work to bring Russian GAAP more in line with international accounting standards.
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July 2002 Update
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On 25 July 2002, Russian Prime Minister Mikhail Kasyanov announced that all companies and banks in Russia will be required to prepare their financial statements in accordance with International Accounting Standards starting 1 January 2004. The Prime Minister has ordered the Finance Ministry to develop implementation guidelines for the accounting changes by 1 January 2003.
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January 2002 Update
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The Russian Ministry of Finance sets accounting regulations for non-financial institutions. Entities governed by the Central Bank of the Russian Federation (CBRF) are banks and credit institutions. The CBRF has responsibility for setting their accounting and reporting principles, closely monitor their activity on a regular basis, setting minimum capital requirements and other obligatory prudential ratios, and issuing licenses. The CBRF has declared the following general accounting principles:
- Going concern
- Continuity of accounting principles
- Prudence
- Recognition of income and expenses on a cash basis
- Substance over form
- True and fair view of the financial statements
The main difference between Russian Accounting Standards (RAS) and IAS for banks and credit institutions is that income and expenses are accounted for on a cash basis under RAS. Income is recognised when cash (or other consideration) is received and expenses are recorded at the date the payment is made, with some exceptions. Services paid for are recorded in the income statement on receipt of formal supporting documents confirming that services have been received.The CBRF has announced that it will require the use of IAS for all banks from 2004, however, this proposal has not yet been finalised. In addition, an instruction on calculating and recording provisions against possible losses on loans, securities, other assets and off-balance sheet commitments was made obligatory for all credit institutions operating in the Russian Federation.
As for non-financial companies, following a decision to move to IAS in 1998, the Ministry of Finance of the Russian Federation continues to update and issue new RAS modelled on IAS. However, most RAS (or PBU as they are called in Russian) still differ in many significant respects from IAS. Recently, a new PBU was issued 'Accounting for Loans and Costs of Borrowings' effective 1 January 2002. In addition, revisions have been made to PBU on 'Accounting for Inventory', effective 1 January 2002 and 'Accounting for Property, Plant and Equipment' effective for all financial statements issued in 2001.
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May 2001 Update
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The Russian Federation's move to a market economy has necessitated a change in the standards of accounting for reporting the financial position and results of operations of Russian enterprises.
The Ministry of Finance of the Russian Federation has responsibility for instituting reform to Russian Accounting Standards (RAS) applicable for all organisations, except those that are required to report to the Central Bank of the Russian Federation.
Beginning in 1995, but mostly since 1998, the Ministry of Finance instituted revisions in an effort to account for transactions under more internationally accepted methods. For example, accounting for revenue under the accrual method has been introduced and accruing expenses incurred but not paid is now required in certain situations. Specifically, 14 provisions on accounting (termed PBU) have been issued. These PBUs include:
- Accounting Policy (PBU 1/1998)
- Accounting for Construction Contracts (PBU 2/1998)
- Accounting for Assets and Liabilities Denominated in Foreign Currency (PBU 3/2000)
- Financial Statements (PBU 4/1999)
- Accounting for Inventory (PBU 5/1998)
- Accounting for Property, Plant and Equipment (PBU 6/1997)
- Post-Balance Sheet Events (PBU 7/1998)
- Contingencies (PBU 8/1998)
- Incomes of an Enterprise (PBU 9/1999)
- Expenses of an Enterprise (PBU 10/1999)
- Related Party Disclosures (PBU 11/2000)
- Segment Information (PBU 12/2000)
- Accounting for Government Assistance (PBU 13/2000)
- Accounting for Intangible Assets (PBU 14/2000)
However, even with the issuance of these accounting policies, fundamental differences still remain with internationally accepted methods. While the PBUs may be similar to IAS, important differences still exist. In addition, differences still exist with respect to wholly owned subsidiaries as, under RAS, a subsidiary company does not have to be consolidated.
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