New law promotes adoption of IFRS in Russia
23 Aug 2010
The State Duma of the Russian Federation has passed a Law On Consolidated Financial Statements which had remained untouched since almost the end of 2004. On 17 December 2004 the State Duma actually approved the law in the second reading but no attempts to hold the third and final reading of the law were made. The final reading of the draft law finally took place on 7 July 2010, and Russia's President Dmitry Medvedev recently signed it into law.
The law applies to banks, insurance companies, and all companies that have securities accepted to trades at domestic exchanges. It requires these entities to produce, submit to regulators and publish financial statements in accordance with the International Financial Reporting Standards (IFRS). The Law states that IFRS statements are to be produced in addition to statements under the Russian Accounting Standards (RAS) and not in their stead.
Requirements formulated in the new Law will come into effect following a formal recognition from the Government and Central bank. The Law does not present a mechanism or a timeline for such recognition, but it is expected to take place some time between 2012 and 2015.
More information about the financial reporting framework in Russia is available on our IAS Plus country page for Russia.
