Analysis of the Methodology of Fixed Assets in Accordance with IAS 16 “Fixed Assets” AND P(S)BU 7 “Fixed Assets”: Theory and Practice

  • L. V. Shkulipa National Academy of Statistics, Accounting and Audit
Keywords: fixed assets, asset, depreciation, initial cost, valuation, international standards, national standards

Abstract

The importance of transparent, complete, authentic and timely information comprehensible for all the users of financial reporting has grown in the context of Ukraine’s integration in the international economy. The issue of harmonizing the national accounting system with the international standards is, therefore, on the agenda of the national statistics system. Apart from this, introduction of the international accounting standards in the Ukrainian statistics practice is expected to make Ukraine more attractive for foreign investors and lenders. As theoretical and practical problems related with harmonizing the national accounting standards with international ones are not fully elaborated, the article’s purpose is to analyze the methodology of fixed assets recording by international and national standards, with providing, in table form, comparative characteristics of the underlying sections of International Accounting Standards (IAS) 16 and Rules (Standards) of Accounting (R(S)A) enforced in Ukraine, and to illustrate their practical use. The comparison covers recognition, valuation, recording and reporting of fixed assets, elements of the original cost (estimates at the date of recognition), formation of the original value of fixed assets as a result of various events, revaluation of fixed assets, frequency of revaluation of the liquidation value of fixed assets etc. Practical issues related with fixed assets overvaluation (undervaluation), depreciating, disposal and exchange are highlighted.   

The comparative analysis shows quite significant differences between the two documents in valuation, revaluation, liquidation, disposal of fixed assets. They can be explained by national specifics of record keeping in Ukraine, fully considered in the national standards, and, consequently, by adaptation of accounting in Ukraine to the national economy needs.   

Downloads

Download data is not yet available.

References

1. Polozhennia (standart) bukhhalterskoho obliku 7 “Osnovni zasoby”, zatverdzhene Nakazom Ministerstva finansiv Ukrainy No 92 vid 27.04.2000 r. [Rule (Standard) for Accounting 7 “Fixed Assets”, approved by Cirective of the Ministry of Finance of Ukraine No 92 form 27.04.2000]. Retrieved from http://zakon5.rada.gov.ua/laws/show/z0288-00. [in Ukrainian].
2. Mizhnarodnyi standart bukhhalterskoho obliku 16 “Osnovni zasoby” [International Accounting Standard “Fixed Assets”]. Retrieved from http://zakon5.rada.gov.ua/laws/show/929_014. [in Ukrainian].
3. Voinarenko M. P., Ponomarova N. A., Zamazii O. V. (2010). Mizhnarodni standarty finansovoi zvitnosti ta audytu [International standards of financial reporting and audit]. Kyiv: Center for training materials [in Ukrainian].
4. Azarovska Yu. V. Mizhnarodna praktyka ta vitchyznianyi dosvid obliku neoborotnykh aktyviv [The international practice and the domestic experience in recording of non-current assets]. Retrieved from http://www.mnau.edu.ua/studentresearchjournal/studentresearchjournal021.pdf.
5. Holov S. F., Kostiuchenko V. M. (2000). Bukhhalterskyi oblik za mizhnarodnymy standartamy [The accounting by international standards]. Kyiv: Accounting [in Ukrainian].
6. Popovych V. I. (2012). Oblik osnovnykh zasobiv: porivnialnyi analiz MSBO ta P(s)BO [Recording of fixed assets: a comparative analysis of IAS and R(s)A]. Visnyk Natsionalnoho universytetu “Lvivska politekhnika” – Bulletin of National University “Lvivska Politechnika”, 721, 216–219 [in Ukrainian].
7. Iefremenko O. V. Deiaki pytannia obliku osnovnykh zasobiv [Some issues of fixed asset recording]. Retrieved from http://www.rusnauka.com/16_NPRT _2009/Economics/47688.doc.htm.
8. Osnovni zasoby za MSBO ta P(S)BO: 7 holovnykh vidminnostei [Fixed assets by IAS and R(S)A: seven principal differences]. Vseukrainska profesiina bukhhalterska hazeta “Vse pro bukhhalterskyi oblik” – All-Ukrainian professional accounting newspaper “Everything about accounting”. 16.04.2018. Retrieved from http://vobu.ua/ukr/analytics/consultations/item/osnovni-zasoby-za-msbo-ta-psbo-7-holovnykh-vidminnostei

Abstract views: 582
PDF Downloads: 485
Published
2018-10-17
How to Cite
Shkulipa, L. V. (2018). Analysis of the Methodology of Fixed Assets in Accordance with IAS 16 “Fixed Assets” AND P(S)BU 7 “Fixed Assets”: Theory and Practice. Scientific Bulletin of the National Academy of Statistics, Accounting and Audit, (4), 102-112. https://doi.org/10.31767/nasoa.4.2018.10