New Accounting Standards

In the upcoming several years radical revision of accounting standards valid in the Russian Federation is planned.

On the website of the Ministry of Finance of the Russian Federation there is a program for the elaboration of new accounting standards for 2016-2018. It stipulates both the development of new federal accounting standards and modification of current accounting provisions.

On December 27, 2016 on the website of the Ministry of Finance of the Russian Federation there was information placed on the status of the accounting standards development.

In November 2016 on the website of the Russian Ministry of Finance there were draft amendments of accounting standard 1/2008 Accounting Policy of an Organization published.

The draft stipulated introduction of the following rules:

  • If a business unit having subsidiaries elaborates and approves its own standards binding upon such subsidiaries, a subsidiary chooses accounting methods based on such standards.
  • An organization, which discloses consolidated financial statement drawn up in accordance with International Financial Reporting Standards or financial statement of an organization without a group, is entitled to follow federal accounting standards at developing accounting policy subject to the International Financial Reporting Standards. If application of an accounting method set forth in the federal accounting standard leads to inconsistency of the accounting policy of the organization with the requirements of the International Financial Reporting Standards, the organization is entitled to refrain from using such method.
  • If there are no accounting methods specified in federal accounting standards regarding a certain issue, an organization elaborates an applicable method based on the International Financial Reporting Standards. If there is also no accounting method specified in the International Financial Reporting Standards for such certain issue, an organization elaborates an applicable method based on federal accounting standards for similar and (or) related issues. If there are no federal accounting standards for similar and (or) related issues, an organization elaborates an accounting method independently.
  • If an accounting regulation specifies an opportunity of its voluntary application by organizations prior the maturity date of its mandatory application (early application), an organization applying such regulation early shall disclose such fact in its financial statement.

New standards shall be adopted in 2017: Inventory, Fixed Assets, Documents and Document Flow, Financial Statement and Intangible Assets. Application of standards is scheduled from 2018.

New accounting standard Fixed Assets shall replace accounting standard 6/01.

In respect of property with shelf life above one year, a company shall be entitled to resolve independently whether to recognize it as fixed assets or not. It will allow considering property with the cost above 100 000 rubles as in tax accounting, i.e. eliminating discrepancy.

In respect of other standards, it is too soon to speak about amendments because they have not passed public discussion and examination yet.

Moreover, standards will be adopted, which were previously absent from the accounting law of the Russian Federation, but were part of IFRS.

Igor Chaika

Ex-Managing Director

Audit Practice

Korpus Prava (Russia)

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