1. In case the Federal Accounting Standards provide no guidance, the company develops an accounting method based on the statutory accounting regulations, federal and (or) industry standards. The following hierarchy of documents applies:
- International Financial Reporting Standards,
- provisions of federal and (or) industry accounting standards applicable to similar and (or) related situations,
- accounting recommendations.
2. Companies which prepare and disclose financial statements prepared under IFRS according to the Federal Law “On Consolidated Financial Statements” are allowed to develop their accounting policies based on the Federal Accounting Standards taking into account IFRS requirements. In particular, provisions of the Federal Accounting Standards are waived if they contradict the IFRS.
It is also stipulated that any deviation from the Federal Accounting Standards in favor of the IFRS should be properly described and disclosed.
Applying the amended document: At the moment, it is not yet clear when the amendments take effect. Two options seem to be possible:
- Applying the amendments to the accounting policies starting from the 2017 financial statements,
- Applying the amendments to the accounting policies starting from the 2018 financial statements.
We have requested a clarification from the Ministry of Finance in respect of the start date of the amendments application.
Until the official clarification has been published, we recommend the following:
- Sending relevant inquiries to the Ministry of Finance,
- Examining the accounting policies in the following areas (among others):
- leases (IAS 17),
- hedging financial risks, accounting of financial instruments (IAS 32, IFRS 9),
- testing FA and non-exclusive rights for impairment (IAS 36),
- accounting of unfinished and unregistered research and development and intangible assets (IAS 38),
- investment property (IAS 40),
- agriculture (apart from fixed assets accounting governed by RAS 6/01) (IAS 41),
- earnings per share (IAS 33),
- employee benefits (IAS 19),
- accounting and reporting by retirement benefit plans (IAS 26),
- construction contracts (IAS 11).