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THE RESOLUTION OF THE NATIONAL COMMISSION PERFORMING STATE REGULATION IN THE FIELD OF POWER AND UTILITIES OF UKRAINE

of December 27, 2017 No. 1474

About approval of Rules of the organization and accounting on licensed types of activity subjects of managing in the field of centralized water supply and water disposal

According to Item 3 parts one of article 17 of the Law of Ukraine "About the National commission performing state regulation in the field of power and utilities" the National commission performing state regulation in spheres of power and utilities decide:

1. Approve Rules of the organization and accounting on licensed types of activity by subjects of managing in the field of centralized water supply and water disposal which are applied.

2. This resolution becomes effective from the date of, its publication following behind day in the official printing publication - the Pravitelstvenny Kuryer newspaper.

Chairman of NKREKP
D. Vovk

Approved by the Resolution of the National commission performing state regulation in the field of power and utilities of Ukraine of December 27, 2017 No. 1474

Rules of the organization and accounting on licensed types of activity subjects of managing in the field of centralized water supply and water disposal

1. General provisions

1.1. Action of these rules extends to subjects of natural monopolies which perform (intend to perform) economic activity on centralized water supply and/or water disposal and are licensees of NKREKP (further - licensees).

1.2. These Rules determine the purposes, tasks, the principles, procedures, mechanisms and unified methodical bases of the organization and accounting for licensed types of activity in the field of centralized water supply and water disposal separately from other types of activity of the licensee, including state regulation of which performs NKREKP.

1.3. In these Rules terms are used in the following values:

assets of general purpose - assets which are used more than in one type of economic activity, or assets general production and general economy (administrative, sales, another) appointments;

allocation base - indicator of measurement of certain factor which exerts the greatest impact on amount of the corresponding operating or other expenses (other elements of accounting) and is used for their distribution in case of impossibility of reference of separate expense types (other elements of accounting) directly to certain type of economic activity;

vertically integrated company - the company with two and more types of the productions interconnected among themselves (organizationally, technology and economically) combined by the single purpose of activities;

production product cost (works, services) - the direct expenses of the main operating activiies expressed in cash on production (works, services) and the distributed variables and fixed general production expenses of operating activiies of the company;

expenses of general purpose - the expenses connected with implementation by the licensee more than one type of economic activity and which for the purposes of determination of financial result by types of economic activity are distributed on the basis of the allocation bases established by the licensee or established (approved) authorized body for the purposes of forming rates;

intraeconomic calculations - the calculations arising at vertically integrated company as a result of economic activities between the structural divisions allocated as segments, in case of the interconnected implementation of the licensed and other types of economic activity (including unlicensed types of activity in the field of utilities) for the purpose of disclosure of information on their income, expenses, financial results, assets and liabilities on the principles established by these rules;

the economic segment is an allocated part of activities of the company for production and/or sale of certain types (or groups) products (or goods, works, services) for which there is separate foreign market other than other markets which differs from others: products type (goods, works, services); nature of production process; by income acquisition method (method of sales of products, goods, works, services); the foreign market and buyer category; availability of the specific regulatory circle; risks, characteristic of these activities;

the income from compensation of losses - the income which is recognized compensation amount of the losses of the licensee arising during the corresponding period as difference between the planned and actual expenses of this period;

cost element - set of economically homogeneous expenses;

the involved assets - assets which include non-current and current assets and are used in different types of economic activity of the licensee or related;

external consumers are buyers of centralized water supply and/or water disposal, services in centralized delivery of cold water and/or water disposal (with use of intra house systems) which the licensee implements services in the rates established by NKREKP;

the capital (equity) - excess of book value of assets of the company over its obligations;

compensation of losses of the individual clause - difference between the actual and planned expenses for the corresponding period, determined as the cost of compensation of separate resource: on compensation, tax payment and charges, expenses on acquisition of water at other companies and/or purifications of own sewage with other companies, acquisition of purchased water, the electrical and heat energy, natural gas used for technology and economic needs of the licensee;

cost accounting method on production and calculations of product cost (works, services) - set of methods of the organization of documentation, registration, group and reflection on expense accounts which provide determination of actual cost of products, and necessary information for control of process of forming of product cost;

unreasonably got profit of the licensee which is subject to withdrawal - exceeding of size of the expenses planned in rate(s) on compensation, tax payment and charges, expenses on acquisition of water at other companies and/or purifications of own sewage with other companies, acquisition of services, the electrical, heat energy, natural gas used for technology and economic needs of the licensee over the actual corresponding costs;

accounting on licensed types of activity - process (system) of collection, registration, processing and group of information of the licensee necessary for NKREKP for effective implementation of tasks of state regulation, monitoring and control of activities of subjects of managing in the field of centralized water supply and water disposal;

operating activiies - the main activities of the licensee, and also other types of activity which are not investing or financial activities;

cross subsidizing - movements of the income from implementation of economic activity on centralized water supply and/or water disposal for financial support of other type of economic activity within one subject of managing;

complete product cost (works, services) - the total expenses expressed in cash consisting of cost of sales of products (works, services), the distributed operating expenses of the period (administrative, distribution costs, other operating rooms) and finance costs of the company;

directly involved assets - assets which are used only in one type of economic activity;

the regulatory reporting - the reporting provided by Rules of the organization of the reporting represented by the subjects of managing in the field of heat supply, centralized water supply and water disposal in the National commission performing state regulation in spheres of power and utilities approved by the resolution of NKREKP of May 31, 2017 No. 717;

the working chart of accounts of financial accounting - the systematized list of accounts (including analytical) which provides registration and groups of accounting information on financial and economic activities of the company, determines creation of all system of financial accounting for the purpose of receipt of necessary data for management, monitoring, control and the reporting;

cost of sales of products (works, services) - cost which consists of production product cost (works, services) which was implemented during the accounting period, unallotted fixed general production expenses and above-standard production costs;

the center of responsibility - structural division of the licensee which head within the functional obligations bears responsibility for certain indicators of activities of the licensee (expenses, the income (receipts), profit, investments, etc.). The main centers of responsibility of licensees are the cost center, the center of the income, profit center and the center of investments. The choice by the licensee of method of distribution to the centers of responsibility is determined by organizational or technology specifics of the company.

1.4. Licensees perform accounting for the purpose of forming of information on the income, expenses, assets, the capital and obligations according to the licensed types of activity in the field of centralized water supply and water disposal and other types of activity of the licensee.

1.5. In the field of centralized water supply and water disposal treat the licensed types of activity:

1) centralized water supply (production, transportation and supply of drinking water to consumers);

2) centralized water disposal (branch and/or purification of utility and other sewage).

1.6. Treat other types of activity:

1) the licensed types of activity, except activities in the field of centralized water supply and water disposal;

2) unlicensed types of activity, including:

provision of services on centralized delivery of cold water, water disposal (with use of intra house systems);

other types of activity, including:

water supply in natural state for technical needs of consumers;

repair and servicing of intra house water supply systems and water disposal and installation of sanitary processing equipment;

installation, repair and checking of metering devices of water;

preparation and issue of specifications on joining of consumers to water supply and sewer systems and installation of metering devices of water;

accession to water supply and sewer systems;

production of the design estimates on repair, reconstruction of objects of water supply and sewer systems and connection for legal entities and physical persons;

maintenance, cleaning of water supply, sewer systems, wells of consumers;

carrying out analyses and researches drinking and sewage for legal entities and physical persons;

pumping from cesspools, septic tanks and export of drains on drain stations;

provision of services by motor transport and means of special equipment (vacuum cesspool and flushing machines, welding wheel aggregates, drainage pumps, compressors, tractors, excavators, etc.);

production of fuel briquettes and compost from silt.

For accounting of specifics of managing licensees can disaggregate or expand this list on technology stages, structural units (divisions), categories of consumers and so forth.

1.7. Data of accounting on licensed types of activity are used for the regulatory and control purposes of NKREKP, managerial needs of the licensee when forming rates, investing programs and the reporting represented to NKREKP.

1.8. Accounting tasks on licensed types of activity are:

creation of information base for effective tariff regulation and control, monitoring, investing activities and benchmarking;

ensuring transparency and objectivity of information of licensees by types of economic activity;

prevention of cross subsidizing;

introduction of single techniques of forming by licensees of indicators of the regulatory reporting, ensuring their reliability and comparability.

1.9. Accounting is performed by the licensee separately on each licensed type of activity in the field of centralized water supply and water disposal and on each other type of activity.

1.10. Accounting on licensed types of activity is based on data of accounting and intraeconomic (managerial) accounting and is method of disaggregation of financial information according to the requirements determined by these rules and restrictions of NKREKP regarding the licensed types of activity. Providing separate regulatory requirements is reached by means of intraeconomic (managerial) accounting, that is by application of techniques of calculation, algorithms, calculations and distributions.

1.11. Provisions of these rules do not change and do not cancel financial accounting, and also requirements of the current legislation to forming of financial and tax statements.

1.12. The organization and accounting for licensed types of activity is based on the following principles:

charges and compliance of the income and expenses - the licensee reflects the income and expenses at the time of their origin irrespective of receipt date of money. At the same time for determination of financial result of the accounting period it is necessary to compare the income of the accounting period to expenses which were performed for receipt of this income;

the sequences - the licensee constantly (annually) applies rules of accounting on licensed types of activity, including methodical bases of asset allocation, the capital, obligations, expenses and the income in the procedure established by these rules, except cases when there are essential conditions of modification of techniques that will provide more reliable reflection of information by the licensed types of activity and/or other types of activity, or in case of change of requirements of NKREKP;

cause and effect relationship - the licensee shall directly or by distribution on consecutive and reasonable basis to consider the determined and distributed income, expenses, assets, the capital and obligations of the accounting period on licensed types of activity and/or other types of activity (to products, services), including within structural units (divisions), types of activity;

objectivity - the licensee shall distribute the income, expenses, assets, the capital and obligations of the accounting period between types of economic activity (products, services) is impartial, preventing thereby misstatement of financial result of any kind of economic activity and influence on decision making by users of accounting information;

complete lighting - the licensee shall reflect in accounting and the reporting under licensed types of activity and/or other types of activity all information on the actual and potential effects of the economic activities and events capable to influence the decisions made on its basis;

feasibility - the licensee shall provide rational ratio between costs for receipt of information and economic result from its obtaining;

reliability - the licensee shall guarantee that information on the licensed types of activity and/or other types of activity is exact, reliable, does not contain mistakes which are capable to influence the decisions made on its basis;

usefulness - the licensee shall apply such techniques of accounting on licensed types of activity which allow to obtain information which is this information, exhaustive, useful and available to internal and external users;

transparency - the licensee shall provide identification, accounting, distribution and reference of the income, expenses, assets, the capital and obligations of the licensed types of activity and/or other types of activity so that it was possible is transparent, accurately and unambiguously to display the relevant information in the financial and regulatory reporting;

essence prevalence over form - the licensee reflects transactions in accounting and the reporting according to their economic essence, and not just on the basis of the legal form.

2. The list of actions for providing the organization and accounting for licensed types of activity

2.1. For the purpose of accounting and analytical providing the organization and accounting on licensed types of activity the licensee holds technical, methodical, organizational and information actions.

2.2. Technical supply includes:

the choice of form of accounting of the income, expenses and assets taking into account features of activities and technology of processing of accounting data (program and material security);

use of information technologies of collection, accumulating, processing, storage and information transfer.

2.3. Methodical providing includes:

documentation of economic activities on centralized water supply and drainage system, other types of activity (source and settlement documents, accounting registers, rules and the schedule of document flow);

development and approval of the working chart of accounts of financial accounting of assets, obligations, the capital, the income and expenses (synthetic accounts, sub-accounts and analytical accounts) that allows to perform registration, disaggregation, groups and generalization of accounting information on licensed and other types of activity. The licensee uses sub-accounts, analytical accounts, proceeding from requirements of management, monitoring, extent of disaggregation of data for calculation of product cost (works, services) in licensed types of activity, for control, the analysis and the reporting with preserving account codes of the Chart of accounts of financial accounting, assets, the capital, obligations and economic activities of the companies and organizations approved by the order of the Ministry of Finance of Ukraine of November 30, 1999 No. 291, registered in the Ministry of Justice of Ukraine on December 21, 1999 at No. 892/4185 (further - the Chart of accounts of financial accounting);

procedure (technique) for distribution and accounting of the income, expenses, financial results, obligations, the capital and assets on licensed types of activity separately from other types of activity;

determination of methods of calculation of cost of production of centralized water supply and water disposal, centralized delivery of cold water, water disposal (with use of intra house systems).

2.4. Organizational support includes creation of necessary conditions for the rational organization of accounting on licensed types of activity and creation of the regulatory reporting, in particular:

system development and forms of intraeconomic (managerial) accounting and reporting of economic activities under licensed types of activity, additional system of analytical accounts and registers of analytics;

approval of rules of document flow and technology of processing of accounting and settlement information, determination of the rights of workers to signing of documents on licensed types of activity;

control of observance of requirements for accounting on licensed types of activity, comparability of indicators of forms of the regulatory reporting;

organization of professional development of personnel of the licensee.

2.5. Information support includes:

creation of information model of the licensee and the databases including automated;

timely informing the relevant services and divisions on changes in the legislation on regulation of the corresponding field of activity, rules of accounting on licensed types of activity and so forth.

2.6. In case of development of technical, methodical, organizational and information actions the licensee considers specifics of activities in the field of centralized water supply and water disposal, including availability:

independent realization by the licensee to the final consumer of centralized water supply and water disposal on complete production cycle of production;

realization of centralized water supply and water disposal to other subjects of managing which are licensees in the field of centralized water supply and water disposal;

uses of centralized water supply and water disposal on complete production cycle for provision of services on centralized delivery of cold water, water disposal (with use of intra house systems) and their realization by the licensee as the contractor of these services to independently final consumer of such services;

realization of water in natural state to other subjects of managing and households, physical persons for their technical needs;

the acquired water at other subjects of managing of centralized water supply and/or purification of own sewage with other subjects of managing in the field of centralized water disposal both for realization to external consumers, and for internal economic needs.

3. Rules for apportionment of assets, obligations, the capital, the income and expenses between types of activity

3.1. Assets, obligations, the capital, the income and expenses of the licensee are distributed between types of activity by the general rule on:

such that can be directly (directly) carried to one type of activity (the licensed type of activity in the field of centralized water supply and water disposal, other type of activity);

such that are subject to distribution on consecutive basis with certain (reasonable) allocation base (further - distributed);

unallotted are part of assets, obligations, the capital, the income and expenses which did not enter in directly carried or distributed.

3.2. Have no direct reference (directly) and such assets, obligations, the capital, the income and expenses on which restrictions in the current legislation are established normative or regulatory (including tax) or which are determined by those by the independent solution of the licensee are not subject to distribution on certain (reasonable) bases to licensed types of activity in the field of centralized water supply and water disposal.

In case of lack of legislative restrictions on assets, obligations, the capital, the income and expenses which are unallotted for licensed types of activity in the field of centralized water supply and water disposal the licensee independently makes the decision on their inclusion in structure of other types of activity, except the licensed types of activity in the field of centralized water supply and water disposal and provision of services on centralized delivery of cold water, water disposal (with use of intra house systems).

3.3. Include in structure of assets, obligations, the capital, the income and expenses of each separate type of activity such which are directly connected with one type of activity, and also distributed on certain allocation base.

3.4. Asset allocation between types of activity:

1) directly involved assets of the licensed types of activity in the field of centralized water supply and water disposal is part of assets of the licensee which directly are used by it for implementation of one type of activity in the specified sphere, that is centralized water supply, water disposal;

2) directly involved assets of other types of activity are assets which are directly used by the licensee for implementation of any other type of activity, except the licensed types of activity in the field of centralized water supply and water disposal;

3) allocation base of assets of general purpose is the original cost of directly involved non-current assets on types of activity of the licensee. The asset cost of general purpose distributed on original cost of directly involved non-current assets is not used for expense allocation, connected with such assets;

4) in the field of centralized water supply and water disposal do not join in structure of the involved assets of the licensed types of activity:

non-productive fixed assets (including objects of social infrastructure);

incomplete capital investments;

investment real estate;

the non-current assets withheld for sale and groups of disposal;

financial investments;

biological assets;

delayed tax assets;

receivables by calculations for imputed incomes in the form of dividends;

other involved assets which are directly connected with other types of activity.

3.5. Distribution of obligations between types of activity:

1) obligations which directly concern licensed types of activity in the field of centralized water supply and water disposal, consider those if the income and expenses connected with their origin belong to these types of activity;

2) the obligations which are directly concerning other types of activity of the licensee are considered as those if the income and expenses connected with their origin belong directly to other types of activity of the licensee;

3) the obligations of the licensee concerning several licensed in the field of centralized water supply and water disposal or other types of activity, are subject to distribution on the established reasonable allocation base if debt maintenance expenses are also distributed on the following types of activity, products (works, services). Allocation base of obligations of the licensee are direct expenses on types of activity of the licensee;

4) in structure of obligations of the licensed types of activity in the field of centralized water supply and water disposal are not included:

delayed tax liabilities;

the long-term loans and obligations concerning activities of the company - the licensee in general;

providing future expenses and payments;

target financing which concerns activities of the company licensee in general;

the obligations connected with the irreversible assets withheld for sale and groups of disposal;

other obligations which are directly connected with other types of activity.

3.6. Capital allocation between types of activity:

1) the capital on licensed and other types of activity is determined by subtraction from asset cost of the amount of obligations of the corresponding type of activity (by accounting equations);

2) the licensee has the right to determine equity components by the general rule provided in Item 3.1 of this Chapter.

3.7. Income distribution between types of activity:

1) the income of the corresponding licensed type of activity in the field of centralized water supply and water disposal the income of the licensee which can be directly carried to activities for centralized water supply and/or water disposal are recognized or are determined by distribution on reasonable and consecutive basis;

2) the income of any other type of activity, except the licensed types of activity in the field of centralized water supply and water disposal, the income of the licensee which is directly connected with implementation of other type of activity or determined by distribution on reasonable and consecutive basis is recognized;

3) the income from other operating activiies if their obtaining is connected with licensed types of activity in the field of centralized water supply and water disposal and other types of activity which are subject to distribution between types of activity of the licensee it is pro rata to cost of sales of products (works, services).

Financial and other incomes of the licensee is unallotted, except cases when receipt of such income is directly connected with separate type of activity of the company;

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