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Ministry of Justice of Ukraine

November 17, 2003

No. 1054/8375

ORDER OF THE MINISTRY OF FINANCE OF UKRAINE

of November 7, 2003 No. 617

About approval of the National provision (standard) of financial accounting 27 "The non-current assets withheld for sale and discontinued operation"

(as amended on 30-09-2024)

According to article 6 of the Law of Ukraine "About financial accounting and the financial reporting in Ukraine" PRIKAZYVAYU:

1. Approve the National provision (standard) of financial accounting 27 "The non-current assets withheld for sale and discontinued operation" (further - the National provision (standard) 27) approved by Methodological council on financial accounting of the Ministry of Finance of Ukraine which is applied.

2. To department of financial statistics and analysis, methodology of financial accounting and control (Chugunov I. Ya.) provide provision of this order on state registration in the Ministry of Justice of Ukraine.

3. To impose control of execution of this order on the First Deputy Minister of Finance of Ukraine Yaroshenko F. O.

 

First vice-Prime Minister of Ukraine, Minister of Finance of Ukraine

N. Ya. Azarov

Approved by the Order of the Ministry of Finance of Ukraine of November 7, 2003 No. 617

National provision (standard) of financial accounting 27 "The non-current assets withheld for sale and discontinued operation"

I. General provisions

1. This National provision (standard) determines the methodological principles of forming in financial accounting of information on the non-current assets withheld for sale and group of assets which is necessary to disposal as a result of sale transaction, and also discontinued operation and disclosure of such information in the financial reporting.

2. Regulations of this National provision (standard) are applied by the companies, the organizations, other legal entities (further - the companies) irrespective of patterns of ownership (except budgetary institutions and the companies which according to the legislation constitute the financial reporting under International Financial Reporting Standards).

3. Regulations of this National provision (standard) do not extend to assessment of such assets withheld for sale including the non-current assets included in structure of group of disposal:

3.1. Delayed tax assets.

3.2. Assets which are connected with payments to workers upon termination of their labor activity.

3.3. Non-current financial assets which are estimated at fair value.

3.4. Non-current biological assets which are estimated at fair value, reduced by the expected costs to sell.

3.5. The investment real estate which is estimated at fair value.

4. The terms used in national provisions (standards) of financial accounting matter, provided in this Item.

The cost of use is current value of future cash flows which, as expected, will result from use of asset and its disposal at the end of the term of its useful use (operation).

The expenses connected with distribution of non-current assets - the additional expenses arising in connection with asset allocation between owners, except for financial expenses and tax expenses on profit.

Costs to sell of non-current assets (group of disposal) - the additional expenses arising in connection with disposal of non-current asset (or groups of disposal), except for finance costs and tax expenses on profit.

Group of disposal set of assets which are planned to sale or alienation in a different way by one transaction and obligations which are directly connected with such assets which will be transferred (are extinguished) as a result of such transaction.

The component of the company unit (group of units) generating money both can be separated is operational and provides activities for production and/or sale of products (works, services).

The non-current assets withheld for distribution - the non-current assets which are subject to distribution between owners.

The stopped activities are liquidated or recognized as the component of the company withheld for sale which is:

the separated direction or segment of activities of the company;

part of the unified coordinated plan of refusal of the separate direction or segment of activities of the company;

affiliated enterprise which was acquired only for the purpose of its resale.

II. Recognition and assessment of the non-current assets and group of disposal withheld for sale

1. The non-current asset and group of disposal are recognized withheld for sale if:

economic benefits are expected to be received from their sale, but not from their proper use;

they are ready to sale in their present condition;

their sale, as expected, will be complete for year from the date of recognition their such which contain for sale;

conditions of their sale answer usual conditions of sale for similar assets;

implementation of their sale has high probability, in particular if the management of the company prepares the corresponding plan or the firm contract on sale is signed, their active offer in the market at the price which answers fair value is performed.

The period of completion of sale can be extended for term more than one year if it is caused by circumstances which are out of control of the company continuing to implement the sales plan.

The company which shall implement the sales plan connected with loss of control over affiliated enterprise recognizes all assets of this affiliated enterprise as withheld for sale if the conditions given in this Item are carried out without whether the company will keep uncontrollable share in the former affiliated enterprise after sale.

If the company transfers non-current asset or group of disposal of the non-current assets withheld for sale to the non-current assets withheld for distribution between owners, or on the contrary such change is considered continuation of the initial plan of disposal.

Requirements of this National provision (standard) are applied to non-current assets which keep for distribution between owners.

2. Non-current assets, group of disposal which alienation is planned in a different way than sale for date of balance, are not recognized withheld for sale.

3. Primary recognition of non-current assets and group of disposal as withheld for sale is carried out for date when concerning assets, groups of disposal are met the conditions given in Item 1 of this Section or for date of receipt of the assets acquired with sales objective.

4. If non-current assets, group of disposal are recognized withheld for sale after date of balance, then such recognition is performed for the following date of balance.

If such recognition happens after date of balance, but before approval of the financial reporting, then information on the non-current assets, group of disposal withheld for sale reveals in notes to the financial reporting.

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