Ministry of Justice of Ukraine
June 21, 1999
of May 28, 1999 No. 137
About approval of the National provision (standard) of financial accounting
In pursuance of the Program of reforming of the system of financial accounting using international standards approved by the resolution of the Cabinet of Ministers of Ukraine of October 28, 1998 No. 1706, I ORDER:
1. Approve the National provision (standard) of financial accounting 6 "Error correction and changes in financial statements" (further - the Provision (standard) 6) approved by Methodological council on financial accounting under the Ministry of Finance of Ukraine which is applied.
2. Determine that the specified National provision (standard) 6 is applied to accounting records concerning transactions which happen since 2000.
3. Provide that other regulations of the Ministry of Finance of Ukraine on financial accounting are effective in part which does not contradict the National provision (standard) 6.
A. V. Litvin
Approved by the Order of the Ministry of Finance of Ukraine of May 28, 1999 No. 137
1. This National provision (standard) determines procedure for error correction, introduction and disclosure of other changes in the financial reporting.
2. Regulations of this National provision (standard) are applied in the financial reporting of the companies, organizations and other legal entities (further the companies) all patterns of ownership (except budgetary institutions and the companies which according to the legislation constitute the financial reporting under International Financial Reporting Standards).
3. Terms which are used in National provisions (standards) of financial accounting make such sense:
Date of balance - date for which the balance of the company is made. Usually date of balance is the end of the last day of the accounting period.
Accounting assessment - provisional estimate which is used by the company for the purpose of expense allocation and the income between the corresponding accounting periods.
Event after date of balance - event which takes place between date of balance and approval date management of the financial reporting prepared to the bringing to publicity which affected or can affect financial condition, results of activities and cash flow of the company.
Error correction and changes in accounting estimates
4. Error correction, the financial statements allowed in case of creation in previous years, is performed by adjustment of balance of retained earnings for the beginning of accounting year if such mistakes influence the size of retained earnings (uncovered loss).
5. Error correction which belong to previous periods requires repeated display of the relevant comparative information in the financial reporting.
6. Accounting assessment can be reviewed if circumstances on which this assessment was based change, or the additional information is obtained.
7. Consequences of change in accounting estimates should be included in the same Article of the report on financial results which was applied to display of the income or expenses connected with object of such assessment earlier.
8. Consequences of change of accounting estimates should be included in the report on financial results in that period in which change took place, as well as in subsequent periods if change influences these periods.
Changes in accounting policy
9. Accounting policy can change only if authorized requirements, requirements of body which approves provision (standards) of financial accounting change, or if changes provide reliable display of events or transactions in the financial reporting of the company.
10. Establishment of accounting policy is not considered change of accounting policy for:
10.1. Events or transactions which differ on content from the previous events or transactions.
10.2. Events or transactions which did not happen earlier.
11. Accounting policy is applied concerning events and transactions from the moment of their origin, except as specified, provided by item 13 of this National provision (standard).
12. Influence of change of accounting policy on events and transactions of the expired periods is displayed in the reporting in the way:
12.1. Adjustments of balance of retained earnings for the beginning of accounting year.
12.2. Repeated provision of comparative information of rather previous accounting periods.
13. If the amount of adjustment of retained earnings for the beginning of accounting year cannot be determined authentically, then accounting policy extends only to events and transactions which happen after date of change of accounting policy.
14. If it is impossible to differentiate change of accounting policy and change of accounting estimates, then it is considered and displayed as change of accounting estimates.
Events after date of balance
15. Events after date of balance can require adjustment of certain Articles or disclosure of information on these events in notes to financial statements.
16. Events after date of balance which provide the additional information about determination of the amounts connected with conditions which existed for date of balance require adjustment of the corresponding assets and liabilities. Adjustment of assets and liabilities is performed by reversal and (or) additional records in accounting of the accounting period which display refining of assessment of the relevant articles owing to events after date of balance.
17. Events which take place after date of balance are specified conditions which arose after this date, do not need adjustment of articles of financial statements. Such events should be opened in notes to financial statements if lack of information on them affects capability of users of the reporting to do the corresponding estimates and to make decisions.
Dividends for the accounting period which are announced after date of balance should be opened in notes to financial statements.
18. If events after date of balance demonstrate intentions of the company to stop activities or about impossibility of its continuation, then the financial reporting is constituted without application of going concern principle.
19. The approximate list of events after date of balance is attached.
Disclosure of information in notes to financial statements
20. In notes to financial statements it is necessary to open such information concerning error correction which took place in previous periods:
20.1. Content and amount of mistake.
20.2. Financial statement line items of the expired periods which were counted for the purpose of repeated provision of comparative information.
20.3. The fact of the repeated bringing to publicity of the corrected financial statements or inexpediency of the repeated bringing to publicity.
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