Document from CIS Legislation database © 2003-2022 SojuzPravoInform LLC

Registered by

Ministry of Justice of Ukraine

June 23, 2001

No. 539/5730

ORDER OF THE MINISTRY OF FINANCE OF UKRAINE

of June 18, 2001 No. 303

About approval of the National provision (standard) of financial accounting 23 "Disclosure of information of rather related parties"

(as amended on 29-09-2020)

On accomplishment 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, and according to articles 1 and 6 of the Law of Ukraine "About financial accounting and the financial reporting in Ukraine" PRIKAZYVAYU:

Approve the National provision (standard) of financial accounting 23 "Disclosure of information of rather related parties" approved by Methodological council on financial accounting of the Ministry of Finance of Ukraine which is applied.

Deputy minister

V. V. Reguretsky

 

Approved by the Order of the Ministry of Finance of Ukraine of June 18, 2001 No. 303

National provision (standard) of financial accounting 23 "Disclosure of information of rather related parties"

General provisions

1. National provision (standard) of financial accounting 23 "Disclosure of information of rather related parties" (further - the National provision (standard) 23) determines methodological bases of forming of information on transactions of the related parties and its disclosure in the financial reporting.

2. Regulations of the National provision (standard) 23 are applied by the companies, the organizations and 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) concerning transactions of the related parties.

3. As the related parties are considered:

3.1 the companies which are under control or significant influence of other persons;

3.2 the companies and physical persons which directly or indirectly exercise control over the company or significantly influence its activities, and also close members of the family of such physical person.

The list of the related parties is determined by the company considering essence of the relations, and not just the legal form (essence prevalence over form). Relations between the related parties it, in particular, relations: maternal (holding) and its affiliated enterprises; joint business and control participants of joint activities; company investor and its associates; the companies and physical persons which exercise control or have significant effect on this company, and also the relations of this company with close members of the family of each such physical person; the company and its head and other persons who belong to the leading managerial personnel of the company, and also close members of the family of such persons.

4. Terms which are used in provisions (standards) of financial accounting have such value:

Associate - the company on which the investor has significant effect and which is not affiliated or joint business of the investor.

Close family members - the husband or the wife and relatives (recognized such according to the legislation) of physical person, being the related party which can influence or are under the influence of such physical person concerning decision making on financial, economic and commercial policy of the company.

Transactions of the related parties - transfer of assets or obligations one related party to other related parties.

The related parties - persons, the relations between whom cause possibility of one party to control another or to perform significant effect on adoption of finance and operational solutions by other party.

The leading managerial personnel - the personnel responsible for management, planning and monitoring activities of the company.

Transactions of the related parties

5. In particular, belong to transactions of the related parties:

5.1 acquisition or sale of finished goods (goods, works, services);

5.2 acquisition or sale of other assets;

5.3 transactions according to agency agreements;

5.4 rent transactions;

5.5 transactions according to license agreements (transfer of objects of industrial property and so forth);

5.6 financial transactions;

5.7 provision and receipt of guarantees and pledges;

5.8 transactions with the leading managerial personnel and with his close family members.

6. Assessment of assets or liabilities in transactions of the related parties is performed in particular by such methods:

6.1 the compared not controlled price;

6.2 resale prices;

6.3 "expenses plus";

6.4 book value.

7. By method of the compared not controlled price the price which is determined by the price of similar finished products (goods, works, services) which are sold to the buyer who is not connected with the seller in case of usual conditions of activities is applied.

8. By method of resale price the price of finished goods (goods, works, services) less the corresponding markup is applied.

9. By the "expenses plus" method the price which consists of cost of finished goods (goods, works, services) which is determined by the seller, and the corresponding markup is applied.

10. By method of book value assessment of assets or liabilities is performed at book value which is determined according to the relevant provision (standard) of financial accounting.

Disclosure of information

11. Such information is provided in notes to the financial reporting in the presence of transactions of the related parties:

11.1 nature of the relations between the related parties;

11.2 types and amounts of transactions (amount or share in total amount) of the related parties;

11.3 the used evaluation methods of assets and liabilities in transactions of the related parties;

11.4 the amounts of receivables and payables on transactions of the related parties.

12. If one related party exercises control or is under control of other related party, then information on nature of the relations of the related parties is provided irrespective of availability of transactions between them.

13. Information, is stipulated in Item 11 National provisions (standard) 23, can not to be provided in notes to:

13.1 consolidated financial statements of rather intra group transactions;

13.2 the financial reporting of the parent (holding) entity if it is made public together with consolidated financial statements;

13.3 the financial reporting of affiliated enterprise which is legal entity by the legislation of Ukraine and is in complete property of the parent (holding) entity which also is legal entity by the legislation of Ukraine and makes public consolidated financial statements;

14. Information on transactions with associates which are considered by the investor by method of equity participation is provided in the financial reporting according to Item 11 of the National provision (standard) 23.

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