PBU 4/99 "Accounting statements of the organization": composition, content, regulation and order

2024 Author: Howard Calhoun | [email protected]. Last modified: 2023-12-17 10:16

Enterprises in the status of a legal entity, in accordance with the legislation of the Russian Federation, are required to keep records. One of the main regulations governing this procedure is PBU 4/99. What are its highlights? What should be the structure of reporting documents in accordance with the norms that are fixed in this regulatory act?

What is PBU 4/99 regulation?

The considered source of law was put into circulation by the Order of the Ministry of Finance of the Russian Federation No. 43n, which was issued on July 06, 1999. This normative act is classified as a Regulation. Its full name is the Accounting Regulation "Accounting Statements of the Organization" (PBU 4/99).

Why do we need an appropriate source of law? This normative act defines the structure, as well as the methodological foundations for maintaining accounting records by enterprises.

The jurisdiction of the considered source of law extends to all legal entities, except for banks, as well asstate and municipal structures. Also, PBU 4/99 may not be applied if financial statements are generated by an enterprise for internal needs, in order to provide statistical reporting and accounting documentation by business entities to interested parties in a manner that is not directly regulated by Order of the Ministry of Finance No. 43n.

The document in question should not be used in drafting:

• reporting generated by an economic entity for internal purposes, as well as compiled for statistical institutions;
• information prepared by a banking organization in accordance with established requirements, unless otherwise provided by separate rules.

It can be noted that the corresponding source of norms can be used directly by the Ministry of Finance in order to:

• definitions of standard reporting forms, as well as guidelines for them;
• special reporting for small businesses and NPOs;
• establishing rules for creating consolidated reporting, as well as documentation when changing the status of an enterprise.

Thus, the standard in question is a universal source with a fairly broad jurisdiction.

The considered source of law establishes a number of definitions that it is desirable for enterprises to adhere to when compiling reports.

Definitions according to RAS 4/99

We are talking about definitions of terms such as:

• accounting statements;
• reporting date,period;
• user.

Accounting statements, in accordance with the provisions of PBU 4/99, should be understood as a single intra-corporate system of knowledge about the company's financial position, as well as the results of the company's business activities, compiled on the basis of information that is reflected in accounting.

The reporting period in RAS 4/99 means the period within which the corresponding type of reporting should be generated in the organization. The reporting date is, in turn, the date on which the business entity is required to provide reports.

One more term, which is revealed in the considered source of law - the user. This is understood as an individual or organization that is interested in obtaining information about an economic entity.

PBU 4/99 "Accounting statements of the organization" defines the composition of the relevant documentation of the enterprise, as well as the requirements for it. Consider them.

Composition of reporting

In accordance with the provisions of PBU 4/99 "Accounting statements of the organization", the company's financial statements include:

• balance;
• profit and loss report;
• special annexes to the balance sheet and report;
• explanatory note;
• in cases provided for by law - an auditor's report.

In turn, the considered source of law establishes a wide range of requirements for the company's financial statements. Let's studythem.

Requirements for documents

In accordance with PBU 4/99 "Accounting statements of the organization", the documents that are generated by the enterprise must reflect reliably and in the required completeness the idea of the state of affairs in the business, the results of the company's economic activities, and trends characterizing the economic performance of the company.

The main criterion for the completeness and reliability of reporting is its compliance with the rules fixed by regulations adopted by the competent authorities. If the formation of the relevant documents reveals the insufficiency of certain data, then the company must include the necessary additional indicators and explanations in the reporting.

In extreme cases, PBU 4/99 allows this scenario, the enterprise may deviate from the established norms if it is not possible to obtain the necessary indicators for objective reasons.

Information that is collected in the course of reporting should be neutral. Its application should not affect the decisions made by competent persons in the course of evaluating financial results.

The most important requirement for the financial statements of a legal entity is that it should include indicators reflecting the results of the economic activities of all its divisions, representative offices, as well as other structures, including those that have separate balance sheets.

The enterprise needs to provide the most importantcompliance with the Accounting Regulation “Accounting Statements of an Organization” (PBU 4/99), which consists in the consistent formation of documents, taking into account the continuity of the structure of the form, in which indicators are recorded for different reporting periods. The forms of documents used as the basis for drawing up a balance sheet, a statement fixing profits and losses, as well as sources supplementing them, must therefore be permanent. They are subject to change in exceptional cases. As an option - if the type of activity of the company changes. At the same time, the organization must be ready to justify the corresponding changes through separate notes to the balance sheet, as well as a profit and loss statement.

Accounting statements, their composition and content (Regulations on Accounting PBU 4/99 contains the relevant rules) should be formed taking into account the continuity of indicators for different reporting periods. If discrepancies are found between the relevant data, the accountant can make the necessary adjustments to certain indicators. At the same time, information about it must be reflected in the supplements to the balance sheet and the report reflecting the profits and losses of the enterprise.

Reflection of economic indicators in reporting: nuances

There are a number of nuances that characterize the fixation of key indicators in the financial statements - they are also provided for by the document "Accounting statements of the organization" PBU 4/99. Briefly about them can be notedfollowing. Indicators of the assets, liabilities, revenues and expenses of the firm must be shown separately if they are very important for a reliable assessment of the state of affairs in the firm. In turn, these indicators can be reflected in the supplements to the balance sheet and report, if they are not of particular importance for assessing the state of the business.

Reporting date and year

In accordance with the normative source under consideration, when generating accounting documentation, an enterprise should keep in mind that the reporting date should be considered the last calendar day of the corresponding period. The reporting year corresponds to the period from January 1 to December 31. The first reporting year for a new organization is the period from the date of registration of the company until December 31. If the company was established after October 1, then the first reporting year for it corresponds to the period from the date of registration with the state authorities until December 31, thus, the next year.

Accounting statements: other requirements

Let's consider other significant requirements for the formation of financial statements in accordance with PBU 4/99. So, it should be noted that each of its components - a balance sheet, a report, additions to them, an audit report - must contain:

• name;
• reporting date or reporting period;
• name of company providing documents;
• information about the legal form of the business;
• format for reporting indicators.
• in Russian;
• indicate indicators in rubles.

Relevant reporting must be certified:

• head of the firm;
• chief accountant or other employee exercising accounting authority.

Balance structure

It will be useful to study the structure of two key accounting documents - the balance sheet, as well as the report, which reflects the profit and loss of the company. Let's start with the first source.

The balance sheet contains an asset and a liability. The corresponding indicators characterize the economic position of the company at the reporting date. As for the assets and liabilities of the firm, they should be classified into short-term and long-term. The first includes those whose duration does not exceed 12 months. To the second - on the contrary, those that can be repaid by the obligated party 12 months after the conclusion of the contract and later.

Report structure

The next most important document is a report that reflects profit and loss figures. Using this source, in particular, the classification of income can be carried out on the basis of PBU 4/99 "Accounting statements of the organization". The document under consideration should reflect the results of the company's economic activities for the reporting period. The main indicators in itcorrelate, therefore, with income and expenses, which are classified into ordinary and other.

Explanations to the balance sheet and report

Another important type of sources included in the company's financial statements are explanations to the balance sheet and the statement reflecting the company's profit and loss. The relevant additions are intended to disclose the information that relates to the accounting policy of the company and is necessary for the interested parties to present a reliable assessment of the financial performance of the company.

If the explanations need to reflect deviations from the rules made by the competent specialist of the company when compiling reports, the reason for the assumption of this deviation is recorded. In addition, the firm needs to reflect the financial consequences of allowing non-compliance with the rules of law governing the preparation of financial statements in enterprises.

Additions to reporting sources of accounting should reflect information that relates directly to the economic activities of the organization, and disclose them in the context of the information that is confirmed by accounting data. Thus, a person interested in obtaining the sources in question expects, first of all, to increase the reliability of information about the economic situation at the enterprise.

Mandatory criterion for the relevant additions to PBU 4/99 "Accounting statements of the organization" is their compliance with the law, as well as internal regulations, if required based on the management policy of the corporation. If from any norms to financiershad to be abandoned, this should be recorded in the addenda under consideration. Thus, the relevant documents are supposed to be transparent to any interested parties.

It can be noted that the legal act in question may correspond with others that regulate accounting at the enterprise. In this case, the financier needs to have prompt access to the relevant sources of norms in the most recent edition, as well as to comments, explanations and, if necessary, jurisprudence on the use of the provisions of these sources of law.