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UDC 338.246.025.2 DOI: http://dx.doi.org/10.20534/AJH-17-1.2-219-224
N. N. Khakhonova 1
1 Rostov State University of Economics, Rostov-on-Don, Russian Federation
CONCEPTUAL BASES OF REFORMING OF ACCOUNTING AND ANALYTICAL SUPPORT IN THE MANAGEMENT OF COMMERCIAL ORGANIZATIONS IN RUSSIA
Abstract
Objective: The dynamism of information economy, integration processes related to the appearance of the world market of capital, harmonization and convergence of accounting systems inevitably conduce to the establishment of a new accounting paradigm. The problems, appearing in the process of globalization of economies of different countries, raise the requirements to information, which reflects the financial situation and financial results of the economic activity of a corporation. Accounting information turns into a production factor rationalizing the capital usage. The necessity to consider the issues of formation of accounting analytical support ofbusiness entities management within the system approach and analysis determined the relevance of the chosen subject
Methods: generalization, observation, theoretical cognition, historical method.
Results: The ways of solving the problems have been identified. The original classification of the principles of the accounting and analytical support buildup for the organization management has been compiled. We have analyzed the existing approaches and individual points of view to determine the content of this concept, and put forward our individual interpretation.
Scientific novelty: The main advantage of the authors' interpretation of accounting and analytical support is in the improvement of general methodology as well as creating the ground for developing techniques of record keeping, analysis and control on the basis of international experience, which ensures the continuity of the process of tactical and strategic decision making, well-timed adjustments of the development strategy of the organization in the long term, contributing to the efficiency of administrative decisions taken by the management.
Practical significance: The results of the research described in the article can be used in the training for bachelors, specialists and masters in the University, in the system of credits and advanced training for professional accountants, auditors, internal auditors.
Keywords: Accounting, accounting and analytical system, accounting subsystem; accounting systems, accounting information, analytical information, harmonization of the global economy.
introduction
Currently the domestic accounting is going through a difficult and important period, i. e. reformation of the system of accounting and reporting. The issues of improving business entities activity management, including its accounting analytical support, transfer from the stage of long-term discussions to the stage of practical implementation.
For efficient development of business activities in Russia, it is necessary to have an accounting information system adequate to market relations which makes it possible to form relevant information, to analyze it and to take reasonable management decisions. However, the drawbacks characteristic of modern accounting sys-
tems caused the emergence of new types of accounting of such directions as strategic management accounting; their development takes place within the framework of regular convergence of accounting and economic approaches. The necessity to consider the issues of formation of accounting analytical support ofbusiness entities management within the system approach and analysis determined the relevance of the chosen subject.
Theoretical and methodological basis of the research consists of the works of local and foreign researches and leading experts on the methodology of organizing the accounting and analytical systems and the AAMS as well as techniques of accounting, analysis and audit: Bernstein L. A., Bertonesh M., Cheng F. Lee, Drury C.,
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Gorman Tom, Helfert E., Hendriksen E. S., Hicks J. R., Holt Robert N., Horngren Ch. T. [1-10]. On the basis of systematic approach, the article has developed and justified the scientific and methodological provisions aimed at improving the theory and practice of formation and use of the AAMS within business entities in order to increase efficiency of decision making.
RESEARCH FINDINGS
As a rule, an accounting system is understood as a complex task-oriented science with its wide and narrow scientific methods reflecting the multilevel economic system, which possesses the following essential elements: accounted, formed and perceived informations-accounting procedures (basic and subsidiary accounting processes, methods of information search, collection, storage, processing, supplying and dissemination and means of implementation of such processes and methods); regulatory legal and organizational support-accounting personnel; necessary infrastructure.
For accounting in the management system to fulfill its multipurpose function in the company management it is necessary for it to be implemented on the basis of scientifically grounded methods. The application of these or those methods depends on a level of management development in a company, scope of production, functional profile of accounting events, application of organizational and technical means in an accounting process, requirements of the integrated automated information system to the accounting information.
In order to obtain the information required for the production and economic activity management, a company creates a bookkeeping accounting information system (BAIS) on the basis of modern information technologies.
In the bookkeeping accounting information system the data about economic activities of a company are collected and registered in primary documents, the data are processed and accumulated, financial and economic indicators of reports are formed, and information is transmitted to users for analysis and decision-making.
The main task of BAIS functioning in a company is to provide the company management with financial information for well-grounded decision-making when choosing alternative variants of limited resources use.
An integration of different types of accounting (operating, bookkeeping and statistic accounting) takes place in BAIS on the basis of unified source information. But there is no fusion of these types of accounting because each of them has its functions and solves its tasks.
Speaking of formation of the integrated information environment of a company in the interpretation which we have given above, i. e. the integrated information environment of accounting data about the company activity, it is logical to suppose that its formation starts with the determination of accounting policy of a company. Accounting policy of a company is understood not as an accounting document, which should be in any company according to the requirements of the current legislation, but as general strategic tendencies of how accounting is performed in a company: what, how, in what forms and with what type of recurrence is accounted. Besides, accounting is understood both as bookkeeping and management accounting.
As a matter of fact, when we talk about an accounting policy of a company, we mean the system of planning and control of its activity for the purpose of management.
In our view, the integrated information environment of an economic entity is a basis of the management system, this environment constantly changes, new information flows appear, which are conditioned by wide implementation of computer aids and widening of production and financial relations of a company. The functional purpose and type of the information system depend on that element the interests ofwhich and on what level it serves.
Any information system within the existing integrated information environment of business entities of Russia is based on the relevant information support, which presents a complicated dynamic complex process meeting the information needs of management and performs the functions of rationalization of activities of its apparatus.
A system of information support is a total of implemented decisions concerning the scope, placement and forms of information organization. It includes six interconnected information subsystems: planning, organization, accounting, control, analysis and regulation. This system is to bridge information gaps in strategic, current and operational business management and to secure a unified contour of regulation of its activity [11; 12].
In our view, one of the components of information support is the accounting analytical support. The system of bookkeeping unites accounting and analytical operations in one process. At the same time we observe improvement of both general methodology and regulations of accounting and analysis for reasonable usage in the integrated accounting analytical system. Continuity of this process and application of its results in a company are necessary for management decision-making.
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In the course of study, we found out that there is a big diversity of terms used in theory and practice and similar in their content to the term of accounting analytical support. In our study we systematized the terms and grounded the reasonability of usage of the term 'accounting analytical support — AAS'.
Let us consider in details the existent approaches and points of view on this issue.
O. A. Rybalko and T. G. Sheshukova are convinced that a total of accounting elements and connections between them, formed to achieve the objective of meeting information needs of users, makes the basis of the accounting system [13].
It is possible to single out in the system of accounting support the accounted, formed and perceived information; accounting procedures (main and subsidiary accounting processes, methods of information search, collection, storage, processing, supplying and distribution and means of implementing these processes and methods); analytical procedures (comparison with regulatory, planning documents and in dynamics, factor analysis of prime cost, balance method, expert method), regulatory legal and organizational support; accounting personnel; required infrastructure.
Thus, development of accounting support of management implies improvement of methodology of accounting, which is inseparably connected with an evolution process of accounting.
If accounting supplies information, then analysis gives a form to it suitable for decision-making. Analysis as a management function includes the assessment of internal and external factors of the situation, general tendencies of the development of economic processes, possible reserves of the production efficiency increase.
When organizing a continuous analysis, its oper-ability and effectiveness increase because the analysis directly follows the accounting and is carried out in the course of economic financial accounting. Meanwhile, the subsystem of analytical support of the economic activity management turns into a constantly functioning factor of the production efficiency increase due to activation of the whole information fund of a company.
It is necessary to maintain the integrity of analysis on the assumption of decentralized processing of information, i. e. to unite the process of information processing with the process of decision-making. Such interpretation of the purpose of accounting and analysis is important and achievable. At that, not only end results will be as-
sessed but also the course of economic activity, which at the stage of planning is considered as a total of technological, technical, organizational and management preparation and service of a production process in industrial enterprises [14].
All accounting processes as well as system elements defining the quality of functioning of an accounting analytical system (methodology, organization, technology) shall be harmoniously integrated in the unified economic information field, which is a system of a higher level for accounting.
The significance of a continuous accounting and analysis for economic processes is closely connected with a possibility of influencing them by means of making necessary management decisions in the operational mode.
The modern conception of AAS provides for accounting, analysis and control of not only internal economic operations in business processes but also the analysis of parameters of external macro environment. AAS should reflect both direct and feedback relations allowing to adapt information to the changing requirements of internal and external users of information.
Working continuously the accounting analytical support increases the quality and broadens the field of practical application of accounting information, in the end effect positively influencing the quality of the prepared and presented reporting and reporting indices themselves, i. e. the effectiveness of accounting information for third-party users.
The development of accounting analytical support of management shall be considered in the context of dialectical laws (law of unity and conflict of opposites, law of transformation of quantitative changes into qualitative changes, and law of negation).
Thus, the main objective of the accounting analytical support in any company, formed in the course of accounting organization, is the support of effectiveness of accounting and control system functioning in a company, provision of the highest rank management of a company with reliable data for effective and reasonable decision-making.
The reform of the accounting in Russia started with the determination of new objectives and tasks of accounting.
In the middle of the 90s of the last century Russia started to take an active part in the process of international economic integration and formation of the market infrastructure. It made it possible for Russian companies
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and organizations to take part in: foreign economic activity of the country and, consequently, payments in foreign currencies; joint activities; operations of acquisition and disposal of property in trust management and operational management, etc.
A unique accounting system which totally corresponded to the requirements was established in Russia. Under the conditions of planned economy and centralized management the national system of accounting with the following distinguishing features was formed:
- governmental control over accounting in the country by means of adoption of regulatory documents obligatory for employment;
- full standardization and unification of accounting procedures and accounting documents;
- integrated system of accounting reporting.
The main objective of accounting was safekeeping
and rational use of the state property.
During all years of the socialist economy in the country the accounting was constantly developing and improving in an 'evolutional' way: its new forms were elaborated and implemented, the cards of accounts were reviewed and corrected, the forms of accounting were changed, mechanization and automation of accounting were introduced.
Though, in spite of obvious advantages of this accounting system, under new economic conditions the old system was doomed. With the beginning of restructuring of the Russian economy it was needed already not to improve this system of accounting, but to update it on the new methodological basis — IFRS.
In 1998 the government of the Russian Federation took the decisions related to the reformation of accounting in accordance with the international financial reporting standards (decree No. 283 dated March 6, 1998, orders No. 382-p and No. 587-p dated March 21, 1998 and May 22, 1998). The most important constituent of the reform was improvement of accounting in business entities (decree of the government of the Russian Federation No. 1373 dated October 30, 1997).
The intensive and long-lasting work aimed at formation, discussion and adoption by the decree of the government of the Russian Federation No. 283 dated March 6, 1998 resulted in the adoption of the Program of accounting reformation according to IFRS. It was stated that the changes taking place in the course of economic reforms in the Russian Federation required the adequate transformation of accounting.
Therefore, in accordance with the Program, the objective of the accounting system reformation was to bring the national accounting system to conformity with the requirements of the market economy and IFRS, and the tasks of the reform were the following:
- to form the system of standards of accounting and reporting providing users (first of all, investors) with useful information;
- to secure reconciliation between the accounting reform in Russia and main tendencies of standards harmonization on the international level;
- to render the methodic assistance to organizations in comprehension and implementation of the reformed accounting model.
The question of importance was what to take as a basis when reorganizing accounting — accounting rules of some particular country or IFRS. After debating it was acknowledged that implementation of IFRS in the Russian accounting system was conditioned by:
1) transformation of the Russian economy into an integrated constituent of the world economic system (macroeconomic aim at attracting foreign investments, entry of Russian business entities into the world capital markets, joint business of Russian and foreign organizations);
2) opportunity to use the already accumulated world experience of standards elaboration, which are accepted by public authorities or professional organizations regulating national accounting rules in the majority of countries, in order to make an effectively functioning system, which meets the needs of the market economy, in the shortest time possible.
Many Russian companies already now prepare financial reporting on their own in accordance with the requirements of the Russian law as well as in accordance with the international standards.
Presently the overwhelming majority of large companies (with proceeds exceeding 15 billions rubles) prepares reporting in compliance with IFRS, which is in demand by both shareholders and banks. The majority of companies with middle- and small-capitalization also prepare their reporting according to IFRS, and their number is constantly growing and has reached 75% [15].
CONCLUSIONS
To summarize the above-stated, it should be acknowledged that the result of the work on convergence of accounting on the international level is a process of for-
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mation of the International accounting system which is based on general accounting principles and generates integrated financial accounting and reporting standards for comparability of the activity of companies of all countries in the world.
The improvement of national accounting systems on the basis of convergence will make it possible to bring together the dynamic characteristics of the activity, taking less economically developed countries to the level of the more developed ones. The information obtained in the harmonized accounting systems and possessing equal qualitative characteristics will generate objective conditions for speeding-up positive processes and business development in the region in general.
The globalization of the economic life, manifesting itself in development, expansion, intensification of the world production, global market, growth of signifi-
cance of the information factor, increase of mobility of the spare capital, conditions the necessity to determine the place of national accounting systems in the global information complex. In the given context, it is important for particular countries, especially in the period of developing economy, to solve the problems of transfer to IFRS or maintenance of national accounting and reporting systems, determination of economic effectiveness and cover of expenditures on implementation of IFRS, provision of economic security of the country during the transfer to international accounting norms, etc., which have not been sufficiently studied in the accounting literature. Therefore, developments on the above-mentioned problems are considerably topical, and attempts to solve them will allow predicting the development of the integrated international system of accounting indices formation in the future.
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Information about the authors
Natalya N. Khakhonova. Doctor of Economics, professor, Professor of the Department of Accounting Rostov State University of Economics (RINH).
Address: 24 «B» Radialne Str., 344004, Rostov-on-Don,, Russia, tel.: +7 (928) 179-17-03
E-mail: n_khakhonova@bk.ru
ORCID: http://orcid.org/0000-0003-3327-4561
