Home  Journals  International Accounting  34(328) - 2014 September

Sources of financing the innovation activity of corporations: an accounting aspect

Available online: 6 October 2014

Subject Heading: ISSUES ON ACCOUNTING

JEL Classification: 

Pages: 2-7

The problems of systematizing the information of corporate accounting and reporting are the subject of the research. The purpose of the article is to substantiate the areas of corporate accounting and reporting development in the field of data generation and disclosure on the sources of financing the innovation activity of corporations. The research methodology involves the analysis of the provisions of the domestic statutory regulation of accounting and developing recommendations on providing the users of corporate financial statements with reliable information that characterizes the activities of corporations. Based on the results of the research, the author has developed proposals related to reorganization of corporate accounting for internal and external sources of funding, including depreciation charges, retained earnings, public assistance and borrowed funds. The author also proposes the methods of systematizing the information that reflects the use of depreciation charges as a source of innovation activity of corporations. Having researched the problems of recording and disclosing the use of retained earnings in the process of innovation activities of corporations, the author proposed a number of recommendations on developing accounting policies. The article also examines the issues of systematizing the information on external sources of financing the innovation activities of corporations, in particular the government assistance, loans and borrowings. The author has developed recommendation on recording expenditures incurred under investment projects that are subject to be included in the historical cost of an investment asset. Having analyzed the problems of systematizing the information on transaction costs associated with financing the innovation activities of corporations, the author proposed the techniques of recording these costs in the corporate books and financial statements. To increase the transparency of corporate reporting the article presents a procedure for disclosure of other expenses associated with innovation activities of corporations. There are proposals to complement notes to corporate financial statements with the information on the sources of financing innovation activities of corporations, which is generated in a special table.

Keywords: R&D costs, intangible assets, fixed assets, financing, innovation, modernization, production

References:

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