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On the impact of IFRS on results of financial analysis of organizations

Vol. 20, Iss. 22, NOVEMBER 2017

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Received: 10 April 2017

Received in revised form: 21 April 2017

Accepted: 4 May 2017

Available online: 29 November 2017


JEL Classification: G32

Pages: 12881303

Gordeeva O.G. Cheboksary Cooperative Institute (Branch) of Russian University of Cooperation, Cheboksary, Russian Federation

Serebryakova T.Yu. Cheboksary Cooperative Institute (Branch) of Russian University of Cooperation, Cheboksary, Russian Federation

Importance The main disadvantage of IFRS is in subjectivity of estimates of assets and liabilities. Methods of financial analysis, and especially the permissible values of key indicators are determined in relation to financial statements generated under IFRS. However, in our country, these indicators for various purposes, including bankruptcy proceedings, are determined based on financial statements prepared under Russian Accounting Standards. The findings show that restatement of financial statements does not change conclusions about financial condition of the organization. Further investigation reveals the validity of these conclusions.
Objectives We use the data of Russian companies preparing their IFRS-based financial statements on the basis of transformation of their RAS-based financial statements to find the extent of difference in figures characterizing the financial standing of these companies under the said reporting formats.
Methods The study draws on general scientific methods, like systems approach, logical generalization, analysis, synthesis and hypothesis.
Results In the presence of material differences in financial indicators, the results of ratio analysis of financial statements prepared under RAS and IFRS enable to make the same conclusions about the financial standing.
Conclusions and Relevance The findings help focus on improving the criteria for evaluating the financial condition of domestic companies for various purposes, regardless of International Financial Reporting Standards.

Keywords: fair value, IFRS, analysis, reporting, financial statements


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