Features of the insurance companies activities: from establishment to inspections by regulators

Insurance has great potential to contribute to the economic and social development of the country, reserves maneuvering, satisfy interests in protecting property and income of legal entities and individuals, and has received one of the leading roles in shaping the entire system of economic security of the country.

But at the same time, such a role becomes real only at the proper level of development of the insurance business, in order to achieve which this, it is necessary first of all to comply with current legislation in the field of financial services.

Valerii Bondar, General Director of HLB Ukraine, spoke in more detail about the activities of insurance companies and their control by regulators in the article «Features of the insurance companies activities: from establishment to inspections by regulators».

The article was published in the journal «JURIST&LAW» (No. 36, 2019).

The article is available in Ukrainian and Russian.

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Rest under the law. Problems of unused vacations

The holiday season is in full swing: our citizens choose between sea and mountains, domestic operators and foreign, standard tours and «savages» vacations. But there are people who can’t find in their own schedule even a week to stay outside the company. Their vacations are sometimes considered quarters. What are the risks for the company of non-compliance with vacation laws and how can they be avoided with minimal losses?

This question is answered by Sergiy Rogozniy, Deputy General Director on audit issues of HLB Ukraine, Head of the Finance and Internal Control Committee of the Federation of Professional Accountants and Auditors of Ukraine and Natalya Yanitskaya, Chief Auditor of HLB Ukraine, member of the Federation of Professional Accountants and Auditors of Ukraine in the article «Rest under the law. Problems of unused vacations».

The article was published in the journal «Taxes. Practice, clarifications, comments» (No. 7, 2018).

The article is available in Ukrainian and Russian.

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Revenue Recognition. What primary documents are needed?

The company sells goods delivered by the courier, as well as the sale of goods under commission agreements. What primary documents can be the basis for reflecting the proceeds received from the sale in accordance with IFRS and are there risks of non-recognition of income in accounting? This question is answered by Maria Timofeeva, chief auditor of HLB Ukraine, in the article «Revenue Recognition. What primary documents are needed?».

The article was published in the journal «Taxes. Practice, clarifications, comments» (No. 1, 2018).

The article is available in Ukrainian and Russian.

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For whom is the application of IFRS mandatory since 2018, and what are the features of the preparation of first IFRS reporting?

The amendments made by Law No. 2164 to the Law on Accounting relate to the use of IFRS for accounting and financial reporting. For whom is the application of IFRS mandatory from 2018, and what are the features of the preparation of first IFRS reporting? You can find the answer to this question by reading an article by Sergiy Rogozniy, Director of the Audit Department of HLB Ukraine, and Svetlana Zubilevych, Head of the FPAA Committee on Vocational Education and Certification – «First IFRS Reporting: Preparation Procedure and Structure».

The article was published in the journal «Handbook of the Economist».

The article is available in Russian and Ukrainian.

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5 steps of revenue accounting or how to determine income under the new IFRS 15

«From January 1, 2018, IAS 18 «Income» and IAS 11 «Construction Contracts» expire. They are being replaced by a single universal standard – IFRS 15 «Revenue from Contracts with Customers» which radically changes the criteria for recognizing revenue», said Sergiy Rogozniy, Deputy General Director on Audit issues of HLB Ukraine, and Olga Karpacheva, financial analyst, certified accountant, in the article «5 steps of revenue accounting or how to determine income under the new IFRS 15». This article opens a series of publications on changes in revenue recognition and disclosure in IFRS financial statements.

The article was published in the newspaper «All About Accounting» (No. 95, 18.10.2017).

The article is available in Ukrainian and Russian.

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European choice for Ukrainian accountants and auditors on the transition to IFRS

The official website of the international audit network HLB International published an article by Sergiy Rogozniy, Deputy General Director of HLB Ukraine, on the European choice for Ukrainian accountants and auditors to switch to International Financial Reporting Standards (hereinafter – IFRS).

By signing the Association Agreement with the EU in 2014, Ukraine has committed itself to harmonizing its legislation with European standards. And above all, this applies to business legislation, including the scope of financial reporting and auditing. In 2017, the 3-year transitional period established by the Association Agreement ended for the adaptation of our legislation to EU Regulation No. 1606/2002 on the transition to IFRS and EU Directive No. 2006/43/EU regarding statutory audit, the aim of which was to «create a fully functioning market economy and trade stimulation «(Article 337 of the Association Agreement).

In order to fulfill its obligations, Ukraine has amended the Law of Ukraine «On Accounting and Financial Reporting in Ukraine» since 2018. Along with the new Law «On the audit of financial statements and auditing activities», they have a significant impact on the activities of accountants and auditors in the country.

Small enterprises do not fall under the changes, in which two out of the three indicators will not exceed the limit:

– annual revenue does not exceed 8 million EUR;

– total assets of not more than 4 million EUR;

– staff not more than 50 people.

If an enterprise «fits in» with these indicators and does not participate in the insurance business, in other financial services, and is not an issuer of securities, then with a probability of 99% nothing will change for it. That is, about 1% of 1 million Ukrainian legal entities will have to worry.

It is these 10-15 thousand legal entities that produce more than 80% of GDP that should be prepared for new standards of quality of financial information. The organizational form of the LLC or PJSC is no longer exempted from the mandatory audit of financial statements, and large enterprises (revenues of more than 40 million EUR, assets of 20 million EUR, 250 employees) will need to study and adopt IFRS for financial reporting and daily accounting.

In fact, the transfer of financial statements to IFRS will take about a year, during which it is necessary to restructure business processes, complete the formation of accounting policies and accounting programs, reassess long-term assets, and train staff. This, of course, needs investment: these costs for one year can be less than 3 thousand EUR for small enterprises, not taking into account the cost of the audit, or even hundreds of thousands of EUR for the giants of domestic industry.

Enterprises that refuse to conduct audits and publish financial reports on their web page (also from 2019) will face significant fines.

Such «victims» will increase business transparency and reduce the shadow sector, which, according to estimates of the International Monetary Fund in Ukraine, is 45% versus 18-22% in the Baltic countries and 7-15% in Japan, the USA, Switzerland and Singapore.

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Control: internal audit

Sergiy Rogozniy, Director of the Audit Department of HLB Ukraine, commented on the features of conducting an internal audit in the article «Keep Control: Internal Audit».

The article was published in the journal «Financial Director of the Company» (No. 8, 2017).

The article is available in Russian.

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The NBU’s initiative to strengthen the requirements for auditors contradicts the interests of banks

The tightening of requirements for audit firms and their employees, proposed by the National Bank of Ukraine, contradicts the interests of the banks themselves, as well as the audit community and the public.

This opinion was expressed in comments to the «Law and Business» publication by Valerii Bondar, Managing Partner of HLB Ukraine, member of the Audit Chamber of Ukraine, in connection with the publication by the NBU of draft amendments to the Regulation on the Procedure for the Register of Audit Firms Eligible for Bank Audits.

The article was published in the newspaper «Law and Business» (19.08.2017).

The article is available in Ukrainian and Russian.

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A company and business associations

About the company and business associations, as well as what to do with membership dues, says Halyna Neplyueva, senior auditor of HLB Ukraine, in the article «Enterprise and Business Associations».

The article was published in the magazine «Taxes».

The article is available in Russian and Ukrainian.

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Computer virus Petya.A: prevent financial sanctions

On June 27 this year, the computer virus Petya.A attacked Ukraine, as a result of which thousands of enterprises were deprived of the opportunity to file tax reports and register tax invoices. The question arose: how to prevent holding the company liable for violation of tax laws? We believe that the chances of proving the groundlessness of penalties from the SFS are quite high.

This is explained in the article by Mikhail Kocherov, partner, candidate of legal sciences, lawyer of HLB Ukraine.

The article is available in Ukrainian and Russian.

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Virus attack: what to do?

June 27, Ukraine was under a powerful hacker attack. The Petya.a virus (Mbr locker 256), which encrypts information on the hard drive, has affected both state and private enterprises. What difficulties did entrepreneurs face after infection and how to protect themselves from hacker attacks, explains Yevgeny Evtekhov, senior lawyer, attorney of HLB Ukraine.

The interview was published in the journal «Financial Director of the Company» (No. 7, 2017).

The interview is available in Russian.

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Promotions, discounts and bonuses: how to work with them

Many enterprises in their activities have various marketing activities aimed at attracting new customers, increasing sales and encouraging existing and wholesale customers. Of course, such events are very important for business entities, therefore, the issue of accounting and taxation of various promotional products will always be relevant. Olga Samuseva, partner, General Director of HLB Ukraine, comments on this issue in the article «Promotions, discounts and bonuses: how to work with them».

The article was published in the journal «Financial Director of the Company» (No. 7, 2017).

The article is available in Russian.

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Rent agricultural land: from contract to accounting

The specifics of agricultural activities and certain nuances associated with this issue, especially if it concerns land leases, as well as the regulatory requirements for concluding a lease with accounting and taxation features for certain transactions are described in the article by Sergiy Rogozniy, Director of Audit Department of HLB Ukraine, and Olga Karpacheva, financial analyst «Lease of agricultural land: from contract to accounting».

The article was published in the journal «Handbook of the Economist» (No. 6, 2017).

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Quality control system of auditing services: organizational aspects and successful evaluation practice

The article is devoted to the definition of organizational prerequisites for improving control and valuation of the quality of audit services in Ukraine based on the research and dissemination of international practice of valuation, cooperation with international audit companies and associations. The article emphasizes the need to coordinate the quality control of audit services at the level of a specific audit firm with domestic legislation and international standards.

The article is available in Russian and Ukrainian.

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IFRS is a universal business language

IFRS as a business development trend is discussed in an interview with Sergiy Rogozniy, Director of the audit department of HLB Ukraine.

The interview was published in the journal «Handbook of the Economist».

The article is available in Russian and Ukrainian.

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Comment on creation of the High Court for Intellectual Property

Yevgeny Evtekhov, senior lawyer of HLB Ukraine, commented on the possibility of creating a High Court for Intellectual Property in the article «Will Legislative Deficiencies Outweigh the Importance of an Intellectual Court?».

The commentary was published in the «Law and Business» newspaper (No. 39, 2017).

The article is available in Ukrainian.

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A lawyer will not be considered a private person on the Internet

Yevgeny Evtekhov, senior lawyer of HLB Ukraine, spoke about the specifics of adhering to the law of ethics in the article «A lawyer will not be considered a private person on the Internet, even if he warns about it».

The article was published in the «Law and Business» newspaper (No. 38, 2017).

The article is available in Ukrainian.

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Problems of applying the norms of professional ethics in the activity of the auditors of Ukraine

The article of Doctor of Economic Sciences, professor, DVNZ of «Kiev National Economic University named after Vadim Getman» V. Bondar about the problems of application of the norms of professional ethics in the activity of the auditors of Ukraine was published in the magazine «Statistics of Ukraine».

The article refers to professional ethics as a moral code and a set of rules of conduct. The code of professional ethics is necessary to ensure the confidence in the quality of the services provided by the representative of the profession.

Auditor ethics practically fixes and reflects a high degree of regulation of many aspects of moral activity of auditors. Much of the ethical provisions are reflected and enshrined in the laws, regulations and the code of professional ethics of the auditor. As a system of special knowledge about the morality of the auditor, ethics study the scope of his consciousness and behavior, moral relations and patterns of their formation. The professional maturity of the auditor is characterized not only by knowledge, skills and skills, but also by the appropriate level of morality of the individual, by the development of the moral requirements of his profession.

The study is devoted to numerous problems arising in connection with the lack of compliance with the principles of professional ethics by the auditors, provoking not only doubts about the reliability of the published findings, but also the global mistrust of users of financial statements in the audit profession. This, in general, creates obstacles to ensuring transparency of mechanisms for disclosure and verification of information by enterprises in Ukraine, does not contribute to the formation of an appropriate investment climate.

Based on the results of the study, the system of organizational support for creating an environment is substantiated adherence to the principles of professional ethics in the course of performing audit tasks on the basis of concretizing measures to identify and eliminate threats to the independence of the auditor. In this regard, the structure and content of the relevant organizational and administrative documentation, which is part of the internal system for quality control of audit services, is proposed.

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Valeriy Bondar spoke about HLB International’s management of electronic resources

Valerii Bondar, managing partner of HLB Ukraine, spoke about the features of electronic resources management at HLB International.

The article was published on the «Special Opinion» blog of the «Law and Business» newspaper.

The article is available in Ukrainian.

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Accounting for bioactive substances for IFRS: we disclose information in financial reporting

Due to the fact that the accounting of agricultural activities is very specific and has a number of nuances, when disclosing information in the financial statements, each IFRS specialist should be guided by IAS 41 «Agriculture». For more information on biological assets and how it should be reflected in financial reporting, read the article by Sergiy Rogozniy, Deputy General Director on Audit issues of HLB Ukraine, and Olga Karpacheva, Financial Analyst, Certified Accountant, «Accounting for Biological Assets under IFRS: Disclosing Information in Financial Reporting».

The article is available in Russian and Ukrainian.

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Biological assets: accounting biotransformation and harvest

In continuation to the article published in the newspaper «All About Accounting» (No. 59, 29.06.2017), in which the object of accounting in agriculture was clarified, the requirements for the valuation and recognition of biological assets in accordance with IAS 41 «Agriculture», read an article by Sergiy Rogozniy, Deputy General Director on Audit issues of HLB Ukraine, and Olga Karpacheva, financial analyst, certified accountant – «Biological assets: Accounting without errors». This article describes in detail how to take biological assets into account, in particular, what their classification and revaluation features depend on.

The article is available in Russian and Ukrainian.

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Accounting for biological assets in accordance with IFRS: Recognition and Measurement

Agricultural activity is one of the varieties of entrepreneurship, and at the same time a specific activity, especially when it comes to biological assets. This area of activity is regulated by IAS 41 «Agriculture». For rules on accounting for biological assets, see the article by Sergiy Rogozniy, Deputy General Director on Audit issues of HLB Ukraine, and Olga Karpacheva, financial analyst, certified accountant – «Accounting for biological assets in accordance with IFRS: Recognition and Valuation».

The article was published in the newspaper «All About Accounting» (No. 59, 29.06.2017).

The article is available in Russian and Ukrainian.

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