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There is a number of differences between the principles of accounting accepted in certain Russian and international standards.

For convenience, the existing differences can be divided into two groups:

• The first group of differences can be explained by the fact that some rules do not exist in Russia, for example, those related to business combination, depreciation of assets, financial instruments, etc.;
• The second group of differences can be explained by the fact that the Russian Accounting Standards (RAS) and the IFRS have different rules applicable to identical issues, for example, those related to finance lease, reserves, information disclosure in financial statements, etc.

Due to this, when IFRS financial statements are prepared on the basis of the RAS, it is necessary to perform restating. Restating stands for analysis of financial statements adopted by a Russian enterprise, making amendments required for preparation of a comprehensive financial report of the company, which would in general comply with the international financial reporting standards (IFRS, US GAAP).

The full packet of financial statements includes:

• Statement of financial condition (the Balance sheet);
• Statement of total revenue (complex profit and loss);
• Cashflow statement;
• Statement of changes of shareholder equity;
• Key accounting policies;
• Notes to the financial statements;

In the projects involving restatement of financial statements in compliance with the IFRS requirements, IDelync are guided by the principle of individuality of a Client, taking into account the specifics of Client’s activities, prospects of further development and dynamics of capitalisation of a Client’s company.

As a result, the financial statements prepared in accordance with the requirements of international standards may not only be used as financial statements for attracting additional funding or procedures of the company’s capitalization, but also as an instrument for:

• determining strategic key indicators;
• budgeting (planning) procedures in companies;
• financial analysis of attainability of the fixed indicators and assessment of dynamics of a company’s development;
• the mechanism of control of a company’s value.

Apart from financial statements, IDelync provides services of consolidation of financial statements for a group of companies.

The main purpose of preparing consolidated statements is presentation of activities of a holding or a group of interrelated organizations (mother, daughter and independent) as an activity of a single economic unit. A mother company submits consolidated statements in order to objectively and faithfully demonstrate to the owners what their investments are like, that is control and ownership of net assets of enterprises (IFRS 27).

The services of preparation and consolidation of statements may be completed on Client’s request with the services of development of regulations as well as with audit of international and Russian statements.

The main objectives of the treasury functions automation are:

• To decrease the labour-output ratio and reduction of the accounting information processing time;
• To increase reliability of information;
• To enable integration with different information data sources;
• To ensure prompt preparation of management reporting;
• To ensure efficiency and immediacy of control.

The main functional capabilities of the management information system of the "ID.Treasury":

1. Preparation and control of implementation of the financial plan;
2. Functionality to create the payment schedule;
3. Drawing up, analysis and approval of the register of payments;
4. Comparative analysis of the financial plan and the register of payments.

 The solution includes the following works:

• Long-term planning of payments – one year, month, week finance plans

Considering the fact that the process of the finance plans preparation involves many services of the company(Centre of Financial Responsibility), the solution allows to prepare finance plan templates in Excel and download them to the treasury module upon the filling of the budget by the supervisors.

• Short-term payments planning – payment schedule, requests for funds application

The payment schedule is created in the system by the Treasurer and is an optimal tool for distribution and payments control on the daily basis taking into account the payment schedule and availability of funds. The Treasurer takes the decision regarding the payments for the next several days on the basis of the Payment schedule, indicating which requests for payment will be finalized on which day and from which settlement account. At the same time, this document is the ground for drawing up the Payment Register document. The document has the functional for fast and convenient correction of payments. Moreover, it features the tools necessary for online processing of the document: group processing (for fast changes in properties of several payments at the same time), operating corrections (changes in the reflection of company’s financial situation in the overall balance) and snapshots (records of the financial condition of the company at a particular moment with further reconstruction of the whole picture for analysis of correctness of work of the financial service in general).

• Storage of the versions of the payment schedule, facilities for their comparison for choosing the best option

The snapshots of the financial condition are intended for saving the interim results of settlement accounts taking into account the payments. The Treasurer, recording the versions, demonstrates the results achieved at the moment of the snapshot. Later, these can be used for analysis of the payments planning process. The reports also allow to choose the snapshots (below referred to as versions) and show the condition of the payments at the moment of the version creation.

• Approval of payments

The approval process takes place upon agreement of all payments. Then the approved payment register is created. The main schedule and registers may have specifying schedules and registers.

The Payment Register is the document to be approved and acts as the final point of payment planning. Upon approval of the document, it is impossible amend the requests for expenditure included into this payment register and payment schedule, on the basis of which the payment register was created.

The payment register contains payments which will be performed on the date of the payment.

The essential condition for the companies trying to attract foreign investment is preparation of IFRS reports. It is extremely important not just to obtain the reports, but rather make these reports an effective tool for analysis and support in taking management decisions.

Building the IFRS accounting model in the Company contains several stages:

• Developing the accounting policy of the Company. The accounting policy regulates all aspects of the technology of preparation of financial statements: the main components of the reports, choice of the reporting currency, description of the transformation technology from fully functional currencies (if they are used) into the reporting currency, requirements to preparation of forms of group reporting for the Group members, etc.
• Developing the Regulations on gathering and processing of information. This document assigns distribution of duties and the corporate regulations on gathering and processing of information during preparation and drawing up of statements.
• Choosing, setting up and implementing the tools for preparation of financial statements. At this stage, the Company has to establish which tools it will be using for preparation of the financial statements on time and with the required level of detail.

IDelync experts, using their own experience in preparation of financial statements as the basis, as well as their excellent knowledge of our clients’ requirements to these statements, have developed an automated solution for maintaining IFRS accounting and preparation of statements.

In contrast with the most widely spread model of maintaining the accounting in Excel, this solution gives the opportunity to immediately receive “decoded” information on the items of the statements and “submerge” to each transaction or posting (which is quite often required for analysis of the situation).

Thus, significant saving is achieved by means of completeness and substantiveness, timeliness and consistency of the automatically generated IFRS reports. This means that the specialist of financial service will be able to make analysis more effectively and take timely decisions.

On the whole the solution allows to:

• Automate processing of a greater amount of operations of the same type at the moment of transformation of RAS data into IFRS accounting (entry mapping), which allows to minimize the labour intensiveness of the IFRS accounting maintenance;
• Itemize the reporting data before the primary discount transaction, which makes the process of checking the  IFRS accounting data and collation of the RAS and IFRS data much easier;
• Maximally decrease the influence of the human factor onto the final result of transformation of accounting data due to automation and control of preparation of statements;
• Obtain the required analytical breakdown of the finalized statements.

The process of preparation of the consolidated financial statements in accordance with the requirements of the international standards by means of the “IFRS management accounting” solution includes the following stages:

• Gathering the data of prime records in accordance with the requirements of the Russian legislation and its transformation into IFRS prime records;
• Necessary alterations and missing primary information are added into the IFRS prime records obtained in the manner described above;
• The accounting data is consolidated and in the end, the consolidated statements are prepared.

The advantages of this Solution:

• The solution is implemented on the basis of 1C:Enterprise, which enables use of all the advantages of this platform: accessibility, scalability, open code.
• Functionality to use different information systems (1C, “Info-Buhgalter”, “Turbo-Buhgalter”, “Parus”) as information systems which are primary information sources.
• The functional of the system allows to set up accounting in compliance with the IFRS principles regarding “Property, Plant and Equipment”, intangible assets, inventories, which significantly simplifies the procedure of making adjustments (depreciation calculation, asset revaluation, accrual of reserves) with respect to these accounting entities.
• The flexible system of set up of templates of financial statements and data unload into Excel accounting. There is a dedicated directory of elements of financial statements, in which the statements structure and the information source for each item of the statement are specified. On the basis of the specified structure, an Excel report template is generated automatically and it is further automatically filled in with the Solution data.
• Roll-out of the values of the reports into consolidation tables is provided for by the mechanism of the Solution, which allows to obtain different management reports on the basis of the consolidation tables.
• Functionality to single out the intracompany balance and prepare consolidated group statements.

The final solution and the terms of IFRS accounting automation are exclusively individual for each company. IDelync pays special attention to organization of works for preparation of the Company for the implementation, staff recruitment and training. In the course of implementation, operating and management processes in the company, document flow and financial accounting are analyzed, as well as the existing and operating information systems and technologies. The management system, put into the basis of the organization of the project works, intended for development process and implementation of complex systems and Rational Unified Process software, allows to integrate different software into a unified integrated MIS and obtain IFRS statements of adequate quality.

Significant practical experience of IDelync experts in synergy with the theoretical knowledge, allow to find adequate alternative solutions for creating an IFRS accounting system for any one occasion.