Legal groundwork relating to the preparation of transparency reports by extractive industry entities

Abstract

The article considers, analyzes and evaluates the current state of extractive industry in Ukraine and foreign practices related to tax payments collected by the state.In addition, the paper provides an assessment of the background and legal groundwork relating to the specific features of Ukraine’s extractive industries. The methodological framework of the research is based on historical and integrated approaches to enhancing transparency of tax and other payments collected by the state from extractive companies in accordance with the EU Accounting Directive 2013/ 34.The article analyzes the number of extractive industry entities in Ukraine over the last three years (from 2015 to 2017), covering various organizational and legal statuses as specified in the EU Accounting Directive 2013/ 34. Based on the above information, it is found that only one fifth of Ukraine’s entities compiled the IETI (Extractive Industries Transparency Initiative) reports for the period 2014 to 2015.It is proposed to determine entity status by taking into consideration at least two financial indicators expressed in monetary terms – Euro (total balance, net turnover, average number of personnel).