Federal Accountability Research Articles

Subnational Tax Autonomy, Vertical Allocation, and Capital Expenditure Responsibilities: A Study of an Emerging Market

It has become imperative that subnational governments in the Nigerian federal system faithfully represent their tax autonomy and statutory receipts through their developmental efforts. The influence of states’ independent revenue initiatives and vertical allocations on capital spending is investigated in this study. The analysis spans from 2000 to 2019nd counted on secondary data from the Central Bank of Nigeria’s Statistical Bulletin. The goal of this work is to explore how much tax income generated by states and allocated from the federation account influences infrastructure development in Nigeria’s 36 states, as well as the Federal Capital Territory (FCT) of Abuja. The point is that economic development can only be achieved if the fiscal decentralization in the country characterized by revenue and expenditure responsibilities is well maximized. Thus, the study uses multiple regression techniques to arrive at the empirical results, which indicate that the states’ tax efforts do not express tangible improvement in infrastructural development. On the other hand, the result also highlights that the statutory apportionment to the states significantly affects states’ capital projects. Summarily, the study recommends conducive business vicinity and commitment of the government to provide public goods and services required by the citizens.

Federal Accounting Standard 14/2022 Intangible Assets:Basic Provisions

The article is devoted to the new Federal Accounting Standard 14/2022 “Intangible Assets”, the use of which will be mandatory for private sector organizations, including medical organizations that own intangible assets, starting with the financial statements for 2024. The innovations that will occur in the accounting of intangible assets according to the adopted standard are considered — this concerns, first of all, the modification of the criteria for accepting this type of assets for accounting and the peculiarities of determining the amount of depreciation deductions, the emergence of a new concept of “liquidation value”, changing the content of depreciation methods. The features of accounting for intangible assets in accordance with Federal Accounting Standard 14/2022 were considered, starting from its recognition, subsequent valuation, depreciation and ending with its write-off from the accounting of the organization.

Provision for inventory impairment in accordance with Federal Accounting Standard (FSBU) 5/2019: Challenges and solutions

Subject. This article discusses the issues related to the formation, increase, restoration of the provision for inventory impairment in the context of Federal Accounting Standard (FSBU) 5/2019 – Inventories application. Objectives. The article aims to identify the most justified options for accounting of the business facts to form, increase and restore the provision amount for the inventory impairment. Methods. For the study, I used the methods of analysis and synthesis, comparison, generalization, and modeling. Results. The article focuses on problematic issues related to the determination of the provision amount and the reflection of entries in the accounts, and reveals the position of the authors on their solution. Conclusions and Relevance. In some cases, Federal Accounting Standard (FSBU) 5/2019 – Inventories does not contain unambiguous instructions regarding the formation of information on provision for the inventory impairment, and therefore there is uncertainty that makes it difficult to account for certain facts of economic life. The recommendations proposed in the article can be useful for practical application by economic entities in determining their position in relation to records in the formation, increase, restoration of the provision amount in connection with the use of Federal Accounting Standard (FSBU) 5/2019 – Inventories.

New program for the FAS development and the main changes in the rules of Russian accounting for non-state sector organizations

The Ministry of Finance of the Russian Federation approved a new program for the development of Federal Accounting Standards (FAS) for organizations in the non-state sector (including healthcare organizations in this sector) for 2022–2026. This program involves making adjustments to certain already existing standards, as well as the creation and approval of a number of FAS that make significant changes to the Russian accounting of the above organizations. The drafts of some of these FAS have already been prepared, and one of the federal standards planned by this program has already been practically adopted. The main changes in the rules of Russian accounting that are awaiting organizations in the non-state sector (including healthcare organizations in this sector) in connection with the release of the above program and the FAS stipulated by it, are analyzed in this article. The following methods were used in the course of the research: analysis and synthesis, comparison, grouping method, analogy method, systematic approach, logical approach. As a result of the research, the main stages of updating the FAS system and the relevant domestic accounting rules of the above organizations were identified, as well as the most important changes in these rules were identified and systematized. The results of the analysis of future changes in Russian accounting rules presented in this article will help modern organizations in the non-state sector (including healthcare organizations in this sector) prepare in advance for such changes and make it much easier to go through the process of transition to new federal standards.

Directions for further development of accounting for intangible assets

Intangible assets occupy an increasingly significant place in the activities of organizations of various forms of ownership and various industries (including healthcare). This sets the task of developing accounting regulations that would ensure the formation of complete and reliable information about intangible assets. Currently, the accounting of intangible assets of commercial organizations and non-profit organizations that do not belong to the public sector is regulated by PBU 14/2007 “Accounting for intangible assets”. At the same time, the adopted Program for the further reform of Russian accounting provides for the adoption of a new FSB “Intangible Assets” for commercial organizations and non-profit organizations that do not belong to the public sector. In order to implement this Program, the Accounting Development Fund “National Non-State Accounting Regulator “Accounting Methodological Center” (Foundation “NRBU “BMC”) developed and published for discussion the FSBU Draft “Intangible Assets”. The innovations of this Project are analyzed in this article. The Russian Accounting Standards Reform Program aims at further convergence of Russian Federal Accounting Standards (FSBU) with IFRS regulations. In this regard, it is of interest to study the degree of convergence of the regulations of the FSBU Project “Intangible Assets” with the regulations of IAS 38 “Intangible Assets”. The research methods were comparison, analysis, synthesis, grouping method, systemic and logical approaches. As a result of the study, the article identified and substantiated aspects of greater proximity of the regulations of the FSBU Project “Intangible Assets” to the regulations of IFRS (IAS) 38 in comparison with the regulations of PBU 14/2007, as well as such issues of accounting for intangible assets, for which the FSBU Project “Intangible Assets” differs from IAS 38.

Accounting policy of economic entities in the conditions of application of Federal Accounting Standard (FSBU) 6/2020 – Fixed Assets

Subject. This article discusses the development of the accounting policy provisions in accordance with the requirements of the Federal Accounting Standard (FSBU) 6/2020 – Fixed Assets, for the identification of fixed assets, their valuation, depreciation, write-off of objects from accounting, disclosure of information about fixed assets in accounting (financial) statements. Objectives. The article aims to analyze the provisions of the Federal Accounting Standard (FSBU) 6/2020 – Fixed Assets in the context of its sections for the need for local regulation of certain issues of accounting for fixed assets, and develop options for internal regulations to include them in the accounting policy of an economic entity for the purpose of accounting for fixed assets. Methods. For the study, we used the methods of analysis and synthesis, comparison, generalization, and modeling. Results. The article identifies issues in respect of which local regulation is necessary on the basis of the requirements of the Federal Accounting Standard (FSBU) 6/2020 – Fixed Assets, and offers options for the provisions of the accounting policy in order to form information on fixed assets of economic entities. Conclusions and Relevance. The article concludes that it is necessary to adapt the accounting policy of economic entities to the requirements of the Federal Accounting Standard (FSBU) 6/2020 – Fixed Assets in connection with the need for its mandatory application, starting with the accounting (financial) statements for 2022. The proposed recommendations may be useful for further research on the formation of information on fixed assets of economic entities and for practical application by economic entities in drawing up the provisions of accounting policy for the purpose of fixed assets accounting.

Review: Green Persuasion: Advertising, Voluntarism, and America’s Public Lands, by Jeffrey K. Stine

Review: <i>Green Persuasion: Advertising, Voluntarism, and America’s Public Lands</i>, by Jeffrey K. Stine

Financial Instruments accounting: innovations, problems, solutions

Recently, the importance of such objects as financial instruments has increased in the activities of Russian organizations of various forms of ownership and various industries (including healthcare). This necessitates a realistic accounting of these objects. In turn, for the implementation of realistic accounting, carefully developed rules are required, which are laid down in regulatory documents on accounting. In the system of international financial reporting standards (IFRS) there are a number of standards containing regulations for the accounting of financial instruments. Despite the fact that the Russian system of accounting standards (RAS) has long been in the process of being reformed based on international standards, the area of accounting for financial instruments is still not sufficiently regulated. At the same time, the program for the development of Russian federal accounting standards (FSBU) involves a number of changes in existing regulatory accounting documents, as well as the creation of new accounting standards. In this regard, it is of interest to analyze the FSBU Project “Financial Instruments” presented for discussion, developed by the Accounting Development Fund “National Non-State Accounting Regulator “Accounting Methodological Center” (Foundation “NRBU “BMC”). The study of the regulations of this FSBU “Financial Instruments” Project is carried out in this article. The research methods were comparison, analysis, synthesis, grouping method, systemic and logical approaches. As a result of the study, the article substantiates the positive aspects of the FSBU “Financial Instruments” Project, identifies some of its shortcomings, substantiates the value of this regulatory document for realizing the goal of reliable accounting of financial instruments.

Development of economic views in the field of remuneration and the modern approaches to its accounting

Subject. This article analyzes the development of economic views on the theory of remuneration, and it also considers the methodological aspects of accounting processes for the formation and disclosure of information on remuneration to employees in reporting. Objectives. The article aims to consider changes in the views of society on the wages of employees, and justify the need to develop and adopt the Federal Accounting Standard FSBU – Employee Benefits in accordance with international standards. Methods. For the study, we used analysis and synthesis, comparison, logical generalization, and the systems approach. Results. The article systematizes the main theoretical approaches to the study of issues in the field of remuneration, identifying the main differences and common features of the theories of remuneration. The article also presents a comparative description of Russian and international standards on the accounting of remuneration to employees and justifies the need to develop and adopt the FSBU – Employee Benefits in accordance with international standards. Conclusions and Relevance. The theories of wages outlined in the article characterize the order of development of economic theory in the field of remuneration, as well as changes in the judgments of society that influenced the nature of the development of relations between the employee and the employer. The results of the study can be used for the theoretical study of the issue, as well as in the practical activities of an economic entity in the context of sustainable business development.

Концептуальные основы учетно-контрольного инструментария развития малого и среднего предпринимательства

Based on a study of the theory and practice of organizing accounting and compiling financial statements in small and medium-sized businesses, as well as a critical analysis of conflicting points of view on simplified methods of accounting and preparing financial statements, the author substantiates the main directions for improving the accounting and control tools for the development of small businesses. and medium-sized businesses through the introduction of appropriate elements of the accounting system and formulated its conceptual foundations. The structure of the Federal Accounting Standard for Small and Medium-Sized Businesses (FAS) is proposed, the composition of financial statements for medium, small and micro-enterprises is substantiated, and recommendations are given on the content of explanations for the main forms of accounting financial statements.

Evolution of accounting rules for Small and Medium-Sized Business Entities

The object of this study is problematic issues regarding updating accounting rules in small and medium-sized businesses (IFRS for SMEs) in digitalization. The authors give a critical analysis of significant simplifications in the accounting system and accounting (financial) reporting in the Federal Accounting Standards (FSBU) and other legal acts regulating the accounting and reporting of small and medium-sized businesses. Based on the results of the work, the authors concluded on the advisability of applying certain simplified requirements for the formation and disclosure of financial information by small businesses, considering a thorough check of each of them for negative consequences in the usefulness’s context of this information; the lack of demand for “outdated” recommendations was revealed and the rationality of their cancellation was substantiated. The research showed that in the use’s context of digital technologies, additional IT opportunities are being formed to ensure the information transparency of SME activities and improve the quality of reporting information in sustainable development. The opinion about necessity to develop a separate Federal Accounting Standard for small and medium-sized businesses is substantiated. In the study’s course, the authors applied the methods of analysis, synthesis, comparison, systematic and logical approaches, accepted accounting principles that ensure the usefulness of information for interested users. The obtained results are aimed at the development of accounting practices in the new economic conditions.

Strategies to Enhance Local Government Finance in Nigeria

This study adopted historical approach to political research and used secondary sources of information. This paper focuses on assessing financial challenges facing local governments in Nigeria. The study observed that insufficient allocation from the federation account, lack of effective revenue generation drive, mismanagement of funds, intrusion of the state government into local governments use of funds, amongst others are the major challenges confronting local governments. Nevertheless, if right strategies such as effective planning, accountability, transparency, curbing of financial mismanagement, sound business undertaking, increased fund allocation from federation account are adopted, local Government may be in better position to accelerate the pace of infrastructural development in Nigeria.

Capital Investments Accounting in the Context of Ongoing Legislative Reforms

The accounting regulatory system in the Russian Federation is being currently updated, which results in introduction of a number of new federal accounting standards. Implementing new regulations is always fraught with difficulties, which in this case include emerging of different types of assessment of accounting objects, and changing order of calculation of accounting indicators. The purpose of this article is to review the provisions of FSBU 26/2020 «Capital Investments» which is one of the five federal accounting standards effective as of 2022. The study is concluded with an analysis of regulatory controls before the standard came into force and in accordance with FSBU 26/2020, and the draft amendments to it. It has been proposed to differentiate capital investments by time and method of their implementation, as well as by their direction. One of the problems of applying the standard in practice is that it is required of an accountant to develop a professional judgment in relation to such issues as: defining the type of restoration recognized as an object of capital investments, assessment of fair and discounted value of capital investments, calculation of their depreciation and estimated liability arising from their implementation.

Tax Accounting of an Organizations Fixed Assets

The article discusses the main elements of the depreciation policy of an organization, since the new Federal Accounting Standard FSB 6/2020 “Fixed Assets” became mandatory for application starting from January 1, 2022. Fixed assets are part of the non-current assets of an organization, they are used for a long period of time as work equipment of the enterprise and are an integral part of the production and economic activities of the organization, taking into account the analysis of the effectiveness of their use. Therefore, this topic is very relevant and topical in the light of the current import restrictions in the country. The comparative characteristics of depreciation accrual according to the rules of accounting and tax accounting are considered. The methods of depreciation calculation are described in detail in specific cases, taking into account all the innovations in accounting and tax accounting in 2022. A definition of the concept of non-current assets, namely fixed assets and depreciation charges is given. The methods used to calculate depreciation charges are described, the useful life of non-current assets: how to establish it and what it can depend on is also considered. The interpretation of the concepts of evaluation of fixed assets, namely initial, restorative, fair and liquidation evaluation, is given. Despite the fact that the topic has been studied, some issues in the treatment of fixed assets in the current standard remain debatable.

Accountability and assessment in U.S. education: let’s not allow another crisis go to waste!

ABSTRACT State education systems in the U.S. experienced major disruptions due to the COVID-19 pandemic. Results from assessments administered during, and at the conclusion of, the 2020-21 school year indicate substantial ‘unfinished learning’, with the losses generally greater among disadvantaged and marginalized students. States’ assessment systems are strongly tilted toward meeting Federal accountability requirements, especially state-wide comparability of end-of year test results, which severely limits innovation. The two-year pause in accountability due to the pandemic presents an opportunity to radically rethink school accountability, allowing states greater flexibility in developing creative interventions and more balanced assessment systems to better support student learning. A new trade-off between comparability and local flexibility is long overdue, especially given the poor record of the current system in promoting learning and closing achievement gaps. We offer some examples of how the trade-off can be accomplished and the potential benefits that would ensue.

Problems of risk disclosure in the financial statements of organizations and ways to solve them

The importance of disclosing information about risks in the financial statements of organizations (including healthcare organizations) cannot be overestimated. At the same time, at present there is no separate Federal Accounting Standard (FAS) or Accounting Regulation (AR) containing the rules for disclosing this information. The main regulations in this area are currently presented in a document with the status “Information of the Ministry of Finance of the Russian Federation” under the number PS-9/2012 (hereinafter IM No. PS-9/2012). An analysis of the requirements of this document, as well as the practice of disclosing information about risks in financial statements in accordance with this document, allows us to conclude that at present there are a number of theoretical, methodological and practical problems in the field of disclosure of the above information. These problems are analyzed in this article. The following methods were used in the research: analysis and synthesis, grouping method, comparison, analogy method, systematic approach, logical approach. As a result of the research, the article identifies the main groups of problems in the above area and offers suggestions for their solution. The results presented in the article may be useful to a wide range of readers interested in modern problems of Russian accounting, in particular, disclosure of information about risks in the financial statements of organizations (including healthcare organizations).

Accounting and the U.S. Constitution: The Evolution of Federal Financial Accounting and Reporting Practices

ABSTRACT This study surveys and provides insights into the arc of federal government financial reporting developments, including the reporting mandate contained in the Constitution of the United States. Federal financial reporting has recently surpassed several significant milestones. The U.S. Government Accountability Office and Office of Management and Budget celebrated the 100th anniversary of their founding in 2021. Meanwhile, the Chief Financial Officers Act of 1990 and the Federal Accounting Standards Advisory Board have reached the 30-year mark. Progress during the last 20 years has focused on extending the requirements of the Chief Financial Officers Act, improving federal financial reporting standards, and increasing transparency through easily accessible open data.

Presentation of accounting information on non-current assets using simplified methods

Subject. This article deals with the topical issues of the methodology for accounting for non-current assets using simplified methods due to changes in the accounting legislation of the Russian Federation in terms of the application of Federal Accounting Standards FSBU 6/2020 – Fixed Assets, FSBU 26/2020 – Capital Investments and FSBU 25/2018 – Lease Accounting. Objectives. The article aims to group simplified accounting methods for non-current assets and apply them when presenting accounting information about these assets. Methods. For the study, we used the methods of analysis, systematization, comparison, and grouping. Results. Based on the analysis of changes in accounting legislation on accounting for non-current assets, the article groups the statutory regulation of simplified methods. It offers accounting records for intangible assets, property, plant and equipment, capital investments and lease items, and defines the main simplified ways of accounting for non-current assets that must be approved in the accounting policy. Conclusions and Relevance. Based on the analysis of federal accounting standards, the article concludes that the development and practical application of simplified methods of accounting are relevant for reflecting the accounting events by small businesses and non-profit organizations. The results obtained can be applied both in the theory and practice of accounting in relation to the accounting of items using simplified methods.

Estimated Liabilities as an Object of Accounting in the Public and Non-Public Sectors of the Economy

The specifics of the activities of economic entities in the state and non-state sectors contributed to the isolation of accounting subsystems in these sectors, each of which was formed based on its organizational, technical and methodological foundations. Currently, the development of accounting in the Russian Federation is carried out in these sectors in accordance with IFRS in parallel, through the development of new federal accounting standards, the content of the norms of which often differ in relation to the same accounting objects. At the same time, the existing features of the organizations' activities in each sector should not cause discrepancies in approaches to the recognition and accounting of similar objects. In our opinion, developing federal standards, uniform approaches should be applied to the definition of objects, their classification, recognition, evaluation and disclosure of information about them in the reporting. One of the most difficult objects of accounting in both the public and non-governmental sectors are estimated liabilities. This article is devoted to the problematic aspects of their recognition and accounting through the creation of provisions. The result of the study is a comparative analysis of the legal regulation of the creation of provisions for estimated liabilities and the identification of problems of their formation in practice. This made it possible to classify provisions according to the criterion of the possibility of discounting them. It is offered to expand the list of grounds for creating provisions.

Racial and Socioeconomic Disparities in the Relationship Between Children’s Early Literacy Skills and Third-Grade Outcomes: Lessons From a Kindergarten Readiness Assessment

Federal accountability policy mandates that states administer standardized tests beginning in third grade. In turn, third-grade test scores are often viewed as a key indicator in policy and practice. Yet literacy struggles begin well before third grade, as do racial and socioeconomic disparities in children’s literacy skills. Kindergarten readiness assessments provide a unique opportunity to better understand the emergence of literacy disparities. We use unique kindergarten literacy data from nearly every school division in Virginia to document the relationship between children’s early literacy skills and their later reading proficiency. When comparing children with similar literacy skills at kindergarten entry, we find significant racial and socioeconomic differences in the likelihood that a child will be proficient on their third-grade reading assessment.