Methodological aspects of accounting of warranty provision in accordance with international financial reporting standards
Date
2020-02-24
Journal Title
Journal ISSN
Volume Title
Publisher
Видавництво Львівської політехніки
Lviv Politechnic Publishing House
Lviv Politechnic Publishing House
Abstract
In order to ensure that warranty repair
and maintenance costs are included evenly in accordance
with National Accounting Standards and International
Financial Reporting Standards, entities are entitled to
create provisions under warranty. Creation of such
provisions allows to adjust the income and expenses for
warranty repair and maintenance and to reasonably
distribute expenses between the reporting periods, which
helps to optimize the tax burden. The purpose of the
article is to review the methodological aspects of
accounting of warranty provisions in accordance with
International Financial Reporting Standards. The
achievement of the stated goal necessitated the
following tasks: to disclose the nature and conditions of
recognition of provisions for warranty in accordance
with international accounting standards; to present the
methodology for accounting in the accounting and tax
accounting and financial statements of the provision for
warranty in accordance with IFRS; to propose methods
of calculating the warranty provisions to determine their
main advantages and disadvantages. The main general
scientific methods of research were the analysis
(for conducting the research of the main essential
characteristics of the research object and peculiarities of
its functioning in the context of the topic of scientific
work). Analogy method, dialectical method and systematic
approach were used to reflect the methodological
approach to accounting and to show in the financial
statements the provisions for warranty. Comparison
method was used for evaluating the techniques for
calculating warranty provision for entities that prepare
IFRS financial statements.
Description
Keywords
provisions, warranty, IFRS, warranty period, accounting policy
Citation
Methodological aspects of accounting of warranty provision in accordance with international financial reporting standards / T. Davydiuk, S. Syrtseva, V. Endres, V. Nadraga // Economics, Entrepreneurship, Management. — Lviv : Lviv Politechnic Publishing House, 2020. — Vol 7. — No 2. — P. 22–32.