Transition to Accounting in Accordance with IFRS

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Organizations in more than 100 countries have already transferred to International Financial Reporting Standards (further — IFRS). In addition to the mandatory list of organizations (see here) that must transfer to IFRS accounting in Ukraine, companies can also make their own decisions on the transition to reporting in accordance with International Standards.

BDO in Ukraine is convinced that the transition to IFRS offers significant rewards to an entity and improves its relations with stakeholders. Transparency about the information is the guidelines in IFRS accounting system.


If you have decided to switch to IFRS, but are finding out how to that properly, using an appropriate algorithm, things are best left to the professionals, who have sufficient qualifications in this area or at least order consultation on troubling questions.
 

BDO in Ukraine will provide you with professional support when transferring to IFRS, including:

  • development of accounting policies that meet IFRS requirements

  • identification of differences between existing practice and IFRS practice

  • determination of a tax effect of the transition to IFRS with regard to differences that were identified

  • reporting transformation in accordance with IFRS 1 First-time Adoption of International Financial Reporting Standards

  • preparation of a list of adjustments made when preparing reporting under IFRS 1

 

BDO in Ukraine helps companies to successfully carry out the transition to IFRS. Our specialists will help your company in the following issues:

  • efficient methodology for the transition to IFRS
  • technical expertise of the accounting
  • taxation

BDO's pricing policy relating to international services provision is flexible and enables to apply an individual approach to customer service, ensuring the economic benefits of working with us.

 

 

See more detailed information about IFRS services of BDO in Ukraine here.

To find out more information on how BDO can help you during the transition to IFRS, please contact our experts.

 

 

Key Contact

Roman Gruba

Roman Gruba

Head of Accounting Advisory and TS
View bio

Related Publications

  • What is the transition to IFRS Accounting Standards?  

The transition to IFRS Accounting Standards is the process of implementing International Financial Reporting Standards for the preparation and presentation of financial statements in accordance with international requirements, instead of national standards. 

  • Who must or may transition to IFRS Accounting Standards?

The transition is mandatory for certain types of organisations under Ukrainian legislation, but it may also be undertaken voluntarily by companies seeking to enhance transparency, investor confidence and access to capital. 

  • What stages does the transition to IFRS Accounting Standards involve?

 • Development of accounting policies in line with IFRS Accounting Standards.

 • Identification of differences between current practices and IFRS Accounting Standards.

 • Determination of the tax effect of changes.

 • Transformation of reporting in accordance with IFRS 1.

 • Preparation of a list of adjustments under IFRS 1.

 • System configuration and staff training. 

  • What are the benefits of transitioning to IFRS Accounting Standards?

 • Increased transparency of financial statements and stakeholder confidence.

 • Opportunities to attract foreign investment.

 • Harmonisation of accounting practices with international requirements. 

  • How long does the transition take?

This depends on the size and complexity of the business and the readiness of accounting systems. Typically, projects last from several months to a year, including analysis, transformation and system adjustments (based on common practices for the projects under IFRS Accounting Standards).

  • Are changes in accounting systems required?

Yes. The information systems (such as SAP and other accounting systems) often need to be adapted to collect and process data under IFRS Accounting Standards, and user training must be provided. 

  • What is the impact of the transition on taxes?

Changes in accounting policies affect tax obligations. It is necessary to assess tax consequences and make adjustments where required. 

  • What is IFRS 1 and why is it important?

IFRS 1 is the standard governing first-time adoption of IFRS. It establishes the rules and requirements for preparing the first financial statements under IFRS Accounting Standards. 

  • Is staff training required?

Yes. Upskilling accountants and finance professionals is a key element of a successful transition, including mastering the specifics of IFRS Accounting Standards and new accounting systems. 

  • Which industries benefit most from the transition?

Companies with international investors or plans to enter international markets, financial institutions, industrial enterprises and large corporate groups gain the greatest advantages from standardised reporting (based on general practices of IFRS Accounting Standards implementation).

IFRS Accounting Standards – the International Financial Reporting Standards that establish uniform principles of preparing financial statements for global use.

IFRS 1 First-time Adoption of International Financial Reporting Standards – the standard regulating first-time adoption of IFRS Accounting Standards, including exemptions, reliefs and mandatory adjustments.

Transition to IFRS Accounting Standards – the process of replacing national accounting standards with IFRS Accounting Standards to prepare financial statements under international regulations.

Transformation of financial statements – a method of preparing statements under IFRS Accounting Standards by adjusting the data prepared under national standards, without a complete overhaul of the accounting system.

Parallel accounting – simultaneous accounting under national standards and IFRS Accounting Standards, usually in different modules or ledgers.

Accounting policy under IFRS Accounting Standards – the set of principles, methods and approaches applied by a company for recognition, measurement and disclosure of financial information in accordance with IFRS Accounting Standards.

Date of transition to IFRS Accounting Standards – the beginning of the first reporting period for which the company presents full financial statements under IFRS Accounting Standards.

Opening balance under IFRS Accounting Standards – the balance prepared at the date of transition, serving as the starting point for subsequent reporting under IFRS Accounting Standards.

Adjustments under IFRS Accounting Standards – changes to financial statement figures necessary to bring them into compliance with IFRS Accounting Standards.

Fair Value – the price at which an asset could be sold or a liability transferred between knowledgeable, independent parties.

Impairment – the process of assessing and recognising a loss in value of an asset when its carrying amount exceeds its recoverable amount.

Deferred taxes – tax assets or liabilities arising from temporary differences between accounting and tax bases.

Consolidated financial statements – financial statements of a group of companies presented as a single economic entity.

Disclosures – mandatory explanations and notes to financial statements that ensure transparency and completeness of information.

Professional judgement – a reasoned decision by a specialist on the application of IFRS Accounting Standards in situations not directly addressed by the standards.