ACCOUNTING POLICY IN THE CONTEXT OF INTEGRATED REPORTING

Abstract

The article is devoted to the study of the importance of professional judgment in determining the accounting policy at enterprises, its approval in the order of accounting policy, as well as its further reflection in financial statements. It is investigated how the economic and legal environment of business functioning affects the development of professional judgment of accountants. The definitions of accounting policy provided by Ukrainian legislation and IFRS are compared. The dependence of the usefulness of information presented in financial statements for users on the degree of qualification of the accountant, who applies professional judgment, has been determined. Additionally, a research was provided on the importance of professional judgment in the preparation of financial statements due to opinions of Ukrainian scientists. It is proved that choosing from the alternatives available in the legislation, the accountant must be guided by the interests of the enterprise, especially in the choice of a particular method of accounting in order to form and provide reliable information about the enterprise. The sequence of accountant’s actions in the application of professional judgment is presented in the form of a diagram, and include knowledges in Ukrainian law, IFRS and business features. The link is established between the implementation of qualified professional judgment and the development of integrated reports. The process of preparing integrated reports is defined as the coordination of financial, social, environmental and other areas of business activity through the formalization of relevant judgments. Moreover, in the current conditions of development of integrated reporting, which should cover all the main areas of activity of companies, the importance of qualified professional judgment reaches a higher level. It is established at what level of development the domestic market of financial information is. It is investigated that the experience of countries with developed economies shows that skillfully formed accounting policy is an important component of the overall mechanism of management of economic activity of enterprises.