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Explanatory note to the balance: an example. Accounting statements of the organization. An illustrative example of the design of explanations in addition to the balance sheet

Legislatively, an explanatory note is not a mandatory report, although it is included in the annual financial statements. However, there are situations when such a document is simply necessary. Let's consider in what cases this document is needed and in what form it should be drawn up.

Explanatory note: essence and content

In fact, the tax authorities do not need an explanatory note. It is compiled so that the company can confirm its positive reputation:

  • the more fully all the figures from the report are disclosed, the more transparent the company's activities will look;
  • an explanatory note will make the company more authoritative in the eyes of potential partners, and will also attract third-party investors;
  • an explanatory note is an opportunity to avoid various questions from regulatory authorities.

Experts recommend compiling an explanatory note with the same frequency as the financial statements. Why Explain Accounting Documents? For example, to determine the final figure of "accounts receivable", it is necessary to take into account the balances of all calculations, and also take into account the amount of the reserve, which is not indicated separately in the balance sheet, however, may be of interest to certain investors.

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As a rule, no explanations are given only to the balance sheet, since the balance sheet is not drawn up alone, but together with additional reports. In this regard, an explanation should be made for all submitted reports at once. The explanatory note should include a breakdown of all balance lines. For example, from a company's income statement, we get an idea of ​​the company's net income, however, it is part of a balance sheet line such as "Retained earnings". Accordingly, this indicator necessarily needs to be deciphered.

Most often, decryption of lines is made in the form of tables, where the number and name of the line are indicated in one column, and an explanation is placed in the second. In addition to decoding, the following points should be indicated in the explanatory note:

  • general information about the company: details, founders, date of creation, organizational form, other data about the company;
  • the main provisions of the accounting policy;
  • balance structure in percentage terms;
  • asset valuation and analytical financial indicators: liquidity, reserves, profitability;
  • the composition of fixed assets, the company's reserves in value terms;
  • salary fund;
  • issued and received collateral;
  • other information about the work of the company.

The explanatory note is signed by the head of the enterprise and certified by the seal of the company. But, in general, all of these items are not mandatory.

A sample of filling out an explanatory note to the annual financial statements

There is no general, unified form of an explanatory note to the annual financial statements, therefore, this document is drawn up arbitrarily. The points of the explanatory note are determined by the management, depending on how complete the decoding of the indicators should be:

All explanatory information is indicated in any form and may contain, in addition to tables, graphs and diagrams. You can detail the information in a variety of ways, it all depends on how detailed the management wants to disclose information about the company's work. The most important thing is that the information is as reliable and useful as possible.

One of the conditional forms of financial statements is an explanatory note. As the name implies, it contains a kind of decoding of the statements, that is, in fact, it describes in words the financial position of the company at the end of the year and the changes that have occurred in it during the reporting period.

Explanatory note to the balance sheet - mandatory or not?

First of all, we note that the explanatory note and the explanations to the balance sheet should not be confused. The latter, in accordance with clauses 5 and 28 of PBU 4/99 “Accounting statements of an organization”, are separate reporting forms, such as a cash flow statement, a statement of changes in equity and other forms in the financial statements, which are actually considered appendices to the balance sheet and statement of financial results. The explanatory note itself also refers to the explanations in the reporting set.

Is an explanatory note to the balance sheet required? Of course, the company must compile it and submit it to the IFTS as part of the financial statements. However, there is one exception here. If the characteristics of the company's activities allow it to carry the status of a representative of a small business, then such a company can draw up financial statements in a simplified form. This involves the submission of financial statements as part of only two forms: a balance sheet and a statement of financial results. A small business will also not have an explanatory note to the financial statements.

How to write an explanatory note: sample

The content of the explanatory note, in cases where it is necessary to draw up, should provide regulatory authorities with information about the company's activities in the reporting period. It indicates the main characteristics of the business as a whole, as well as factors affecting changes in certain indicators. There is no strict format for an explanatory note. That is, an accountant can compile it in text form and use various tables, summaries, graphs or charts in it, in a word, use in this report all methods of presenting information that he deems necessary. The data set for the explanatory note is also determined by the accountant himself. At the same time, he must be guided by the very purpose of this form, in other words, disclose in it the information necessary for the formation of the controllers' understanding of the company's activities.

An example of an explanatory note

Explanatory note to the balance sheet for 2016 (sample)

Alpha LLC

  1. General information
    1. Alpha Limited Liability Company
    2. Legal and actual address: Moscow, st. Profsoyuznaya d. 99.
    3. Date of registration: August 21, 2013.
    4. PSRN: 1077077077077
    5. TIN: 7727077700
    6. Gearbox: 772701001
    7. Registered in the Federal Tax Service of Russia No. 27 for Moscow, certificate of state registration 77 No. 000000077.
    8. Authorized capital: 10,000 (ten thousand) rubles, paid in full.
    9. Main activity: 70.3 - Provision of intermediary services related to real estate.
    10. The number of employees as of December 31, 2016 was 65 people.
    11. There are no branches, representative offices and separate subdivisions.
    12. The balance sheet is formed in accordance with the rules of accounting and reporting in force in the Russian Federation.
  1. Accounting policy

The accounting policy for accounting purposes for 2016 was approved by the order of the General Director dated December 25, 2015 No. 2015-12/28. The accounting policy did not change during the reporting period.

  1. According to the approved document, the organization applies the straight-line method of depreciation of fixed assets and intangible assets.
  2. The cost of inventories, finished products is carried out at the actual cost;
  3. the write-off of inventories into production is carried out at the average cost.
  4. The financial result from the sale of products, works, services, goods is determined by shipment.
  1. Key performance indicators (here you can give the main figures on the income and expenses of the company, reflected for accounting purposes)
  1. In the reporting year, the revenue of Alfa LLC amounted to:
    1. For the main activity for the provision of intermediary services related to real estate - 158,456,120 rubles
    2. For other activities - 1,000,580 rubles.
  2. Other income: 670,800 rubles.
  1. Costs associated with production and sale:
    1. Acquisition of fixed assets: 3,480,780 rubles
    2. Depreciation: 44,118 rubles,
    3. Purchase of materials: 110,880 rubles.
    4. Payroll fund: 37,520,130 rubles,
    5. Travel expenses: 458,690 rubles,
    6. Rent: 5 420 180 rubles.
  2. Other expenses: 980,456 rubles.
  1. Breakdown of balance sheet items as of December 31, 2016

(Here, individual balance sheet items are deciphered with more detailed information and explanations that may be of interest to auditors. Let's give an example of such an explanation for the line "Capital and reserves").

4.1. Capital and reserves.

In 2016, the capital ratio and reserves were increased at the expense of a part of retained earnings of previous years, remaining after the payment of dividends to the founders of Alfa LLC in 2015. Thus, the cost of capital and reserves amounted to RR 880,000 as at 31 December.

  1. Assessment of the value of net assets (data on net assets calculated on the basis of accounting indicators as of December 31 of the reporting year are provided).
  1. The composition of fixed assets (the indicator of the corresponding line of the balance sheet is deciphered).
  1. Accounts payable (including it is advisable to indicate the debt to the budget at the end of the year).
  1. Other information.

General Director of Alpha LLC Ivanova T.N.

As already mentioned, the legislation does not offer a clear list of information related to the financial activities of the company, which the accountant would be required to include in the explanatory note to the balance sheet. The main thing in its preparation is to adhere to the general principle of compliance with the data of financial statements.

Related parties in the explanatory note

However, special attention should be paid to information about related parties when drawing up an explanatory note. It is recommended to indicate it in this document as a separate section (clause 14 PBU 11/2008).

The company has the right to determine the list of related parties, the data on which it will reflect in the note. The data themselves must be disclosed in the context of information on transactions with related parties, and also, regardless of the transactions, for those organizations and individuals that are recognized as affiliates.

Related parties in explanatory note, example

  1. Information about affiliated persons as of December 31, 2016:
  2. Ivanova Tatyana Nikolaevna - the founder of a 50% share in the management company, holds the position of General Director.
  3. Petrova Ekaterina Borisovna - the founder of a 50% share in the management company, holds the position of Deputy General Director.
  1. Transactions conducted in the reporting period with related parties.

2.1. On March 20, 2016, the general meeting of the founders of Alfa LLC considered and approved the financial statements for 2015. The meeting decided to pay a profit in the amount of 7,800,000 rubles at the end of 2015 to the founders based on their share in the management company. The payment (taking into account the withholding of personal income tax) was made on 1504.2016.

2.2. In July 2016, Alfa LLC entered into an agreement with the founder Petrova E.B. an agreement on the acquisition of non-residential premises worth 1,250,000 rubles. The value of the transaction is determined by an independent appraisal of the value of the property by an independent appraiser. Settlements for the completed transaction were made in full in August 2016, at the same time the act of acceptance and transfer of the premises was signed.

The rules according to which the financial statements of the organization are drawn up are approved by order of the Ministry of Finance No. 43n dated July 6, 1999. PBU 4/99 defines the structure of the documentation. An explanatory note to the balance sheet acts as its integral elements. Let's take a closer look at this document.

General information

As mentioned above, the financial statements of the organization includes several elements. These include:

  1. Audit report. It confirms the reliability of the balance sheet. The conclusion is provided by those enterprises for which, according to the norms, a mandatory audit is provided.
  2. Final document on financial results.
  3. Balance sheet.
  4. Clarifications.
  5. Applications.

Explanatory note to the balance sheet

This document discloses the information present in the final accounting documents. An explanatory note to the balance sheet must contain information about:


Important point

The explanatory note to the balance sheet should also include a description of the facts of non-application of RAS in cases where their use does not allow a reliable description of the property status and financial results of the company, with justifications. Otherwise, the relevant circumstances will be considered as evasion of compliance with the rules and act as a violation of legal requirements. Accordingly, the control authorities can apply the sanctions prescribed by law against the perpetrators.

Additional Information

In addition to the main data, the accounting note may include information that accompanies the final documents if the company's management decides that they will be useful to users in making management decisions. Additional information includes:


The explanatory note to the balance sheet may contain other additional information. These data, if necessary, can be presented in the form of diagrams, graphs or analytical tables.

An example of an explanatory note

The document is drawn up according to the approved rules. An example explanatory note consists of the following sections:

  1. Basic information about the enterprise.
  2. Revenues from sales.
  3. Selling costs.
  4. The financial result that is obtained from the main activity.
  5. Other income.
  6. Other expenses.
  7. Income tax calculation.
  8. Financial result of economic activity.
  9. Information about the accounting policy.

Basic information about the enterprise

An explanatory note to the balance sheet begins with it. The form of the document is not unified. The company has the right to independently develop a form. The section on basic information about the enterprise should contain:


The basic information also indicates the number of employees, information on the size of the authorized capital, and the main types of activities.

Sales income/expenses

The explanatory note to the balance sheet discloses data on receipts and costs received/carried out in the performance of work, the provision of services, as well as the sale of goods. The document indicates specific figures for certain periods (by years). The resulting difference in accounting for management and production costs must be justified. In this case, specific calculations are given.

Financial result from core activities

The accounting note contains the figures for the current reporting period. In this case, the amount of profit for taxation purposes is indicated. If any information is not reflected in the balance sheet, this fact is explained in the note. Let's say the company has concluded a contract for the supply of a large consignment of goods, but the transfer and signing of the invoice was delayed. The note also indicates the account, which reflects the amount of actual costs for the manufacture of products.

Other income

This section indicates the total amount of income. The document also provides the amount of non-operating income and the amount of funds received from the sale of fixed assets. Based on these data, the amount of income for taxation purposes is indicated. The note explains the reasons for the formation of the difference. Other expenses are described in a similar way.

Income tax calculations

The explanatory note indicates the regulatory document that guides the enterprise when calculating the mandatory payment to the budget. They are PBU 18/02. The note should indicate the specific amount of profit for tax purposes. The sources of information are tax accounting registers and declaration information. The document describes the main operations related to the calculation of the mandatory payment. For example:

"The tax rate for 2013 is 20%. The amount of the calculated obligatory payment to the budget is 327,000 rubles. The amount of accounting profit is 470 thousand rubles. The conditional expense reflected in DB account 99.02.1 is 94 thousand rubles. tax assets at the beginning of 2013 - 50 thousand rubles During the reporting period, there was an increase in IT by 34 thousand rubles due to the formation of a temporary difference in the amount of 170 thousand rubles. It arose as a result of the difference in the amount of the founding contribution of a participant owning 100% of the share capital. The amount of TIT (tax liabilities) in 2013 - 209 thousand rubles. It arose due to permanent differences - 1,045,000 rubles. Current tax from profit of the enterprise, calculated in accordance with the provisions of PBU 18/02 - 327 thousand rubles, which corresponds to the information in the declaration for 2013."

Financial result of economic activity

This section also indicates the specific amount received in the current year. The note contains the factors that influenced the financial result. In particular, they may be incurred and written off as a result of commercial, administrative and other expenses related to the sale of a large batch of finished products produced in the last quarter of the year ended and sold in the first quarter of the beginning period.

Accounting Policy Data

This section indicates the regulatory documents on the basis of which it is formed and approved. Accounting policies describe:

Conclusion

The final documents provided at the end of the period to interested users contain dry numbers. The necessary explanations for certain areas of accounting are given by an explanatory note to the balance sheet. The FSS in some cases requires this document, although the rules do not provide for the obligation of enterprises to provide it. The main users, as a rule, are the founders and the Federal Tax Service. The explanatory note can also be checked by auditors for the compliance of its indicators with the balance figures. In practice, there are usually no difficulties in compiling this document. Since there is no unified form, specialists use well-established unspoken rules for filling out. The explanatory note must be certified by the signatures of the general director and chief accountant.

In the practice of accounting, the degree of disclosure is set as needed and depending on the curator. So, to submit the balance sheet on command (to the head office), some indicators can be specified, and for the tax office, others.

What is an explanatory note to financial statements

The definition of accompanying documentation is based on the provision of Article 5 of the Accounting Regulations (AR) 4 1999. The scope of the application is determined by the requested authorities, also depends on. Large enterprises during the reporting period may be busy compiling several hundred sheets of an explanatory note.

The document itself usually provides a transcript of the key indicators of the enterprise that are of interest to the inspection bodies or. The note can provide calculated indicators, such as the turnover ratio, profitability, or stock indicator. Numerical parameters are calculated based on the lines of the balance sheet.

A large part of the content is a description of the reasons for the formation of accounts receivable and accounts payable, the consequences of an increase or decrease. If in the reporting period there was a bonus (removal of bonuses) for the positions of workers, employees, managers. Often, the note indicates the facts of the movement or disposal of large assets, the reasons (orders for the enterprise).

What is an explanatory note to the financial statements, the video below will tell:

Concept and normative consolidation

The main regulatory act for the purposes of compiling a note with explanations is PBU 4 of 1999. This normative document establishes the need to form a document, but does not reflect its content. The structure and degree of information disclosure is determined by enterprises based on the request of affiliated persons and regulatory authorities. Again, if the founders have the right to receive comprehensive information about the actual state of affairs at the enterprise, then for tax and statistics disclosure of information occurs to a degree sufficient for monitoring.

When compiling a template for an explanatory note, you can refer to the Accounting Law. The standard provides approximate titles of sections in which essential information about the enterprise should be specified.

Composition and role

  • According to the same PBU 4 of 1999, the composition of the explanatory note is determined by requests, and internal (local) regulations. The procedure for disclosing information is fixed in;
  • For the purposes of preparing for writing an audit report, the organization refers to the requirements (request) of the inspectors to draw up. In the absence of an explanatory note in the annexes, there is a risk of receiving a comment about the submission of forms in an incomplete volume or receiving a request for the submission of an additional set of reports.

In the absence of an explanatory note, you can not only encounter a misinterpretation of reporting indicators, but also provided for by the Tax Code, article 126. The chief accountant will also be given a sense of responsibility in accordance with the Administrative Code, article 15.6.

Abandonment order

Due to the fact that there is no single template to fill out in the governing documents and albums, enterprises usually use their own accompanying document forms. As a rule, the note contains several sections, each of which reveals certain performance indicators and determines the results of activities for the reporting period. The paragraphs of the explanations are again developed taking into account the practice of referring to this reporting form.

The standard structure of an explanatory note is as follows:

  • General information. It discloses the legal information of the object of control, the status of the company, types of activities in accordance with. If this does not contradict the corporate Code, the number of employees in the state may be indicated;
  • An excerpt from the accounting policy regarding the display and collection of indicators for reporting;
  • Analysis of the numerical parameters of the balance sheet, analysis of the dynamics of the main indicators of the income statement. This lists at least five major suppliers and five customers;
  • Organization plans for the future, for example;
  • Significant events since the last report;
  • Received loans, financial assistance, participation in government programs;
  • Conclusion.

Forms

Since there is no single form for compiling a note, it is preferable to fix its form in an appendix to the accounting policy. This eliminates the possibility of unreasonable changes in sections of the report when changing officials, leaving on vacation. The manager must also understand that it will not be possible to easily add or remove some sections, you will have to fix your decision in writing.

The PZ form can be downloaded for free.

Explanatory note of financial statements (sample filling)

The principles of financial reporting along with the PP are described in this video:

Reporting period

Most often it is a year. For verification purposes, a slice of indicators can be requested for a shorter period. In any case, accountants should not despair, since information in the early period will later become the basis for compiling a final note.

Who and where provided

An explanatory note, as an integral appendix to the balance sheet, income and expense budget or cash flow statement, is formed by the accounting department or a responsible employee of the financial department. It all depends on the status of the requested enterprise.

For example, the accounting department can compile an application for the tax office, and - for submission to a higher authority. In any case, the actions of specialists must be coordinated. Differences in information may be formal, but must be taken from official credentials.

Provision procedure

Together with reporting forms in paper form or a scanned copy by means of communication.

Audit of the WWC

Analysis of the note reveals the following:

  • Completeness of information;
  • Are key indicators (profit, taxes, deviations from the norm) deciphered?
  • Whether shown, including disposal;
  • Does the company hide the possible;
  • Degree of competence in conducting internal analysis;
  • Is the company growing in the future?

For analysis, the controlling body can use financial formulas to calculate the parameters of interest or indicate the need for such calculations in the content of the explanatory note.

An explanatory note can be created in 1C: Consolidation 8, which the video below will tell about:

An explanatory note to the balance sheet - is it mandatory as part of the annual reporting, who should draw it up and who may not do it, and most importantly, what does it look like? We will talk about this in our article.

Why explain the balance

Reporting should be accurate and complete and give the user a clear picture of the organization's financial position. In the balance sheet and form 2, we provide generalized indicators, from which, as a rule, it is difficult to draw exhaustive conclusions. So they need to be explained.

Let's take the line "Accounts receivable" as an example. To put this figure in the report, it is necessary not only to collect the balances of all settlement accounts, but also to take into account the amount of the reserve for doubtful debts (if any). It is not shown separately in the balance sheet, and interested users (owners, investors, regulatory authorities) need additional explanations in this regard.

All organizations must form explanations, with the exception of:

  • small enterprises entitled to simplified accounting and reporting;
  • public organizations that do not conduct entrepreneurial activities and have no implementation.

In addition, explaining the balance is in the interests of everyone who cares about their reputation. The more fully the figures from the report are disclosed, the more transparent the company's activities will look. Such reporting will help not only to strengthen the credibility, but also to attract new investors. Explanations on the balance sheet will also help to avoid unnecessary questions from regulatory authorities.

Read about the requirements for accounting in the material What are the requirements for accounting? .

NOTE! In clause 39 PBU 4/99 (approved by clauseDecree of the Ministry of Finance of the Russian Federation dated July 6, 1999 No. 43n) it is determined that companies have the right to provide additional information with the reports if it is useful for external users of the reporting. At the same time, the Ministry of Finance believes that companies are obliged to disclose information related to accounting (information of the Ministry of Finance dated 04.12.2012 No. ПЗ-10/2012).

What information does an explanation of the balance sheet contain?

Usually, only for the balance sheet, explanations are not made separately. Since it is not compiled alone, but as part of the reporting, an explanation is given immediately for all submitted reports.

Read about the reporting features of companies using the simplified tax system in the material “How to fill out a balance sheet under the simplified tax system?” .

It should be noted that all traditional reports decipher any lines of the balance sheet, that is, they are also its explanations.

So, from the statement of financial results, we learn about the amount of net profit for the period, and it is an integral part of the line "Retained earnings (uncovered loss)" of the balance sheet.

The Cash Flow Statement provides information on how the Cash and Cash Equivalents line item is formed (broken down by line of business).

The statement of changes in capital deciphers the information reflected in the 3rd section of the balance sheet.

The remaining lines also require transcripts and explanations. Usually they are presented in the form of tables - they are convenient and visual. You can develop their form yourself, or you can use ready-made samples - they are in Appendix 3 to the order of the Ministry of Finance of Russia dated 02.07.2010 No. 66n.

NOTE! Order No. 66n contains an example of explanatory notes on balance sheet information on intangible assets, R&D, fixed assets, financial investments, reserves, debts of debtors and creditors, estimated liabilities, state assistance.

What does a sample explanatory note to the balance sheet look like?

There is no single model of explanations for the balance sheet. Everyone explains what he considers necessary and useful for reporting users.

How an explanation of the balance sheet might look like, we will show with an example.

Notes on the balance sheet

JSC Symphony for 2018

1. General information

Joint Stock Company (JSC) "Symphony" was registered by the Federal Tax Service No. 6 for Moscow on 10/29/2009. (Next, you can provide the following information: OGRN, TIN, KPP, details of the certificate of state registration, address.)

The balance sheet is formed in accordance with the accounting and reporting rules in force in the Russian Federation (if the balance sheet is prepared in accordance with IFRS, this must be indicated).

Authorized capital: 1,000,000 (one million) rubles.

Number of shares: 1,000 shares with a par value of 1,000 (one thousand) rubles.

Primary activity: milk processing and cheese production (OKVED 10.51).

Composition of affiliated persons:

Steklov Andrey Anatolyevich - Member of the Board of Directors;

Zavarzin Stepan Nikolaevich — Member of the Board of Directors.

2. Main provisions of the accounting policy

The accounting policy was approved by the order of the director dated December 25, 2017 No. 156 (hereinafter, its main provisions are briefly given: depreciation methods, methods for assessing assets and liabilities, etc.).

3. Balance structure (each line is shown in % of the balance currency, changes for the period are calculated).

4. Valuation of net assets (the amount of net assets is correlated with the authorized capital).

5. Analysis of the main financial indicators (financial ratios are indicated: liquidity, reserves, autonomy, return on assets, etc.; the same section analyzes the degree of dependence on creditors, the situation on the securities market, etc.).

6. Composition of fixed assets (rubles):

Name

Initial cost

Depreciation

Book value as of 31.12.2018

Land

Buildings, structures

Vehicles

Equipment

Inventory

7. Estimated liabilities and provisions

As of December 31, 2018, an estimated obligation to pay regular vacations was formed in the amount of 1,426,000 rubles, the number of unpaid vacation days is 67, the due date is 2019.

The allowance for doubtful debts was formed in the amount of 1,678,000 rubles. in connection with the presence of overdue and unsecured debt of Tihiye Zori LLC.

Provision for impairment of inventories was not created due to the absence of indications of impairment of inventories.

8. Labor and wages

Payables for wages as of December 31, 2018 amounted to 1,679,000 rubles. (for December 2018, due date: 01/15/2019). Personnel turnover in the reporting period amounted to 24.98%, payroll - 167 people. The average monthly salary is 20,675 rubles.

9. Issued and received security and payments (all types are indicated).

10. Other information

(A list of extraordinary facts, their consequences, a description of significant facts that affected the balance sheet, major transactions made, events after the reporting date, adjustments made and other necessary information is provided.)

Director of JSC Symphony Devyatov Devyatov A. N. 03/20/2019

Results

Explanations to the balance sheet are allowed to be made in any form. They may contain tables, graphs and charts. The detailing of information in them is permissible in the most diverse way - it all depends on the intention of the company in a certain way to disclose any important indicators. The main thing is that the information contained in the explanations be reliable and useful for users.