Digest Finance
 

Financial Capital: Accounting Procedures and Respective Comments

Vol. 23, Iss. 3, SEPTEMBER 2018

PDF  Article PDF Version

Received: 14 June 2018

Received in revised form: 24 July 2018

Accepted: 30 July 2018

Available online: 28 September 2018

Subject Heading: FINANCE OF ORGANIZATIONS. ANALYSIS OF ACCOUNTING SYSTEMS

JEL Classification: M40, M41

Pages: 243-253

https://doi.org/10.24891/df.23.3.243

Plotnikov V.S. Novosibirsk State University of Economics and Management (NSUEM), Novosibirsk, Russian Federation
vcplotnikov@yandex.ru

https://orcid.org/0000-0001-7214-1847

Plotnikova O.V. Novosibirsk State University of Economics and Management (NSUEM), Novosibirsk, Russian Federation
vcplotnikov@yandex.ru

https://orcid.org/0000-0002-2384-6418

Bezhan M.V. Plekhanov Russian University of Economics (PRUE), Sevastopol Branch, Sevastopol, Russian Federation
mm180883@mail.ru

https://orcid.org/0000-0002-1570-1091

Importance In this research, we formulate a body of theoretical and conceptual principles for the business accounting model, which would make the general set of benchmarks to recognize and carry items of financial capital stocks in integrated reporting.
Objectives It is reasonable to use the concept for maintaining the financial capital during its conversion into other types of capital. This provision of the business accounting model is based on specific accounting procedures for recognizing the creation of the financial capital value and its conversion and accompanied with respective comments.
Methods The methodology rests on general theories of positive and normative economics and general methods of observation, abstraction, deduction and induction, statistical and fact analysis of economic phenomena.
Results As a result of the research, we qualify financial assets, cash, equity instruments of the other entity and contractual rights as items of financial capital. They mainly determine its value. Goodwill is a part of the value of long-term financial instruments, rather than an intangible asset. Changes in its value signify the impairment of other assets, investee’s assets. Accounts receivables shows the monetized portion of the financial capital value.
Conclusions and Relevance To illustrate the result of the research, we perform accounting procedures by consecutively recognizing entries for forming the financial capital stock in the business accounting model and determining specific techniques – monetization of financial capital metrics and capitalization of cash which form and change the value of certain items of financial capital.

Keywords: business accounting, integrated reporting, model, stock value, financial asset, monetary assets and liabilities, cash resources capitalization, accounting procedures

References:

  1. Friedman M., Savage L.J. Analiz poleznosti pri vybore sredi al'ternativ, predpolagayushchikh risk. V kn.: Teoriya potrebitel'skogo povedeniya i sprosa [The Utility Analysis of Choices Involving Risk. In: The Theory of Consumer Behavior and Demand]. St. Petersburg, Ekonomicheskaya shkola Publ., 1993, pp. 209–230.
  2. Plotnikov V.S., Plotnikova O.V. [Philosophy of accounting as an economic science (Part 1)]. Uchet. Analiz. Audit = Accounting. Analysis. Auditing, 2017, no. 2, pp. 7–17. URL: Link (In Russ.)
  3. Hausman D.M. (Ed.) Filosofiya ekonomiki. Antologiya [The Philosophy of Economics: An Anthology]. Moscow, Gaidar Institute Publ., 2012, 520 p.
  4. Plotnikov V.S., Plotnikova O.V. [Philosophy of Accounting as an Economic Science]. Uchet. Analiz. Audit = Accounting. Analysis. Auditing, 2017, no. 3, pp. 7–21. URL: Link (In Russ.)
  5. Sokolov Ya.V. Osnovy teorii bukhgalterskogo ucheta [Fundamentals of accounting theory]. Moscow, Finansy i statistika Publ., 2000, 496 p.
  6. Baetge J. Balansovedenie [Bilanzen]. Moscow, Bukhgalterskii uchet Publ., 2000, 454 p.
  7. Plotnikov V.S., Plotnikova O.V. [Goodwill as a capitalization of transaction costs of a business combination]. Ekonomicheskii analiz: teoriya i praktika = Economic Analysis: Theory and Practice, 2017, vol. 16, iss. 1, pp. 145–159. (In Russ.) URL: Link
  8. Galagan A.M. Osnovy obshchego schetovedeniya [Basics of general accounting]. Moscow, Narkomtorg SSSR i RSFSR Publ., 1928, 436 p.
  9. Plotnikov V.S., Plotnikova O.V. [The concept of positive accounting obligations]. Mezhdunarodnyi bukhgalterskii uchet = International Accounting, 2013, vol. 16, iss. 23, pp. 9–17. (In Russ.)
  10. Furubotn E.G., Richter R. Instituty i ekonomicheskaya teoriya: Dostizheniya novoi institutsional'noi ekonomicheskoi teorii [Institutions and Economic Theory: The Contribution of the New Institutional Economics]. St. Petersburg, St. Petersburg State University Publ., 2005, 702 p.
  11. Plotnikov V.S., Plotnikova O.V. [In the conceptual basis of accounting]. Auditor, 2014, no. 9, pp. 52–61. URL: Link (In Russ.)
  12. Hull J.C. Optsiony, f'yuchersy i drugie proizvodnye finansovye instrumenty [Options, Futures, and Other Derivatives]. Moscow, Vil'yams Publ., 2008, 1024 p.
  13. Yakutin Yu. [Conceptual approaches to the evaluation of the effectiveness of corporate integration]. Rossiiskii ekonomicheskii zhurnal = Russian Economic Journal, 1998, no. 6, pp. 71–81. (In Russ.)
  14. Plotnikov V.S., Plotnikova O.V. Ob"edinenie biznesa i konsolidirovannaya finansovaya otchetnost': monografiya [Business combination and consolidated financial statements: a monograph]. Moscow, INFRA-M Publ., 2018, 278 p. URL: Link
  15. Plotnikov V.S., Plotnikova O.V., Bezhan M.V., Mel'nikov V.I. [Conceptual framework for consolidated financial statements]. Mezhdunarodnyi bukhgalterskii uchet = International Accounting, 2015, vol. 18, iss. 39, pp. 2–26. URL: Link (In Russ.)

View all articles of issue

 

ISSN 2311-9438 (Online)
ISSN 2073-8005 (Print)

Journal current issue

Vol. 23, Iss. 3
September 2018

Archive