Features of the audit of consolidated statements. Audit of the consolidated financial statements prepared in accordance with IFRS Audit of the consolidated statements

Consolidated financial statements as a type of accounting (financial) statements are intended to characterize the financial position and financial result of the activities of a group of economic entities based on control relations. That is, the reporting of a group of economic entities is drawn up as if it were compiled by a single (one) economic entity. The consolidated financial statements are primarily for information purposes and are made available to interested external users.

Federal Law No. 208-FZ of July 27, 2010 “On Consolidated Financial Statements” gives the following definition: “... systematized information reflecting the financial position, financial performance and changes in the financial position of an organization, foreign organizations in accordance with International Financial Reporting Standards (IFRS) is defined as a group. " However, the above definition is applicable only for the purposes of the said law.

It should be noted that on the territory of the Russian Federation, IFRS and Interpretations of IFRS are applied, adopted by the Fund for International Financial Reporting Standards and recognized in the manner established by the Government of the Russian Federation in agreement with the Bank of Russia. The specified procedure presupposes the approval of the texts of IFRS and Interpretations of IFRS by the Ministry of Finance of Russia in the form of orders.

The consolidated financial statements of an organization are drawn up along with the accounting (financial) statements of this organization, drawn up in accordance with the Federal Law “On Accounting”.

Consolidated financial statements can also be prepared in accordance with national rules and regulations accounting, for example, Russian rules, US rules (US GAAP) etc. In some Russian regulatory documents, such reporting may be called consolidated or consolidated (consolidated), which is due to historical reasons.

In Russian practice, the following classification of reporting types is quite often used:

• consolidated reporting - compiled by combining (as a rule, by simple line-by-line summation) of individual current reports (balance sheets, etc.) of the organization and its divisions; mainly compiled by executive authorities, government agencies, credit institutions in their daily activities, etc.;
• Consolidated reporting - is compiled by consolidating (combining, taking into account the share of ownership or control over assets, property) reports (balance sheets, etc.) of legally independent organizations that are economically interconnected; such reports are used by holding companies (owning controlling stakes in other companies), parent organizations in relations with their subsidiaries and affiliates. Most often, consolidated financial statements are prepared in accordance with the requirements of IFRS.

The main legislative and regulatory documents on the basis of which the consolidated statements are prepared and presented to users include:

• 1) according to Russian standards: order of the Ministry of Finance of Russia dated 30.12.1996 No. 112 "О guidelines on the preparation and presentation of consolidated financial statements ”;
• 2) according to International Financial Reporting Standards:
  • - Federal Law “On Consolidated Financial Statements”;
  • - Decree of the Government of the Russian Federation of February 25, 2011 No. 107 "On Approval of the Regulation on the Recognition of International Financial Reporting Standards and Clarifications of International Financial Reporting Standards in the Territory Russian Federation»;
  • - Order of the Ministry of Finance of Russia dated November 25, 2011 No. 160n "On the introduction of International Financial Reporting Standards and Interpretations of International Financial Reporting Standards in the Russian Federation";
  • - Order of the Ministry of Finance of Russia dated July 18, 2012 No. 106n "On the introduction and termination of the International Financial Reporting Standards in the Russian Federation";
  • - Order of the Ministry of Finance of Russia dated October 31, 2012 No. 143n "On the introduction and termination of the International Financial Reporting Standards in the Russian Federation";
  • - Order of the Ministry of Finance of Russia dated 02.04.2013 No. 36n "On the introduction and termination of the International Financial Reporting Standards in the Russian Federation";
  • - Order of the Ministry of Finance of Russia dated December 24, 2013 No. 135n "On the introduction of documents of International Financial Reporting Standards in the Russian Federation";
  • - Order of the Ministry of Finance of Russia dated January 21, 2015 No. 9n "On the introduction and termination of the validity of documents of International Financial Reporting Standards in the Russian Federation."

In accordance with the provisions of sect. V of the Regulations on accounting and reporting in the Russian Federation (clauses 91, 96, 97), if the organization has subsidiaries and dependent companies, in addition to its own accounting report, it is also compiled consolidated accounting statements, including indicators of reports of such companies located on the territory of the Russian Federation and abroad. The procedure for drawing up these reports for most Russian organizations is established by order of the Ministry of Finance of Russia dated December 30, 1996 No. 112 "On methodological recommendations for the preparation and presentation of consolidated financial statements."

Consolidated financial statements are a system of indicators that reflect the financial position at the reporting date and financial results for the reporting period of a group of related organizations. The consolidated financial statements of the group combine the financial statements of the parent company and its subsidiaries, and also include data on the dependent companies. In relation to subsidiaries, the parent organization acts as the parent company, in relation to dependent companies - as the dominant (participating) company. Consolidated financial statements combine the financial statements of subsidiaries and include data on dependent companies that are legal entities under the legislation of the place of its state registration.

The financial statements of a subsidiary are combined into consolidated financial statements if:

• 1) the parent organization owns more than 50% of the voting shares of a joint-stock company or more than 50% of the authorized capital of a limited liability company;
• 2) the parent organization has the ability to determine the decisions made by the subsidiary in accordance with the agreement concluded between the parent organization and the subsidiary;
• 3) if the parent organization has other methods of determining the decisions made by the subsidiary.

Information on affiliated companies is included in the consolidated financial statements if the parent organization has more than 20% of the voting shares of the joint stock company or more than 20% of the authorized capital of the limited liability company.

The Group may not draw up consolidated financial statements in accordance with the rules stipulated by regulatory acts and methodological guidelines for accounting of the Ministry of Finance of Russia, if the following conditions are simultaneously met:

• consolidated financial statements are prepared on the basis of IFRS;
• the group must ensure the reliability of the consolidated financial statements prepared on the basis of IFRS;
• explanations (explanatory note) to the consolidated financial statements contains a list of applicable accounting requirements, discloses methods of accounting, including estimates that differ from the rules provided for by regulatory acts and methodological guidelines for accounting of the Ministry of Finance of Russia.

Consolidated financial statements prepared in accordance with the requirements of standards other than Russian accounting standards (regulations) (RAS), such as IFRS and GAAPK as noted above, it is customary to call consolidated.

In light of the reform of Russian accounting and reporting standards, consistently carried out by the Ministry of Finance of Russia, their convergence with IFRS, and also taking into account the fact that a significant number of Russian companies (banks, large joint stock companies engaged in foreign economic activity, etc.) years are reporting in accordance with IFRS, the most relevant, demanded area of ​​audit is the audit of consolidated financial statements, drawn up primarily in accordance with IFRS. Consider the purpose, composition and complex of issues arising from the audit of such statements.

Consolidated financial statements in accordance with IFRS, it is left by a group of companies to meet the information needs of various stakeholders and serves as the basis for making economic decisions by such persons. Consequently, such reports must contain reliable information on the results of the financial and economic activities of the group of companies, and the reliability of such information must be confirmed by an independent audit. Currently, large Russian groups of companies prepare such reports at the request of various structures - banks, stock exchanges, shareholders.

In accordance with the Federal Law “On Consolidated Financial Statements”, IFRS statements are:

• 1) credit organizations;
• 2) insurance organizations (with the exception of medical insurance organizations operating exclusively in the field of compulsory health insurance);
• 3) non-state pension funds;
• 4) management companies of investment funds, mutual funds and non-state pension funds;
• 5) clearing organizations;
• 6) federal state unitary enterprises, the list of which is approved by the Government of the Russian Federation;
• 7) open joint stock companies, the shares of which are in federal ownership and the list of which is approved by the Government of the Russian Federation;
• 8) other organizations whose securities are admitted to organized trading by including them in the quotation list.

If federal laws provide for the preparation, and (or) submission, and (or) publication of consolidated financial statements (consolidated financial statements, consolidated (consolidated) statements and balance sheets) or if the constituent documents of an organization not specified in the above list provide for the submission and (or) publication of consolidated financial statements, such statements are also prepared in accordance with the Federal Law “On Consolidated Financial Statements”.

In addition, it should be noted that this law also applies to the preparation, presentation and publication of financial statements by organizations that do not create a group. In the title of such financial statements, the word "consolidated" is not used.

Currently, the Federal Law "On Consolidated Financial Statements" does not apply to public sector organizations, nor does it apply to consolidated (summary) budgetary statements, consolidated statements of state (municipal) institutions formed in accordance with the budgetary legislation of the Russian Federation.

An entity must publish annual consolidated financial statements that are subject to statutory audits. The auditor's report is presented and published together with these consolidated financial statements.

According to federal law "O consolidated financial statements ”organizations, whose securities are admitted to organized trading by listing them and which prepare consolidated financial statements in accordance with internationally accepted rules other than IFRS, are required to present and publish consolidated financial statements starting from the statements for 2015.

If only the bonds of the organization are admitted to organized trading by including them in the quotation list, such an organization is obliged to draw up, submit and publish consolidated financial statements starting from the reporting for 2014.

The organizations specified in clauses 3-5 of the above list are required to prepare, submit and publish consolidated financial statements starting from the reporting for 2015, and the organizations specified in clauses 6 and 7, starting with the reporting for the year following the year , in which they are included in the lists approved by the Government of the Russian Federation.

All other organizations prepare, submit and publish consolidated financial statements starting from the statements for the year following the year in which IFRS are recognized for application in the Russian Federation, i.e. starting from the reporting for 2012

Purpose of verification and sources of information. The objective of an audit of the consolidated financial statements prepared in accordance with IFRS is to express the auditor's opinion on whether the consolidated financial statements have been prepared, in all material respects, in accordance with IFRS.

The subject matter of opinion is the consolidated financial statements as a whole, i.e. the totality of all its constituent elements. Consequently, the IFRS consolidated financial statements are free of misstatement if the following conditions are met:

• the composition of the group of companies is determined based on the requirements of IFRS;
• the unified accounting policy of the group of companies for the purposes of consolidation is drawn up taking into account all the requirements and amendments to IFRS;
• IFRS statements of subsidiaries are based on RAS statements, which do not contain distortions, taking into account the requirements of a unified accounting policy;
• the consolidation process passed without errors, taking into account all the requirements of IFRS;
• additional information is disclosed in the consolidated financial statements in accordance with the requirements of IFRS.

During the audit of the consolidated financial statements prepared in accordance with IFRS, the following main tasks should be solved:

• 1) checking the justification for the inclusion of subsidiaries in the group of companies for the purposes of consolidation;
• 2) checking the reflection of the principles of IFRS in the unified accounting policy of the group of companies for the purposes of consolidation;
• 3) checking the correctness of the preparation of financial statements by the subsidiaries of the group:
  • accounting (financial) statements in accordance with Russian accounting standards (RAS);
  • financial statements in accordance with IFRS;
• 4) checking the correctness of the consolidation process and obtaining consolidated financial statements in accordance with IFRS;
• 5) checking the completeness of information disclosure in the notes to the consolidated financial statements in accordance with IFRS.

Sources of information are used when checking the consolidated financial statements in accordance with IFRS.

I. Organizational and administrative documents.

• charter of the parent company, charters of subsidiaries;
• accounting policy (accounting policies) of the parent company and subsidiaries, accounting policy for the purpose of consolidating the financial statements of a group of companies in accordance with IFRS;
• plan (s) of accounts of the parent company and subsidiaries;
• intragroup procedures for documentation, processing of accounting information, preparation of financial statements, consolidation of financial statements.

II. Reporting of a group of companies:

• accounting statements according to RAS of companies belonging to the group of companies for the reporting and previous periods;
• financial statements in accordance with IFRS of companies belonging to the group of companies for the reporting and previous periods;
• consolidated financial statements prepared in accordance with IFRS for the reporting and prior periods.

III. Supporting information:

• oral and written statements and explanations of the management of the group of companies, top management of the parent and (or) subsidiaries;
• the auditor's working papers and previous correspondence with the client if the audit is recurring (i.e. the client is ongoing);
• client's correspondence with tax authorities, acts of tax audits;
• accounting data and supporting information, including contracts, primary documents and confirmations from third parties;
• audit reports and reports (written information) for previous reporting periods.

Let us consider in more detail the procedures for checking the consolidated financial statements in accordance with IFRS at each stage.

• 1. Checking the structure of the group of companies. At this stage, the task of the auditor is to build a diagram of the companies included in the group. Also, associated companies must be included in this scheme. The working paper should highlight the following data for each of the subsidiaries:
  • the name of the subsidiary;
  • address;
  • country of location;
  • the parent company's share of control over the subsidiary;
  • types and details of documents confirming the control of the parent company over the subsidiary. With a complex control scheme, a description and documentary confirmation of the existence of control. In the case of control without documents - confirmation of the facts of control. In the absence of control, while observing all the formal signs of control - a statement from the management with a detailed explanation of the situation;
  • date of purchase;
  • the date of the planned sale;
  • the date of the planned termination of activities;
  • the last period in which the official accounting (financial) statements were audited;
  • share in the group's income;
  • share in the group's assets;
  • share in the group's liabilities;
  • the auditor's opinion on the legality of including the subsidiary in the group of companies.

After building a diagram of a group of companies, the auditor should receive answers to the following key questions:

• whether all subsidiaries took part in the consolidation process;
• what is the exact geographic spread of the group, i.e. in which countries are the companies included in the group of companies;
• what is the state of the official accounting reports - based on the reports of the auditors of subsidiaries;
• what is the share of subsidiaries in the main items of financial statements.

Based on these data, the auditor can include subsidiaries in the audit program of the consolidated financial statements or exclude them from the program.

The summary results of this procedure are drawn up in the auditor's working document, which includes information about all subsidiaries.

2. Review of the accounting policies of the group of companies for consolidation purposes. To assess the principles on the basis of which the consolidated financial statements are formed, and to assess the compliance of the accounting policies of the group of companies with the principles of IFRS, the auditor must get an idea of ​​the accounting policies of the audited group of companies.

Accounting policy analysis is carried out:

• in order to establish discrepancies in the definition of financial reporting indicators for the accounting policy of the group of companies and IFRS;
• identification of the key elements at risk;
• Expressing an opinion on the accounting policies applied by the auditee group.

If there is a discrepancy between the principles specified in the group's accounting policies for consolidation purposes, the auditor should indicate in his working documents the discrepancies found and the effect of such discrepancies on the consolidated financial statements.

• 3. Checking the reporting of subsidiaries. At this stage, the auditor needs to obtain evidence that the preparation of separate financial statements of subsidiaries in accordance with IFRS is organized at the proper level, the statements do not contain material distortions, and are based on the accounting policy for the purposes of consolidation of the group of companies. For subsidiaries selected by the auditor to conduct an audit, it is necessary to obtain assurance that:
  • the subsidiary prepares financial statements in accordance with IFRS, taking into account all the requirements of IFRS and the accounting policy of the group of companies for consolidation purposes;
  • the financial statements of the subsidiary are free from misstatements. If such statements have been audited, it is most often impractical to conduct a re-audit;
  • to eliminate the inconsistency between the accounting policy of the subsidiary and the accounting policy for the consolidation of the group under IFRS, a set of adjusting entries is applied, which eliminates these discrepancies;
  • computer information systems used in the subsidiary comply with intragroup standards, which are drawn up with the requirements of IFRS;
  • management personnel have no hidden interest in deliberately misrepresenting the results of IFRS financial statements in order to obtain remuneration. For example, the annual bonus for management personnel is calculated based on the results of reporting in accordance with IFRS;
  • the personnel preparing the IFRS reporting has sufficient qualifications and knowledge in this area.

Based on his professional opinion and taking into account the specifics of the subsidiary, the auditor chooses the procedures that must be followed to verify the correctness of the IFRS reporting of subsidiaries.

After the completion of this stage, the auditor will form an opinion that the group of companies was formed based on the requirements of IFRS and the reporting of subsidiaries in accordance with IFRS is built on the basis of financial statements, the reliability of which has been confirmed by an independent auditor, taking into account the requirements of accounting policies for consolidation purposes in accordance with IFRS requirements.

4. Checking the process of consolidating financial statements. First of all, it is necessary to check the compliance of the eliminated (eliminated) indicators and the use of a single exchange rate. In practice, when preparing consolidated financial statements, one of the most common mistakes is inconsistency in the balances of intra-group transactions of subsidiaries. This error occurs especially often in cases where the group includes companies that keep records in different currencies. During the consolidation process, such inconsistencies result in incomplete folding of intragroup results and misstatements in the consolidated financial statements.

After that, they check the correctness of the consolidation procedure in accordance with IFRS. At this stage, the auditor needs to obtain confidence that the consolidation procedure has been carried out in accordance with the requirements of IFRS. The main questions at this stage for the auditor will be:

• application of uniform exchange rates by all subsidiaries;
• preparation of financial statements in accordance with IFRS by subsidiaries as of a single date with consolidated financial statements;
• calculation of the minority interest in accordance with the requirements of IFRS;
• exclusion of balances for intragroup transactions;
• the absence of arithmetic errors in the item-by-item summation of the reporting indicators of subsidiaries;
• replacing the value of the parent's investment in subsidiaries with a portion of the subsidiary's equity.

In the practice of companies that prepare consolidated financial statements, various computer information systems are most often used to prepare consolidated financial statements. The task of such systems is to carry out consolidation based on the reporting of subsidiaries. In such systems, the reporting of subsidiaries is fed into the input in the form of specially created files, and the output is consolidated reporting. Examples of such systems are "INEK-Analyst" of the "INEK" company, " AuditExpertProfessional " company Expert Systems and others. In the case of application of systems created but ordered by a group of companies on an individual basis, the auditor needs to obtain evidence that the system is carrying out the consolidation process in accordance with the requirements of IFRS. In this case, in accordance with the requirements of FPSAD No. 32 "The use of the results of an expert's work by the auditor" / MCA 620 "Using the work of an expert", the work of an expert in the field of information technology should be used.

5. Checking the completeness of the disclosures in the notes to the consolidated financial statements. At this stage, the completeness of the disclosure of information in the notes (notes) to the consolidated financial statements is checked.

IFRS (IAS) 1 "Presentation of financial statements" defines the information contained in the notes to the financial statements as "information that supplements the data in the statement of financial position, statement (s) of profit or loss and other comprehensive income, separate income statement, statement of changes in equity and cash flow statement. The notes include descriptions or detailed explanations of items disclosed in these statements, as well as information about items that are not subject to recognition in the statements. "

Many groups of companies, in addition to financial statements, provide a so-called financial review for the management of the organization, which describes and explains the main characteristics of the organization's results of operations, its financial position and the main uncertainties that it faces. Such a report may provide an overview of:

• the main factors and influences that determine financial results, including changes in the environment in which the organization operates, the organization's reactions to these changes and their impacts, as well as the organization's investment policy aimed at maintaining and improving financial results, including its dividend policy;
• sources of financing of the organization and its planned indicators of the ratio of liabilities and equity capital;
• funds of the organization that are not recognized in the balance sheet in accordance with IFRS.

In the process of auditing the consolidated financial statements, the disclosure of completeness of information in the notes to the financial statements plays an important role, since each group of companies develops the forms of consolidated statements for itself on an individual basis, depending on the type of business, the structure of the group, the purposes of preparing consolidated statements in accordance with IFRS.

Frequently, the notes (notes) to the consolidated financial statements provide information of a non-financial nature. The auditor, in turn, must be sure that any additional information presented in the statements that is not covered by the auditor's opinion is clearly and clearly separated from the information verified during the audit of the financial statements. If the auditor concludes that any information not subject to audit does not differentiate clearly enough from the financial statements, he should include in the auditor's report an explanation that this information was not subject to verification.

The fact that the additional information is not subject to verification does not relieve the auditor from the need to consider this information in order to identify material inconsistencies with the financial statements. The auditor's responsibilities in relation to additional information are established by FPSAD No. 27 "Other information in documents containing audited financial (accounting) statements" / MCA 720 "Responsibilities of the auditor to review other information in documents containing audited financial statements".

• From the English. Generally Accepted Accounting Principles - the name of the accounting standards in force in the United States.
• Approved by order of the Ministry of Finance of Russia dated November 25, 2011 No. 160n.

The main legislative and regulatory documents governing the object of inspection. Auditing Consolidated financial statements prepared in accordance with IFRS are carried out on the basis of the following legislative and regulatory documents that form the information base of the audit.

1. International Standards on Auditing.

2. International financial reporting standards.

3. Civil Code of the Russian Federation.

4. Tax Code of the Russian Federation.

7. Order of the Ministry of Finance of the Russian Federation "On approval of the Regulations for the maintenance of accounting and financial reporting in the Russian Federation" No. 34n dated July 29, 1998.

8. Order of the Ministry of Finance of the Russian Federation "On approval of the Chart of accounts for accounting of financial and economic activities of organizations and instructions for its application" No. 94n dated October 31, 2000.

9. Order of the Ministry of Finance of the Russian Federation "On approval of the Accounting Regulations" Accounting policy of the organization "PBU 1/98" No. 60n dated December 9, 1998.

10. Order of the Ministry of Finance of the Russian Federation "On the forms of financial statements of organizations" No. 67n dated July 22, 2003.

One of the time-consuming and urgent tasks of the audit in the light of recent changes in legislation and in the economic situation in the Russian Federation is the audit of consolidated financial statements prepared in accordance with International Financial Reporting Standards (IFRS). Consider the purpose, composition and complex of issues arising from the audit of such statements.

Consolidated financial statements are prepared by a group of companies to meet the information needs of various stakeholders and serve as the basis for making economic decisions by such persons. Consequently, such reports must contain reliable information on the results of the financial and economic activities of the group of companies, and the reliability of such information must be confirmed by an independent audit.

Currently, large Russian groups of companies prepare such reports at the request of various structures - banks, stock exchanges, shareholders. In the near future, with the adoption of the Law "On Consolidated Financial Statements", such reporting will be mandatory for groups of companies whose shares are listed on the stock exchange. Also, according to the draft law, such reporting will have to be audited without fail.

Purpose of verification and sources of information. The Australian Auditing Standards (ISAs) state the objective of an audit as follows: “The objective of an audit of financial statements is to enable the auditor to express an opinion on whether the financial statements are prepared, in all material respects, in accordance with established financial reporting principles.” Consolidated financial statements meet the definition of financial statements under IFRS. Therefore, the objective of an audit of the consolidated financial statements prepared in accordance with IFRS is to express the auditor's opinion on whether the consolidated financial statements have been prepared, in all material respects, in accordance with IFRS.

The subject matter of opinion is the consolidated financial statements as a whole, i.e.

The collection of all its constituent elements. Consequently, the IFRS consolidated financial statements are free of misstatement if the following conditions are met:

The composition of the group of companies is determined based on the requirements of IFRS;

The unified accounting policy of the group of companies for the purposes of consolidation is drawn up taking into account all the requirements and amendments to IFRS;

IFRS reporting of subsidiaries is based on RAS reporting, which does not contain distortions, taking into account the requirements of a unified accounting policy;

The consolidation process passed without errors, taking into account all the requirements of IFRS;

Additional information is disclosed in the consolidated financial statements in accordance with the requirements of IFRS.

During the audit of the consolidated financial statements prepared in accordance with IFRS, the following main tasks should be solved.

1. Checking the justification for the inclusion of subsidiaries in the group of companies for the purposes of consolidation.

2. Checking the reflection of IFRS principles in the unified accounting policy of the group of companies for the purposes of consolidation.

3. Verification of the correctness of the preparation of financial statements by the subsidiaries of the group:

Financial statements in accordance with Russian Accounting Standards (RAS);

Financial statements under IFRS.

4. Checking the correctness of the consolidation process and obtaining the consolidated financial statements in accordance with IFRS.

5. Checking the completeness of the disclosures in the notes to the consolidated financial statements in accordance with IFRS.

Sources of information used in the audit of the consolidated financial statements in accordance with IFRS:

I. Organizational and administrative documents:

Charter of the parent company, charters of subsidiaries;

Accounting policies of subsidiaries and parent companies, accounting policies for the purposes of consolidating the financial statements of a group of companies in accordance with IFRS;

Chart of accounts of subsidiaries and parent companies;

Intra-group procedures for documenting, processing accounting information, preparing financial statements, and consolidating financial statements.

II. Reporting of the group of companies:

RAS financial statements of companies belonging to the group of companies for the reporting and previous periods;

Financial statements in accordance with IFRS of companies belonging to the group of companies for the reporting and previous periods;

Consolidated financial statements prepared in accordance with IFRS for the reporting and prior periods.

III. Supporting information:

Verbal and written statements of the management of the group of companies, top management of the parent and (or) subsidiaries;

Working papers of the auditor and correspondence with the client over the past years, if the client is a regular one;

Client's correspondence with tax authorities, acts of tax audits;

Accounting data and supporting information, including contracts, primary documents and confirmations from third parties;

Audit reports of previous years.

The plan and program of the audit of the consolidated financial statements in accordance with IFRS. The content of the plan and program of the audit of the consolidated financial statements in accordance with IFRS are given in table. 18.10 and 18.11.

Table 18.10. General plan of the audit of the consolidated financial statements in accordance with IFRS

Audited organization OJSC "Group 4"

Number of man-hours 720

Head of the audit group Peskov M.V.

The composition of the audit group Peskov M.V., Zolotarev I.A.,

R.V. Karpov

Planned audit risk 4%

Planned level of materiality 1) qualitative - compliance

regulations 2) quantitatively - 2%

№	Planned types of work (task complexes)	Period holding	Performers
1	Checking the structure of a group of companies	January 2007	Peskov M.V.
2	Review of the accounting policies of the group of companies for consolidation purposes	February 2007	Peskov M.V. Zolotarev I.A.
3	Verification of reporting of subsidiaries	April 2007	Peskov M.V. Zolotarev I.A.
4	Checking the Consolidation Process of Financial Statements	April 2007	R.V. Karpov
5	Verification of completeness of disclosures in the consolidated financial statements	May 2007	R.V. Karpov

Table 18.11. Audit program for the consolidated financial statements in accordance with IFRS

Organization audited Audit period

Number of man-hours Leader of the audit team Composition of the audit team

Planned audit risk Planned materiality level

Peskov M.V.

Peskov M.V., Zolotarev I.A., Karpov R.V.

1) qualitatively - compliance with regulatory enactments

2) quantitatively - 2%

bgcolor = white> Period

holding

№		Performers	Workers the documents auditor
1. Checking the structure of the group of companies
1.1	Study of the composition of subsidiaries	January 2007	Peskov M.V.	Charters, constituent documents, contracts for the acquisition of shares of companies. Financial statements of subsidiaries
1.2	Analysis of compliance with the conditions for inclusion of subsidiaries in the consolidation process	January 2007	Peskov M.V.	Charters, articles of association, management statements
1.3	Analysis of the quality of accounting by subsidiaries	January 2007	Peskov M.V.	Past Audit Reports
2. Checking the accounting policies of the group of companies for consolidation purposes
2.1	Analysis of compliance of the principles disclosed in the accounting policy for the purposes of consolidation with the principles of IFRS	February	Peskov M.V. Zolotarev IA.	Accounting policies for consolidation purposes
2.2	Analysis of internal procedures for the preparation of consolidated financial statements	February	Peskov M.V. Zolotarev IA.	Accounting policies for consolidation purposes, internal regulations

Continuation of table. 18.11 № Name of audit procedures Period holding Performers Workers the documents auditor 2.3 Compilation of a register of indicators in the reporting of subsidiaries and parent companies, which are different under IFRS and RAS February Peskov M.V. Zolotarev IA. Accounting policies for consolidation purposes, internal regulations 3. Checking the reporting of subsidiaries 3.1 Audit of financial statements in accordance with RAS of subsidiaries selected for audit April 2007 Peskov M.V. Zolotarev IA. Reporting in accordance with RAS, reports of official auditors, primary documents 3.2 Audit of financial statements in accordance with IFRS of subsidiaries selected for audit April 2007 Peskov M.V. Zolotarev IA. IFRS reporting, accounting policies for consolidation purposes 3.3 Compilation of a register of errors in the preparation of financial statements by subsidiaries April 2007 Peskov M.V. Zolotarev IA. Reporting of subsidiaries under RAS and IFRS 4. Checking the process of consolidating financial statements 4.1 Checking the consistency of translation of exchange rates at the reporting date April 2007 R.V. Karpov Directory of exchange rates, financial statements of subsidiaries 4.2 Verification of mutual elimination of intra-group indicators April 2007 R.V. Karpov Financial statements of subsidiaries 4.3 Verification of the calculation of minority interest April 2007 R.V. Karpov Financial statements of subsidiaries, consolidated financial statements 5. Verification of completeness of disclosures in the consolidated financial statements 5.1 Analysis of the completeness of the disclosure of the basic principles of accounting policies in the notes to the KFO May 2007 R.V. Karpov Notes to the Consolidated Financial Statements

Methodology for checking the consolidated financial statements in accordance with IFRS. Let's consider in more detail the procedures at each stage.

1. Checking the structure of the group of companies. At this stage, the task of the auditor is to build a "diagram" of the companies included in the group. Also, associated companies must be included in this scheme. The working paper should highlight the following data for each of the subsidiaries:

Subsidiary name;

Country of location;

The share of control of the parent company over the subsidiary;

Types and details of documents confirming the control of the parent company over the subsidiary. With a complex control scheme, a description and documentary confirmation of the existence of control. In the case of control without documents - confirmation of the facts of control. In the absence of control, while observing all the formal signs of control - a statement from the management with a detailed explanation of the situation;

Purchase date;

The date of the planned sale;

The date of the planned termination of activities;

The last period of the official accounts that was audited;

Share in the group's income;

Share in the group's assets;

Share in the group's liabilities;

The auditor's opinion on the legality of the inclusion of a subsidiary in the group of companies.

After building a group scheme, the auditor should receive answers to the following key questions in the audit of the consolidated financial statements:

Whether all subsidiaries took part in the consolidation process;

What is the exact geographic spread of the group, i.e. in which countries are the companies included in the group of companies;

What is the state of the official accounting reports - based on the reports of the auditors of subsidiaries;

What is the share of subsidiaries in the main items of financial statements.

Based on these data, the auditor can include or exclude subsidiaries from the audit program of the consolidated financial statements.

The summary results of this procedure are drawn up in the auditor's working document, which includes information about all subsidiaries.

2. Checking the accounting policies of the group of companies for consolidation purposes. To assess the principles on the basis of which the CFO was formed, and to assess the compliance of the accounting policies of the group of companies with the principles of IFRS, the auditor must get an idea of ​​the accounting policies of the audited group of companies.

The analysis of accounting policies is carried out in order to:

Establishment of discrepancies in the definition of financial reporting indicators for the accounting policy of the group of companies and IFRS;

Identification of key elements at risk;

Expressions of opinion on the applied accounting policy of the audited group of companies.

If there is a discrepancy between the principles specified in the group's accounting policy, for the purpose of consolidation, the principles of IFRS, the auditor should indicate in his working documents the discovered discrepancies and the impact of such discrepancies on the IFRS.

3. Checking the reporting of subsidiaries. At this stage, the auditor needs to obtain evidence that the preparation of separate financial statements of subsidiaries in accordance with IFRS is set at the proper level, the statements do not contain material misstatements, and are based on the accounting policy for the purpose of consolidating the group of companies. For subsidiaries selected by the auditor to conduct an audit, it is necessary to obtain assurance that:

The subsidiary prepares IFRS statements taking into account all the requirements of IFRS and the accounting policy of the group of companies for consolidation purposes;

The financial statements of the subsidiary are free of misstatements. If such statements have been audited, it is not advisable to re-audit;

To eliminate the inconsistency between the accounting policy of the subsidiary and the accounting policy for the consolidation of the group in accordance with IFRS, a set of adjusting entries is applied, which eliminates these discrepancies;

The computer information systems used in the subsidiary comply with intragroup standards, which are drawn up with the requirements of IFRS;

Management personnel have no latent interest in deliberately misrepresenting the results of IFRS financial statements in order to obtain remuneration. For example, the annual bonus for management personnel is calculated based on the results of reporting in accordance with IFRS;

Personnel preparing IFRS reporting have sufficient qualifications and knowledge in this area.

Based on his professional opinion and taking into account the specifics of the subsidiary, the auditor chooses the audit procedures that must be carried out to verify the correctness of the IFRS reporting of subsidiaries.

After completion of this stage, the auditor will form an opinion that the group of companies was formed based on the requirements of IFRS and the reporting of subsidiaries in accordance with IFRS is based on financial statements, the reliability of which has been confirmed by an independent auditor, taking into account the requirements of accounting policies for consolidation purposes in accordance with IFRS requirements.

4. Checking the process of consolidating financial statements. First of all, it is necessary to check the compliance of the eliminated indicators and the use of a single exchange rate. In practice, when preparing consolidated financial statements, one of the most common mistakes is inconsistency in the balances of intra-group transactions of subsidiaries. This error occurs especially often in cases where the group includes companies that keep records in different currencies. In the course of the consolidation process, such inconsistencies result in incomplete folding of intragroup results and misstatements in the consolidated financial statements.

After that, they check the correctness of the consolidation procedure in accordance with IFRS. At this stage, the auditor needs to obtain confidence that the consolidation procedure has been carried out in accordance with the requirements of IFRS. The main questions at this stage for the auditor will be:

Application of uniform exchange rates by all subsidiaries;

Preparation of financial statements in accordance with IFRS by subsidiaries as of a single date with consolidated financial statements;

Calculation of minority interest in accordance with IFRS requirements;

Exclusion of balances from intragroup transactions;

Absence of arithmetic errors in the item-by-item summation of the reporting indicators of subsidiaries;

Substitution of the value of the parent's investment in subsidiaries with a portion of the subsidiary's equity.

The practice of companies that prepare consolidated financial statements includes the use of various information systems for the preparation of consolidated financial statements. The tasks of such systems are to carry out consolidation based on the reporting of subsidiaries. In such systems, at the entrance to the system, there are reporting of subsidiaries in the form of specially created files, at the exit - consolidated reporting. An example of such a system is Hyperion Financial Management, Hyperion Enterprise from Hyperion Solutions. In the case of using systems created by order of a group of companies on an individual basis, the auditor needs to obtain evidence that the system is conducting the consolidation process in accordance with the requirements of IFRS. In such a case, the work of an IT expert should be used.

5. Checking the completeness of information disclosure in the explanations to the CFD. At this stage, the completeness of the disclosure of information in the notes to the consolidated financial statements is checked.

IFRS 1 defines the information contained in the notes to the financial statements as “information provided in addition to the balance sheet, income statement, statement of changes in equity and statement of cash flows. The notes provide narrative descriptions or more detailed analyzes of items disclosed in the financial statements, as well as information about those items that do not meet the criteria for recognition in the financial statements. "

Many groups of companies present, in addition to the financial statements, a financial overview for the management of the organization, which describes and explains the main characteristics of the organization's results of operations, its financial position and the main uncertainties that it faces. Such a report may provide an overview of:

The main factors and influences that determine financial results, including changes in the environment in which the organization operates, the organization's reactions to these changes and their impacts, as well as the organization's investment policy aimed at maintaining and improving financial results, including its dividend policy;

Sources of financing of the organization and its planned indicators of the ratio of liabilities and equity capital;

Those funds of the organization that are not recognized in the balance sheet in accordance with IFRS.

In the process of auditing the consolidated financial statements, the disclosure of completeness of information in the notes to the financial statements plays an important role, since each group of companies develops the forms of consolidated statements for itself on an individual basis, depending on the type of business, the structure of the group, the purposes of preparing consolidated statements in accordance with IFRS.

Often non-financial information is presented in the notes to the consolidated financial statements. The auditor, in turn, must be sure that any additional information provided by the audited entity that is not covered by the auditor's opinion is clearly and clearly separated from the audited financial statements. If the auditor concludes that any information not subject to audit does not differentiate clearly enough from the financial statements, then he should include an explanation in the auditor's report that this information was not subject to verification.

The fact that the additional information is not subject to verification does not relieve the auditor from the need to consider this information in order to identify material inconsistencies with the financial statements. The auditor's responsibilities in relation to additional information are established in ISA 720, “Other Information in Documents Containing Audited Financial Statements”.

Typical mistakes. When preparing the consolidated financial statements in accordance with IFRS, various omissions, errors, and inaccuracies are possible.

The main typical mistakes in determining the structure of a group of companies are given below.

1. Inclusion of only national subsidiaries in the group of companies.

2. Exclusion from the group of companies of subsidiaries in which the parent company does not own more than 50% of the shares, but there is clear control over the subsidiary.

3. Inclusion in the group of companies of subsidiaries in which the parent company owns more than 50% of the shares, but there is no control over the subsidiary.

4. Inclusion in the group of subsidiaries, control over which is temporary.

5. Inclusion in the group of subsidiaries that operate under strict long-term restrictions that significantly reduce control.

6. Exclusion from the group of subsidiaries due to the difference in their activities from the activities of other companies in the group.

When reporting under IFRS by companies belonging to a group of companies, the following errors are possible.

1. Accounting for property, plant and equipment does not take into account the accounting policy requirements for consolidation purposes in the area of ​​the minimum cost of property, plant and equipment, which differs from the requirements of RAS.

2. Depreciation is calculated using the same method as in RAS. Depreciation is also charged on those fixed assets that, according to IFRS, are not fixed assets.

3. When accounting for inventories, no adjustment recalculations have been made in accordance with the accounting policy for consolidation purposes.

4. When transferring business transactions to the chart of accounts according to IFRS, an incorrect transfer occurs when one account according to RAS corresponds to several accounts according to IFRS.

5. When translating transactions in foreign currency, the requirements of IFRS and accounting policies for consolidation purposes are not met.

6. When calculating reserves (for unfair debtors, for depreciation of securities, for guaranteed return of goods), the requirement of IFRS and accounting policies for consolidation purposes is not observed.

7. When calculating deferred income tax, errors arise due to incorrect determination of the components of deferred tax.

8. With regard to business transactions, the principle of their reflection in the reporting period in which they were actually carried out is not always respected. Especially for business transactions that are invoiced late.

9. In accounting for leased fixed assets, which are accounted for in the off-balance sheet accounts of the lessee in RAS, the requirements of IFRS are not taken into account.

10. In the interpretation of restricted cash means failure to comply with the IFRS requirement to record such cash in a segregated long-term asset account.

11. When carrying out transactions with securities with the terms of their repurchase - failure to comply with IFRS requirements for accounting for such transactions as transactions for obtaining a loan.

When using the principles of IFRS in the consolidation process, the errors are as follows.

1. Group companies do not summarize intra-group account balances.

2. Arithmetic errors in the item-by-item summation of the statements of subsidiaries.

3. Errors in the calculation of the minority interest due to changes in the equity of the subsidiary.

4. Errors in rolling up the book value of the parent's investment in subsidiaries and replacing it with the value of a portion of the subsidiary.

5. Inaccuracies in the KFO due to errors in the automated reporting system.

6. The notes to the CFD do not disclose events after the reporting date.

7. The notes to the CFD do not disclose the nature of the related party relationship.

8. The notes to the KFO do not fully disclose information about the group of companies.

9. The notes to the CFD do not fully disclose information about the functional currency and the reasons for reporting in a currency other than the functional currency.

Self-test questions

1. What are the main regulatory documents should be guided by the auditor when conducting an audit of the annual accounts?

2. Who should prepare and complete the reporting?

3. Who, according to the law, is responsible for the correctness of the financial statements?

4. What is the composition of the annual financial statements?

5. What requisites are required for filling in the header of the forms?

6. In what assessment should the numerical indicators of balance sheet items be presented?

7. Under what mandatory conditions can the statements of joint stock companies be submitted to the tax authorities?

8. On the basis of what documents are the reports compiled when using the journal-order form?

9. What documents are used for reporting when using the memorial order form?

10. For what types of activities are consolidated financial statements prepared?

11. What are the features of the audit of financial statements during the liquidation and reorganization of economic entities.

12. What are the peculiarities of auditing the statements of small businesses?

13. Who is covered by the simplified taxation, accounting and reporting system?

14. What are the actions of the auditor if he did not find any violations during the audit of the statements?

15. List the actions of the auditor if he found violations in the prepared reporting forms.

16. Form the audit objective in accordance with ISA.

17. Name three groups of information sources when checking the consolidated financial statements in accordance with IFRS.

18. What is the main task of auditing the structure of a group of companies?

19. How does the existence of a remuneration scheme for management personnel affect the quality of financial reporting?

20. Expand the purpose of the notes to the consolidated financial statements.

The organization is the founder of two companies in Russia. The authorized capital in one LLC is 100% and in another 70%. Features of the legislation on the submission of consolidated statements and statutory audit.

Question: Organization LLC (OSNO) has established two companies in Russia. Contributions to authorized capital these companies were: LLC # 1 - 100%, LLC # 2 - 70%. Should our "Main" company submit consolidated / consolidated statements? Or some additional reporting to reporting when applying OSNO, conduct a statutory audit?

Answer: Who should draw up the consolidated statements is spelled out in the Federal Law of July 27, 2010 No. 208-FZ. The obligation to present consolidated financial statements can only be established by law or by the constituent documents of the company. In particular, consolidated financial statements in accordance with IFRS are mandatory for credit and insurance organizations, the state corporation Rosatom, etc.

Your organization is not obliged to submit any additional reporting when applying OSNO.

In particular, a statutory audit is carried out if the organization is: a professional participant in the securities market or the organization's securities are admitted to organized trading; an insurance company; non-state pension fund (or its management company); credit institution; a public company. An audit is mandatory if: the volume of proceeds from the sale of products (goods, works, services) for the previous reporting year exceeds 400,000,000 rubles; the amount of balance sheet assets at the end of the previous reporting year exceeds 60,000,000 rubles.

A complete list of cases when it is necessary to conduct a mandatory audit is given in part 1 of article 5 of the Law of December 30, 2008 No. 307-FZ.

Justification

Who Should Prepare Consolidated IFRS Financial Statements

Some entities are required to present and publish consolidated financial statements in accordance with IFRS. This is reporting on the financial position and performance of a group of related companies (clause 2 of article 1 of the Law of July 27, 2010 No. 208-FZ). In this recommendation, you will find out which organizations and under what conditions prepare consolidated financial statements.

Important: Consolidated financial statements in accordance with IFRS do not replace regular accounting statements. An organization that generates consolidated statements is still obliged to draw up and submit financial statements in accordance with the Law of December 6, 2011 No. 402-FZ (part 2 of article 3 of the Law of July 27, 2010 No. 208-FZ).

Who is required to report under IFRS

An organization is obliged to form consolidated financial statements in accordance with IFRS if it simultaneously:

controls one or more companies. Such an organization is called a parent organization, and those controlled by it are called subsidiaries. However, there are exceptions when the parent company is not required to prepare consolidated statements for the group;

constituent documents;

own initiative.

Credit organizations

parent credit institution of the banking group;

parent organization of a bank holding company;

Insurance organizations

Consolidated financial statements in accordance with IFRS rules are compiled by insurance companies that form a group. These are parent companies.

The exception is medical insurance organizations that operate exclusively in the field of compulsory health insurance. They do not need to prepare financial statements in accordance with IFRS.

Consolidated financial statements in accordance with IFRS rules are made by NPFs, which form a group. These are parent companies.

MC IF, mutual fund, NPF

Consolidated financial statements in accordance with IFRS rules are compiled by management companies:

investment funds;

mutual investment funds;

non-state pension funds.

Important: management companies of IF, UIF and NPF are not required to prepare consolidated financial statements in accordance with IFRS of the funds themselves (information of the Ministry of Finance of Russia No. OP 6-2015, Information Notice of the Bank of Russia dated October 30, 2014).

Clearing Organizations

Consolidated financial statements according to IFRS rules are:

central counterparty;

the clearing organization that forms the group. These are parent companies.

FSUE according to the list of the Government of the Russian Federation

Joint-stock companies according to the list of the Government of the Russian Federation

Issuers

Consolidated financial statements in accordance with IFRS rules are compiled by the issuers that form the group. These are parent companies. However, under certain conditions, such parent companies may be exempted from the obligation to prepare consolidated financial statements in accordance with IFRS.

The main condition is that their securities are admitted to organized trading by being included in the quotation list. This follows from clause 8 of part 1 of article 2 of the Law of July 27, 2010 No. 208-FZ, instructions of the Bank of Russia dated September 1, 2014 No. 3374-U, Information of the Ministry of Finance of Russia dated April 17, 2015 No. OP 6-2015.

Other organizations

Consolidated financial statements according to IFRS rules are:

issuers that form a group, in the case of registration of the prospectus, admission of exchange-traded bonds or Russian depositary receipts to organized trading with the presentation of the prospectus of the said securities to the exchange. These are parent companies. If the issuer does not have organizations controlled by it, reporting under IFRS rules can be omitted (clause 4 of article 30 of the Law of April 22, 1996 No. 39-FZ, clause 2.1, article 5 of the Law of November 21, 2011 No. 325-FZ, clause 3 of Appendix 4 to the Regulation of the Bank of Russia dated October 17, 2014 No. 437-P);

state company "Russian Highways" (part 6 of article 17 of the Law of July 17, 2009 No. 145-FZ);

state corporation "Rosatom" (clause 3, part 4, article 34 of the Law of December 1, 2007 No. 317-FZ);

state corporation "Rostec" (part 6 of article 8 of the Law of November 23, 2007 No. 270-FZ);

state corporation Roscosmos (part 1 of article 35 of the Law of July 13, 2015 No. 215-FZ);

a single development institution in the housing sector (part 2 of article 2 of the Law of July 27, 2010 No. 208-FZ.

Who is exempt from KFO

For some organizations, the law made an exception, exempting them from the obligation to prepare consolidated financial statements. However, we note right away that this does not apply to credit and insurance organizations, non-state pension funds, management companies of investment funds, mutual investment funds and non-state pension funds, as well as clearing organizations (clause 3 of the order of the Ministry of Finance of Russia dated December 28, 2015 No. 217n). They cannot exercise the right to exemption from consolidated financial statements.

So, who has the right not to draw up a CFO by virtue of the Law of July 27, 2010 No. 208-FZ?

1. Public sector organizations.

2. A parent company that meets all of the following conditions:

it is itself a subsidiary. Fully or partially owned by another organization. All of its other owners, including those who otherwise do not have voting rights, have been advised that the parent will not present consolidated financial statements and do not object to this;

the parent's debt and equity instruments are not traded on the open market (on a domestic or foreign stock exchange or on an over-the-counter market, including local and regional markets);

The parent has not submitted and is not in the process of submitting its financial statements to the Securities Commission or other regulatory body for the purpose of releasing instruments of any class on the public market;

the ultimate parent or any intermediate parent of the designated parent prepares financial statements in accordance with IFRS. Reporting is available for public use. In these statements, subsidiaries are consolidated or measured at fair value through profit or loss in accordance with IFRS 10.

To determine that a subsidiary is not material, see When a subsidiary can be considered immaterial and not taken into account when consolidating financial statements under IFRS.

When to audit

In particular, a statutory audit is carried out if the organization is:

joint stock company;

a professional participant in the securities market or the organization's securities are admitted to organized trading;

an insurance company;

a non-state pension fund (or its management company);

credit institution;

a public company.

For all other organizations (with the exception of government bodies, as well as state (municipal) institutions), an audit is mandatory if, for example:

the organization provides (discloses) the consolidated accounting (financial) statements (except for the state non-budgetary fund);

the organization provides (discloses) interim consolidated financial statements;

the volume of proceeds from the sale of products (goods, works, services) for the previous reporting year exceeds 400,000,000 rubles. (except for agricultural cooperatives and their unions, as well as state (municipal) unitary enterprises);

the amount of balance sheet assets at the end of the previous reporting year exceeds 60,000,000 rubles. (except for agricultural cooperatives and their unions, as well as state (municipal) unitary enterprises);

such a duty is enshrined in other federal laws (for example, for issuers of securities, the obligation to conduct an audit is established by paragraph 9 of Article 22 of Law No. 39-FZ of April 22, 1996, and for organizers of gambling

“CCP should be used only in cases where the seller provides the buyer, including his employees, with a deferral or installment plan to pay for their goods, works, services. These cases, according to the Federal Tax Service, relate to the provision and repayment of a loan to pay for goods, works, services. If an organization issues a cash loan, receives a return of such a loan, or receives and returns a loan itself, do not use the cashier. When exactly you need to punch a check, see

Branches and divisions of an LLC are not legal entities. LLC provides accounting (financial) statements prepared in accordance with Russian accounting rules for the company as a whole. The financial statements are not prepared in accordance with IFRS and do not indicate that they are consolidated. The Charter of the LLC does not provide for the preparation, in addition to the Russian financial statements, of consolidated financial statements.
At the same time, the company does not meet the criteria for conducting a statutory audit given in Art. 5 of the Federal Law of 30.12.2008 N 307-FZ "On Auditing Activity", except for the preparation of consolidated statements.
Is the LLC obligated to conduct a statutory audit?

Having considered the issue, we came to the following conclusion:
In the analyzed situation, the LLC is not subject to mandatory audit, since the accounting (financial) statements that it compiles and presents are not consolidated.

Rationale for the conclusion:
First of all, it is necessary to find out whether the accounting (financial) statements presented by the LLC are consolidated.
According to Federal Law No. 208-FZ of July 27, 2010 "On Consolidated Financial Statements" (hereinafter - Law No. 208-FZ), the consolidated financial statements of organizations are drawn up in accordance with international financial reporting standards (IFRS).
On the territory of Russia, the standards and Interpretations of IFRS, adopted by the IFRS Foundation and recognized in the manner established by the Government of the Russian Federation, are applied. In particular, IFRS 10 "Consolidated Financial Statements" was put into effect (Ministry of Finance of Russia dated December 28, 2015 N 217n).
International Financial Reporting Standard (IFRS) 10 Consolidated Financial Statements requires an entity (parent) that controls one or more other entities (subsidiaries) to present consolidated financial statements. We see that, according to IFRS, the presentation of consolidated financial statements is provided only for groups of several independent organizations.
For the purposes of N 208-FZ, consolidated financial statements are understood as systematized information reflecting the financial position, financial results of activities and changes in the financial position of an organization, which, together with other organizations and (or) foreign organizations in accordance with International Financial Reporting Standards, is defined as a group (Law N 208-FZ). Thus, N 208-FZ, the preparation of consolidated financial statements is also provided for groups of several legal entities.
Organizations to which N 208-FZ applies are specified in Part 1 of Art. 2 of the said law. At the same time, Law No. 208-FZ determines that if federal laws provide for the preparation, and (or) presentation, and (or) publication of consolidated financial statements (consolidated financial statements, consolidated (consolidated) statements and balance sheets) or if the constituent documents an organization not specified in Law No. 208-FZ provides for the submission and (or) publication of consolidated financial statements, such statements are drawn up in accordance with No. 208-FZ.
According to Law No. 208-FZ, the consolidated financial statements of an organization are drawn up along with the accounting (financial) statements of this organization, drawn up in accordance with No. 402-ФЗ dated 06.12.2011 "On Accounting" (hereinafter - Law No. 402-ФЗ). Accordingly, the consolidated financial statements prepared in accordance with IFRS do not replace the Russian financial statements prepared in accordance with N 402-FZ.
As we understood from the clarifications to the issue, LLC does not apply to organizations named in Law No. 208-FZ. Accordingly, LLC is not required to prepare, present and publish consolidated financial statements. Since the constituent documents of the LLC do not provide for the preparation of consolidated financial statements, there is also no obligation to form them in accordance with the provisions of Law No. 208-FZ.
Currently, according to the clarifications to the issue, the LLC prepares and submits financial statements in accordance with Russian legislation and does not submit other statements. Consequently, it is impossible to call the accounting (financial) statements of an LLC compiled in accordance with Russian accounting rules "consolidated".
Thus, the LLC currently does not present consolidated financial statements, since under Russian law, as well as under IFRS, it is not obliged to do so.
Since there are no other grounds for conducting a statutory audit of the accounting (financial) statements of an LLC, the LLC is not subject to mandatory audit.

We also recommend that you familiarize yourself with the materials:
-. Mandatory audit of annual accounting (financial) statements;
- Borisov A.N. Commentary to July 27, 2010 N 208-FZ "On Consolidated Financial Statements" (second edition, revised and supplemented). - "Business yard", 2017

Prepared answer:
Expert of the Legal Consulting Service GARANT
auditor, member of the Russian Union of Auditors Bulantsov Mikhail

Answer passed quality control

The material was prepared on the basis of an individual written consultation provided within the framework of the Legal Consulting service.

In what cases the organization is obliged to conduct an audit. Mandatory audit of financial statements must be carried out by accredited organizations for the management of rights on a collective basis (copyright societies).

Question: Our organization has subsidiaries and according to the Federal Law "On Consolidated Financial Statements" dated July 27, 2010 No. 208-FZ, it must prepare consolidated statements. If an organization prepares consolidated financial statements, then it must undergo a statutory audit (the basis of clause 1 of Article 5 of Federal Law No. 208-FZ of July 27, 2010 (as amended on July 26, 2019) "On Consolidated Financial Statements"; subparagraphs 5, paragraph 1 of Article 5 of the Federal Law of 30.12.2008 N 307-FZ (as amended on 23.04.2018) "On Auditing")? Is the annual reporting of a subsidiary subject to mandatory audit if the parent company prepares consolidated statements on the basis of clause 1 of Article 5 of Federal Law No. 208-FZ of July 27, 2010 (as amended on July 26, 2019) "On Consolidated Financial Statements"? At the same time, the subsidiary does not meet the criteria of clause 1 of Article 5 of the Federal Law of December 30, 2008 N 307-FZ (as amended on April 23, 2018) "On Auditing Activity".

Answer: No, the reporting of the subsidiary is not subject to mandatory audit on the specified basis, since the subsidiary does not submit a KFO.

The obligation to conduct an audit is assigned to organizations that pass the CFD. That is, in your case, it is the parent organization, since it is she who submits the CFO. The subsidiary does not pass the KFO, therefore, it is not obliged to conduct an audit on this basis.

In this case, one should proceed from the literal wording of sub. 5 h. 1 tbsp. 5 of Law No. 307-FZ:

"…if organization (excluding organ state power, local government body, state non-budgetary fund, as well as state and municipal institutions) represents and / or discloses annual summary (consolidated) accounting (financial) statements ".

Your subsidiary does not represent or disclose the KFO.

Justification

When an organization is required to conduct an audit

Who Should Audit

All cases when it is necessary to conduct a mandatory audit are given in part 1 of article 5 of the Law of 30.12.2008 No. 307-FZ.

In particular, the statutory audit is carried out by:

Joint Stock Companies;

Professional participants in the securities market or organizations whose securities are admitted to organized trading;

Insurance companies;

Non-state pension funds or NPF management companies;

Credit organizations;

Public companies.

In addition, the statutory audit of financial statements is required to be carried out by accredited organizations for the management of rights on a collective basis (copyright societies). Organizations are obliged to publish the statements, together with the audit opinion, on their official websites no later than 10 business days following the date of receipt of the audit opinion, but no later than December 31 of the year following the reporting year. This is provided for by paragraph 6 of Article 1244 of the Civil Code.

For all other organizations, an audit is mandatory if, for example:

The organization provides (discloses) the consolidated accounting (financial) statements (except for the state non-budgetary fund);

The organization provides (discloses) interim consolidated financial statements;

The volume of proceeds from the sale of products (goods, works, services) for the previous reporting year exceeds 400,000,000 rubles. (except for agricultural cooperatives and their unions, as well as state (municipal) unitary enterprises);

The amount of assets on the balance sheet at the end of the previous reporting year exceeds 60,000,000 rubles. (except for agricultural cooperatives and their unions, as well as state (municipal) unitary enterprises);

Such a duty is enshrined in other federal laws (for example, for securities issuers, the obligation to conduct an audit is established by paragraph 9 of Article 22 of the Law of April 22, 1996 No. 39-FZ, and for gambling organizers, by part 12 of Article 6 of the Law No. 244-FZ of December 29, 2006) ...

A complete list of cases of mandatory audit of accounting for 2018 with an indication of the type of audited reporting and possible auditors is given in