Financial investments are expenses of the organization intended for the purchase of securities (bonds, shares, checks and others), investment in joint activities and in the authorized funds of any other organizations, as well as the provision of loans to organizations under bills or other debt obligations. Accounting for financial investments, regardless of their type, is regulated by the General Accounting Regulation.
There is no single and unambiguous classification of all financial contributions, but nevertheless, they are nevertheless divided according to some of the following criteria:
1. In accordance with the economic essence there are:
- debt investments (checks, bonds, loans, bills) ;
- equity (contributions to the authorized capital, shares);
- derivatives (bills of lading, warrants, options, forward and futures contracts);
2. By the term of his appeal:
- short-term (less than a year);
- long-term (more than a year).
3. The following may be issued by the issuer:
- government bodies;
- by individuals;
- legal entities;
- municipal authority.
In order for accounting of financial investments to be carried out, three conditions must be fulfilled simultaneously:
- the presence of documents that are duly executed and confirm the ownership of the organization;
- the transition of all financial risks to the organization;
- the ability of financial investments to be economically beneficial to the organization.
Keeping records of financial investments, you can not make mistakes. So, for example, you need to know that they do not apply to them at all:
- own shares that were repurchased from shareholders for the purpose of cancellation or for further sale;
- investments in real estate, as well as in movable property, which have a tangible form and are provided by the organization for use for some time for some payment;
- bills issued in the calculations for work performed, products sold or goods;
- jewelry, various works of art, precious metals and other valuables of a similar nature, which were acquired not for the ordinary course of business.
Accounting for financial investments must be extremely accurate and ensure the fulfillment of such tasks:
- Reliable display of cost at their disposal or acquisition.
- Timely reflection of acquisition or disposal operations, correct documentation.
- Timely revaluation.
- Control over the safety of all financial investments that have been accepted for accounting.
- Control over the formation and use of reserves for depreciation.
- Proper accrual of income from operations related to financial investment.
- Correctness of taxation related to financial investment operations.
- Formation in the financial statements of information on their availability and movement.
- An inventory to identify shortages or surpluses.
When financial investments are recorded, transaction transactions are reflected in 58 accounts. He is active and has his subaccounts:
- Short-term financial investments in securities.
- Short-term loans granted.
It must be said that accounting for financial investments is mandatory at their initial cost. Moreover, the order of its formation directly depends on how they are received. Thus, their initial cost consists of several values at once, namely: the cost of acquiring financial investments, consultations and information services, the amount of commission fees and other costs that are somehow related to investments.