What Kind of Financial Reporting Standards do Russian Companies Use?

The world is seemingly moving towards International Financial Reporting Standards (IFRS). The European Union (EU) has adopted them as of 1 January 2005. New EU entrants must adopt them as a condition of the EU membership. USAID, TACIS, the World Bank and other organizations have been subsidizing the spread of IFRS by offering training and translation assistance.

IFRS is spreading throughout the former Soviet Union as well. All 15 former Soviet republics are in some stage of adopting IFRS, either officially or unofficially. Even if there is resistance at the governmental level, the market recognizes the value of financial statements prepared using a set of accounting standards that are internationally known and respected (McGee and Preobragenskaya 2005, 2006). The present study attempts to determine the penetration of IFRS among large Russian corporations.