Correction of significant accounting errors

What is a material accounting error?

The main regulatory act regulating the procedure for correcting errors in accounting is PBU 22/2010 “Correcting errors in accounting and reporting” (approved by Order of the Ministry of Finance dated October 28, 2010 No. 63n).
According to PBU, an error cannot be an inaccuracy in accounting or reporting that arises due to the appearance of information after the fact of economic activity has been entered into accounting. PBU 22/2010 divides accounting errors into significant and insignificant. A significant error is one that, by itself or in combination with other errors for the reporting period, can affect the economic decisions of users made on the basis of accounting records for this reporting period.

The legislation does not establish a fixed amount of a significant error - the taxpayer must identify it independently in absolute or percentage terms. The level of materiality above which an error is considered significant must be indicated in the accounting policy.

Officials in some regulations recommend setting the level of materiality equal to 5% of the indicator of a reporting item or the total amount of an asset or liability (clause 1 of Order of the Ministry of Finance dated May 11, 2010 No. 41n, clause 88 of Order of the Ministry of Finance dated December 28, 2001 No. 119n). We propose to establish simultaneously both an absolute and a relative indicator for determining a significant error. The firm can set the absolute indicator at any size.

Example of an accounting policy statement:

An error is considered significant if the amount of distortions exceeds ... thousand rubles. or the magnitude of the error is 5% of the total amount of the asset (liability), the value of the financial reporting indicator.

Read about what you need to be guided by when drawing up your accounting policies in the material “PBU 1/2008 “Accounting Policies of an Organization” (nuances).”

If an individual error is not significant, according to the established criterion, but there are many similar errors in the reporting period - for example, an accountant incorrectly takes into account personal protective equipment - then these errors must be considered in their entirety, since in total they can be considered significant.

For significant errors in accounting, separate correction rules have been established.

Correction of minor errors in BU

Accounting (financial) statements must be approved no later than:

• April 30 - for LLC (clause 6, clause 2, article 33, article 34 of the Federal Law of 02/08/1998 N 14-FZ);
• June 30 - for JSC (clause 1 of article 47, clause 11 of clause 1 of article 48 of the Federal Law of December 26, 1995 N 208-FZ).

A minor error is corrected in correspondence with account 91 “Other income and expenses”.

Organizations that have the right to use simplified methods of maintaining accounting (including drawing up a simplified accounting) can correct a significant error in correspondence with account 91, without retrospective recalculation (clause 9 of PBU 22/2010).

Correcting errors in accounting documentation

The algorithm for correcting inaccuracies in accounting depends on where the error was made - in the primary records and registers or in the reporting itself, the timing of the error detection and whether it is significant.

There are the following correction methods in the primary and registers:

• Proofreading - used in paper documents; incorrect information is crossed out so that the original information can be read, and the correct entry is made next to it. The correction must be certified by the full name and signature of the responsible person, the date and seal of the company (Clause 7, Article 9 of the Law “On Accounting” dated December 6, 2011 No. 402-FZ).

ATTENTION! There are a number of documents in which corrections are unacceptable. These include cash and bank documents.

• “Red reversal” - used in case of incorrect posting of accounts. When entering by hand, the erroneous entry is repeated in red ink, and the amounts highlighted in red must be subtracted when calculating the totals. As a result, the incorrect entry is canceled, and instead a new entry must be made with the correct accounts and amount. If accounting is kept in a standard computer program, then it is usually enough to make a posting with the same correspondence, but indicate the amount with a minus sign. The entry in the registers will be subtracted and offset the incorrect entry. Next you need to make the right one.
• Additional entry - used if the original correspondence of accounts was correct, but with the wrong amount, or if the transaction was not recorded on time. The company makes an additional entry for the missing amount, and if the original amount was overestimated, it makes an entry for the required difference using a red reversal. The accountant is also required to draw up a certificate explaining the reason for the correction.

For information on how to draw up such a certificate, read the article “Accounting certificate of error correction - sample.”

Correcting mistakes of past years: what's new in 2021?

26.12.2020

From 01/01/2021, new budget accounting accounts are being introduced to isolate transactions that are related to the correction of errors of previous years identified in the reporting period. What are these bills? What is the procedure for using them? How to reflect corrections in budget accounting and budget reporting?

An error is an omission and (or) distortion that arose during accounting and (or) preparation of reporting as a result of incorrect use or non-use of information about the facts of economic life of the reporting period, which was available on the date of signing the reporting and should have been received and used in its preparation ( clause 27 of the GHS “Accounting Policies”

).

Depending on the period in which the errors were made, they are divided:

1) for errors in the reporting period

– errors identified in the period (in the year) for which the institution did not generate budget reporting (interim or annual), or in the period for which the annual budget reporting was generated but not approved (measures are being taken for desk audit of annual reporting, internal financial control , external financial control, as well as internal control or internal financial audit);

2) on the mistakes of past years

– errors made in the period for which the annual budget reporting was approved (external financial control measures were completed).

From 01/01/2021, when correcting errors made when maintaining budget accounting in previous reporting periods, you must adhere to the new rules. Let's look at them in detail.

Accounts used to correct errors from previous years

According to the provisions of updated instructions No. 157n

,
162n
(as amended by
orders of the Ministry of Finance of the Russian Federation dated September 14, 2020 No. 198n
,
dated October 28, 2020 No. 246n,
respectively) the procedure for reflecting in budget accounting operations to correct errors of previous years depends on:

– who identified the errors (authorized control bodies or other persons); – in what year the errors were made (in the past or earlier than the past); – whether the correction requires adjustment of financial performance indicators (income and expenses) of previous years or not.

If errors are identified during control activities

bodies authorized to draw up protocols on administrative offenses for violation of budget accounting requirements, including the preparation and presentation of budget reporting, then the following accounts are used to correct them:

If errors are discovered by others

, including employees of institutions, the following accounts are used:

Note:

accounts used before 01/01/2021 to correct errors of previous years in terms of consolidated calculations (
1,304,84,000
“Consolidated calculations of the year preceding the reporting year”,
1,304,94,000
“Consolidated calculations of other previous years”), are excluded from the chart of accounts of budget accounting and Instructions No. 162n.

Reflection of corrections in budget accounting

Corrections to last year's errors in budget accounting should be reflected in the manner established by the provisions of clause 18 of Instruction No. 157n

,
GHS “Accounting Policy”
, as well as taking into account the norms of Instruction No. 162n.
You can also use the Methodological recommendations for the application of the GHS “Accounting Policies”
, communicated by
the Letter of the Ministry of Finance of the Russian Federation dated 08/31/2018 No. 02-06-07/62480
(hereinafter referred to as the Methodological Recommendations), insofar as they do not contradict the provisions of the updated instructions No. 157n, 162n.

Errors from previous years discovered in the accounting registers are corrected by issuing an additional accounting entry or an accounting entry using the “red reversal” method and an additional accounting entry using the corresponding budget accounting accounts during the period (as of the date) the error was discovered and a retrospective recalculation of budget reporting ( clause 18 Instructions No. 157n

,
paragraph 17 of the Methodological Recommendations
).

Depending on the nature of the error, we suggest using the following methods for correcting and filing it:

* The accounting certificate (f. 0504833) indicates information on the rationale for making corrections, the name of the accounting register being corrected, its number (if any), as well as the period for which it was compiled and the period in which errors were identified.

Accounting records for correcting errors of previous years are subject to separation in a separate journal of operations for correcting errors of previous years (form 0504071) ( clause 18 of Instruction No. 157n

). Entries in this journal are made on the basis of transactions reflected in accounts intended to correct errors of previous years, documented in an accounting certificate (f. 0504833).

For your information:

Errors in electronic registers are corrected by the persons responsible for their maintenance. Corrections not authorized by those responsible for compiling accounting registers cannot be made.

Turnovers from transactions reflected in the journal of transactions for correcting errors of previous years (f. 0504071) are transferred to the general ledger (f. 0504072) at the time an error is detected and corrective entries are made.

At the end of the year, the indicators of budget accounting accounts for reflecting errors of previous years must be closed on account 0 401 30 000

“Financial result of previous reporting periods.” These operations are recorded in the log of operations to correct errors of previous years (f. 0504071).

Let us support all of the above with examples from practice.

Example 1.

During an audit of the financial and economic activities of a state-owned institution, regulatory authorities discovered an error made in 2020 (last reporting period): expenses for routine repairs of equipment in the amount of 20,000 rubles. erroneously attributed to an increase in its value, although they should have been attributed to the financial result of the current year (account 1,401,20,225). For this violation, an order has been drawn up to eliminate it.

The following erroneous entries were made in accounting:

1. An increase in the cost of equipment in the amount of 20,000 rubles is reflected:

– by debit of account 1 106 31 310 and credit of account 1 302 25 734; – by debit of account 1 101 34 310 and credit of account 1 106 31 310.

2. Depreciation was accrued (from the amount increasing the cost of the equipment) in the amount of 1,000 rubles. on the debit of the account 1 401 20 271 and the credit of the account 1 104 34 411.

The following corrective entries will be made in budget accounting:

Example 2.

After submitting and approving the annual budget reports, the accountant of a government institution identified an error made in December 2021: blinds were taken into account as part of inventories (account 1,105,36,000), and not as part of fixed assets (account 1,101,38,000). The cost of blinds is 60,000 rubles.

The following corrective entries will be made in budget accounting:

Reflection of corrections in budget reporting

According to paragraph 17 of the Methodological Recommendations

an error from previous years is corrected depending on the period of its discovery (factors that revealed such an error) by decision of the accounting entity or an authorized person with the formation of updated budget reporting containing a retrospective recalculation.

For your information:

A retrospective restatement of financial statements is the correction of an error of the previous year (years) by adjusting the comparative indicators of the budget statements for the previous year (years) in such a way as if the error had not been made.

Restatement of comparative figures should begin from the year in which the error was made, unless such an adjustment is not possible. Let us recall that a retrospective recalculation of financial statements is not possible if the consequences of such recalculation are assessed in monetary terms (value terms) ( clause 19

,
33 GHS “Accounting Policies”
):

– impossible due to insufficient (lack of) information for the corresponding previous year; – requires the use of estimates based on information that was not available at the reporting date for the prior year.

At the same time, there is no need to correct the approved statements for previous years. Adjusted comparative indicators of the previous year (years) are presented in the financial statements of the reporting year separately from the reporting period.

Comparative indicators disclosed in budget reporting include, in particular ( clause 17 of the Methodological Recommendations

):

– indicators at the beginning of the reporting period (beginning of the year preceding the reporting period (year)); – indicators at the end of the reporting period (month, quarter, half-year, 9 months) of the year preceding the reporting period (year); – turnover by indicators for the reporting period of the year preceding the reporting period (year).

Information on correcting errors of previous years is reflected in information on changes in balance sheet currency balances (form 0503173) ( clause 170 of Instruction No. 191n

):

– in column 6 by reason code 03 – when correcting errors of previous years in terms of maintaining budget accounting; - in column 10 by reason code 07 - when correcting errors of previous years in terms of maintaining budget accounting, identified as a result of external (internal) state (municipal) financial control.

The information is filled out on the basis of the turnover for correcting errors of previous years, reflected in the log of operations for correcting errors of previous years (f. 0504071).

Indicators of debit (credit) turnover for correcting errors of previous years on accounts that, in accordance with the rules of budget (accounting) accounting, are subject to closure at the end of the year for the financial result of previous reporting periods ( account 0 401 30 000

), are reflected in columns 6, 10 of line 570 “Financial result of an economic entity” of the specified information.

Budget reporting indicators at the beginning of the reporting period (in any reporting format) are reflected taking into account their adjustments based on corrective entries in terms of identified errors from previous years. Incoming balances are adjusted according to the line “Financial result of previous reporting periods”, as well as according to lines reflecting the values ​​of reporting items adjusted as a result of correcting errors of previous years.

Based on this information (form 0503173), the adjusted opening balances (at the beginning of the reporting year) of the balance sheet (form 0503130) are reflected. Its indicators at the beginning of the year after the changes must differ from the indicators at the beginning of the reporting year reflected in the general ledger (form 0504072) for the reporting year by the amount of adjustments (corrections) for errors of previous years. In this case, the indicators (balances) at the end of the reporting year of the general ledger (f. 0504072) for the reporting year and the balance sheet for the reporting year must match.

In the event that an error was made earlier than the previous year for which comparative indicators are disclosed in the statements, the opening balances under the item “Financial result of an economic entity” of the balance sheet (form 0503130), as well as the values ​​of related reporting items for the earliest previous year, are subject to adjustment. for which comparative figures are disclosed in the financial statements.

If it is not possible to unambiguously attribute the amounts of adjustments to a specific previous year, the opening balances under the item “Financial result of an economic entity” of the balance sheet (form 0503130), as well as the values ​​of related reporting items for the earliest previous year to which such adjustments can be applied, are reviewed. or at the beginning of the reporting year ( clause 33 of the GHS “Accounting Policies”

).

Please note that indicators of changes (turnovers by increase, decrease) of assets, liabilities, income, expenses that influenced changes in opening balance sheet indicators (columns 6, 10 information (form 0503173)) as a result of correcting errors of previous years) are not included in the indicators increases, decreases (turnovers) of assets, liabilities, income, expenses reflected in budget forms for the reporting period ( clause 170 of Instruction No. 191n

).

Additionally, regarding errors of previous years in the text part of the explanatory note (f. 0503160) in section. 5 or in the accompanying document containing explanations for budget reporting, when submitting reports the following information is reflected ( clause 34 of the GHS “Accounting Policies”

,
paragraph 21 of the Methodological Recommendations
):

– description of the error; – the amount of adjustment for each reporting item for each of the previous years for which comparative indicators are disclosed; – the total amount of the adjustment at the beginning of the earliest preceding year for which comparative figures are disclosed in the financial statements; – a description of the reasons why it is not possible to adjust the comparative statements for one or more prior years, as well as a description of how the correction of the error will be reflected, indicating the period in which the corrections are reflected.

* * *

From 2021, errors made during the period for which the annual budget reporting was approved (external financial control measures were completed) are corrected using the following accounts:

– 0 304 66 000

,
0 304 76 000
,
0 401 16 000
,
000
,
0 401 26 000
,
0 401 27 000
– if they are identified by authorized bodies during control activities;
– 0 304 86 000
,
0 304 96 000
,
0 401 18 000
,
0 401 19 000
,
0 401 28 000
,
0 401 29 000
– when they are discovered by other persons.

Corrections are made by an additional accounting entry or an accounting entry using the “red reversal” method and an additional accounting entry using the specified budget accounting accounts during the period (as of the date) the error was discovered and the retrospective recalculation of budget reporting.

Accounts used until 2021 to correct errors of previous years in terms of consolidated calculations ( accounts 1,304 84,000

,
1 304 94 000
), excluded from the chart of accounts of budget accounting and Instruction No. 162n.

Mishanina M., expert of the information and reference system "Ayudar Info"

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Ways to correct errors in accounting for 2020

The order of corrections depends on the significance of the error and the period of detection:

• Errors from 2021 that were identified before the end of 2021 will be corrected in the month in which they were identified.
• An insignificant error made in 2021, but identified in 2020, after approval of the statements for 2021, is corrected by entries in the relevant accounting accounts in the month of 2021 in which the error was identified; profit or loss resulting from correction of an error is attributed to account 91.
• The 2021 error, which was discovered in 2021, but before the date of signing the accounting statements for 2021, is corrected by making an entry in the accounting transactions for December 2021. Significant accounting errors that were discovered after the signing of the financial statements for 2021, but before the date of their submission to the government agency or owners (shareholders), are similarly corrected.
• If the error for 2021 is significant, and the reporting for 2021 has already been signed and provided to the owners (shareholders) and government agencies, but has not been approved, we correct it with accounts that will be dated December 2021. At the same time, in the new version of the accounting statements, it is necessary to indicate that these statements replace the originally provided ones and indicate the reasons for the replacement.

ATTENTION! New reporting must be submitted to all recipients to whom the previous uncorrected reporting was submitted.

• A significant error for 2021 was identified after the accounting statements for 2021 were approved - we are correcting them with entries in the accounting accounts already in 2021. Account 84 will be used in the postings.

Example:

The accountant of Perspektiva LLC discovered in May 2021 that he had not reflected rent in the amount of 100,000 rubles in the transactions for 2021. This is a significant error in accordance with the accounting policy of Perspektiva LLC, and it was identified after the approval of the financial statements for 2021. The accountant will make the following entries:

Dt 84 Kt 76 in the amount of 100,000 rubles. — erroneously not reflected expenses for 2021 were identified.

In addition, Perspektiva LLC must submit an income tax update for 2021.

Also, when correcting a significant error discovered after the approval of the annual statements, it is necessary to perform a retrospective recalculation of the financial statements - this is a procedure for bringing the reporting indicators into the appropriate form as if the error had not been made. For example, if, after a retrospective recalculation of data, the profit indicator for 2021 decreased from 200,000 rubles. up to 100,000 rubles, then in the 2021 reports in the comparative data columns for 2021, it is no longer necessary to indicate 200,000 rubles. (according to the approved report), and 100,000 rubles. (by correction). Companies that use simplified accounting methods are not allowed to do this procedure.

For information about what kind of reporting companies submit using a simplified method of accounting, read the material “Simplified accounting financial statements - KND 0710096”.

Information about identified significant errors from previous years that were corrected in the reporting period must be indicated in the explanatory note to the annual accounting reports. The legal entity must indicate the nature of the error, the amount of adjustment for each reporting item and the adjustment to the opening balance. If the organization provides information on earnings per 1 share, then the explanatory note also indicates the amount of adjustment based on data on basic and diluted earnings per 1 share.

What other information needs to be indicated in the explanatory note is described in the article “We are preparing an explanatory note for the balance sheet (sample)” .

In accordance with the letter of the Ministry of Finance dated January 22, 2016 No. 07-01-09/2235, the organization has the right to independently develop an algorithm for correcting errors in accounting and reporting based on current legislation. We recommend that you consolidate the chosen procedure in the accounting policy.

Procedure for correcting errors before approval...

Errors identified by the organization and their consequences are subject to mandatory correction (clause 4 of PBU 22/2010). The procedure for correcting an error depends on the moment at which it was detected . If an error is identified in the current year, it is corrected by making entries in the appropriate accounting accounts. Corrective entries must be made in the month the error was discovered (clause 5 of PBU 22/2010). If an error is identified at the end of the reporting year, but before the date of signing the financial statements for this year, it is corrected by making corrective entries in the relevant accounting accounts for December of the reporting year for which the annual financial statements are prepared (clause 6 of PBU 22/2010) .

Example. In January 2010, distribution costs did not include rent paid in advance for office space worth RUB 2 million. 1. The error was discovered in May 2010. It is necessary to make adjustments to the accounting records for May. This error should be corrected in the month it was discovered, if the year has not yet ended. 2. The error was discovered in January 2011 when reconciling settlements with the counterparty. 2010 has already ended, but reporting for it has not yet been submitted. Corrective entries are made on December 31, 2010.

If an error from a previous year is identified after the date of signing the financial statements for this year, its significance should be assessed. A minor error is corrected in the current year by making corrective entries in the relevant accounting accounts. Corrections are made in the month of its detection (clause 14 of PBU 22/2010). Profit or loss arising as a result of correcting this error is reflected as part of other income or expenses of the current reporting period. A significant error of the previous reporting year, identified after the signing of the financial statements, but before the date of submission of these statements to its owners, is corrected by making corrective entries in the relevant accounting accounts in December of the previous year (clauses 6 and 7 of PBU 22/2010). In this case, owners are understood as shareholders of a joint-stock company, participants in a limited liability company, a government body, a local government body or another body authorized to exercise the rights of the owner. Additionally, clause 7 of the PBU under consideration introduces the following rule: if, before presentation to the owners of the organization, the financial statements were presented to other external users, they are subject to replacement with amended statements and are called “revised financial statements.” Repeated submission of annual reports occurs quite often in practice. Annual reports for the previous year are submitted to tax authorities and statistics authorities at the end of March. At this point, most often it has not yet been approved, especially in joint-stock companies, and has not been verified by auditors. After an audit report is issued, organizations are often forced to change their financial statements. The revised financial statements must have a different date of signing by the responsible persons. Actually, the auditor in the audit report on the revised financial statements should draw the attention of its users to this fact.

Example. Joint stock company, in accordance with paragraphs. 5 p. 1 art. 23 of the Tax Code of the Russian Federation, submitted financial statements to the tax authority on March 30. Federal Law No. 208-FZ of December 26, 1995 “On Joint-Stock Companies” stipulates that the annual general meeting of shareholders is held within the time limits established by the company’s charter, but no earlier than two months and no later than six months after the end of the financial year. Thus, the annual general meeting of shareholders can be held from March 1 to June 30 of the year following the reporting year. The annual general meeting of shareholders of the company is scheduled for May 25. In April, an audit of the prepared statements was carried out and significant errors were identified, which were corrected by making additional entries in December of the reporting year. Based on the results of the corrections, the financial statements were revised and re-signed. The corrected statements must be resubmitted to the tax authority.

The Russian Ministry of Finance calls December the period for correcting a significant last year error identified before the date of approval of the reporting for this period. In practice, corrections are made by entries dated December 31 of the previous year. Clause 8 of PBU 22/2010 describes an algorithm of behavior for a situation where reporting with significant errors, but not yet approved, was presented to the owners. In this case, corrections are made by entries for December of the year for which the annual financial statements are prepared for approval, i.e. it is revised and resubmitted to the owners for approval. The restated financial statements disclose the replacement of the financial statements as originally presented and the basis for their preparation. The revised reporting (including accounting) is presented to all addresses, to all users to whom the original one was submitted.

Correcting errors in tax accounting

If the provisions of PBU 22/2010 are relevant for legal entities, since the self-employed population is not required to keep accounting records, then the procedure for correcting errors in tax accounting applies to both entrepreneurs and organizations.

According to Art. 314 of the Tax Code of the Russian Federation, errors in tax registers must be corrected using a corrective method: there must be a signature of the person who corrected the register, the date and justification for the correction.

The procedure for correcting errors in tax accounting is described in detail in Art. 54 Tax Code of the Russian Federation.

If an error in calculating the tax base for previous years was discovered in the current reporting period, then it is necessary to recalculate the tax base and the amount of tax for the period the error was committed.

If it is impossible to determine the period of the error, then the recalculation is made in the reporting period in which the error was found.

Errors in tax accounting, as a result of which the tax base was underestimated, and therefore the tax was underpaid to the budget, must not only be corrected, but also an update provided to the Federal Tax Service for the period the error was committed (Article 81 of the Tax Code of the Russian Federation). However, if an error is discovered during a tax audit, then there is no need to submit an amendment. In this case, the amount of arrears or overpayments will be recorded in the audit materials, and the tax authorities will enter this data into the company’s personal account card. If the company submits a clarification to the tax authority, the data on the card will be doubled.

If at the end of the year there is a dispute with the Federal Tax Service and there is a high probability of additional taxes (penalties), then an estimated liability must be recognized in the accounting reports. Read more about this in the material “Tax dispute = estimated liability”.

In the case where a company overpaid tax due to its own error, it may submit an amendment or not correct the error (for example, the amount of overpayment is insignificant). Another option that a company can use is to reduce the tax base in the period the error is discovered by the amount of overstatement of the tax base in the previous period. This can be done when calculating transport tax, mineral extraction tax, simplified tax system and income tax.

ATTENTION! This method cannot be used when identifying errors in VAT calculations, since inflated VAT can only be corrected by submitting an amendment for the period the error was committed.

If a company operated at a loss and identified an error in the previous period that would increase the loss, then these expenses cannot be included in the tax calculation for the current period. The company should submit an update with new amounts of expenses and losses (letter of the Ministry of Finance dated April 23, 2010 No. 03-02-07/1-188).

ConsultantPlus experts explained in detail what to do if errors are identified in primary documents. Get trial access to the K+ system and go to the Tax Guide for free.

"Consumable" errors

Errors from which it is not the budget that suffers, but the taxpayer, are called “expenses”: this is the failure to take into account expenses, deductions, etc. Depending on the situation, such an error may lead to an actual overpayment of tax to the budget or to an underestimation of the amount of the loss.

As a general rule, “expenses” errors in tax accounting must be corrected in the period to which they relate (Clause 1 of Article of the Tax Code of the Russian Federation). However, in two cases they can be corrected in the current period.

We are already familiar with the first case: these are situations when it is impossible to determine from the documents the period to which the error relates. In terms of expenses, this exception cannot be applied, because the primary report must contain the date (Clause 2, Clause 2, Article 9 of Federal Law No. 402-FZ of December 6, 2011).

If it is impossible to determine the period of error, it means that the documents were drawn up incorrectly, and expenses cannot be taken into account (clause 49 of Article 270 of the Tax Code of the Russian Federation).

But the second case concerns expenses. It is believed that if errors from previous periods led to excessive payment of tax, then recalculation can be made in the same tax period when they were identified. It would seem that this provision opens up the possibility of accounting for any “expenses” errors without filing updated declarations. But actually it is not.

Firstly, only those who actually paid tax to the budget in the “erroneous” period can exercise the right to take into account the errors of past years in the current period (Article of the Tax Code of the Russian Federation).

A new accountant, Sergei, has appeared in the construction industry. While preparing reports for 2021, he discovered an error that dates back to July 2021, but in the third quarter of this year the amount of income was equal to the amount of expenses, so no advance was paid to the budget. This means that Sergey cannot take into account the expenses of July 2018 in December 2021, so he will have to submit clarifications and edit the tax base for 2021 (letter of the Ministry of Finance of Russia dated February 16, 2018 No. 03-02-07/1/9766).

Secondly, correcting an error in the current period is a type of offset of overpaid tax, when an overpayment in one year is offset by an underpayment in another. And such an operation is possible only within three years from the moment of the error (clauses 3 and 7 of Art. Tax Code of the Russian Federation, Ruling of the Supreme Court of the Russian Federation dated January 21, 2019 No. 308-KG18-14911 in case No. A32-37022/2017).

In other words, accountant Sergey can easily include expenses for 2021 and 2021 in the declaration for 2021. Expenses for 2016 are already at risk, because for each of them you need to look at the accounting rules (Articles 272, 273 or 346.16–346.17 of the Tax Code of the Russian Federation) to determine the date for counting the three-year period. And expenses of earlier periods will no longer be included in the declaration for 2021.

Thirdly, you need to remember that when correcting “expenses” errors related to VAT, apply the rules of paragraph 1 of Art. The Tax Code of the Russian Federation will not work. The fact is that the tax base for VAT is formed on the basis of the purchase book and sales book, and the rules for their maintenance are approved by Decree of the Government of the Russian Federation of December 26, 2011 No. 1137. This resolution, in principle, does not provide that the tax base of the current period can be reduced by excessive amounts. VAT amounts calculated in previous periods.

In terms of VAT in the current period, only “expenditure” errors associated with non-application or incomplete application of deductions can be corrected.

But all other errors, for example, overestimating the volume of work or revenue, will have to be corrected using clarifications for the corresponding periods.

When there really is no error

Before deciding how to correct a “consumable” error, you need to make sure that it was actually made.
This is especially true for cases of non-accounting for rental payments, fees for communication services, legal, information, consulting, auditing and other services and works due to the fact that the primary documents for them were received after the “closing” of the period. Regarding expenses for payment for work and services, the Tax Code of the Russian Federation gives the taxpayer the right to determine which day will be considered the date of recognition of the expense for profit tax purposes. These expenses can, at the choice of the taxpayer, be taken into account either on the date of calculations specified in the agreement, or on the last day of the period, or on the date of presentation to the taxpayer of documents serving as the basis for making calculations (clause 3, paragraph 7, article 272 of the Tax Code of the Russian Federation, determination of the Supreme Arbitration Court of the Russian Federation dated July 13, 2012 No. VAS-9033/12, resolution of the Federal Antimonopoly Service of the West Siberian District dated June 4, 2007 No. F04-3586/2007(34911-A27-26) in case No. A27-15398/2006-6 and the Moscow District dated February 15. 2012 in case No. A40-44297/11-91-190).

If the last option is fixed in the accounting policy, then failure to account for an expense in the period to which the document relates will not be an error: until the document has been received, there cannot be an expense itself. An expense can rightfully be included in the current base without regard to the results of previous periods and the time that has passed since the date of provision of the service or completion of the work.

However, you will need to document the date of receipt of the document. To do this, you need to save postal envelopes, as well as keep logs of received correspondence and registration of documents received by the accounting department, reflect the date of receipt of documents for payment of rent, utilities and other works and services.

If the accounting policy does not specify the moment of recognition of such expenses, then they must be reflected at the earliest of the dates specified in paragraphs. 3 paragraph 7 art. 272 of the Tax Code of the Russian Federation (letter of the Ministry of Finance of Russia dated June 28, 2012 No. 03-03-06/1/328).

Fines for accounting errors

Errors in accounting and reporting can result in a fine for the company. Moreover, from April 10, 2016, the amount of fines for incorrect record keeping increased - with the entry into force of Law No. 77-FZ dated March 30, 2016.

Art. 15.11 of the Code of Administrative Offenses in the new edition contains the following list of violations and penalties for them:

Thus, officials have expanded the list of violations in accounting and reporting for which they will henceforth be fined, and have increased the sanctions, as well as the period during which the company can be punished.

Adjustment of financial statements

In the process of preparing financial statements, various types of errors cannot be ruled out. There are certain rules for correcting them.

The most common causes of errors are:

• incorrect interpretation of Russian legislation on accounting and reporting;
• improper application of the organization's accounting policies;
• inattention or lack of certain knowledge among accounting specialists;
• allowing for inaccuracies in calculations;
• incorrect classification or assessment of the facts of the organization’s economic activities;
• failure to comply with deadlines for submitting primary documents to the organization’s accounting department by business partners or employees of the organization itself.

If errors are identified, it is necessary to analyze them, because they require a mandatory division into significant and non-essential. This is very important, because the procedure for making adjustments to accounting and financial reporting depends on it. Thus, an error is considered significant if it can affect the economic decisions of both external and internal users. After all, accounting reporting is a kind of foundation for making appropriate decisions. In this case, the threshold of materiality is set by the organization independently, which is one of the elements of its accounting policy.

Error correction procedure

There are certain rules for correcting errors in financial statements. These rules are set out in the Accounting Regulations, which are called “Correcting Errors in Accounting and Reporting” (PBU 22/2010, approved by Order of the Ministry of Finance of the Russian Federation dated June 28, 2010 No. 63n). This Regulation is mandatory for use by all legal entities, including organizations using the simplified tax system, except for credit and budget ones.

According to the current methodology, the procedure for correcting errors in financial statements depends not only on the level of their significance, but also on the time period in which they were discovered. Let us recall that an error is considered significant if, on its own or in combination with other errors, it can affect the economic decisions of both external and internal users made on the basis of the financial statements compiled for this period. At the same time, we note that financial statements already submitted to the tax authority and the statistics department can be clarified and submitted again in a corrected form. This opportunity is provided by the above-mentioned standard, which introduces the concept of “revised financial statements”.

Adjustment of financial statements

So, in general, one should focus on the determining factor in such an adjustment of the financial statements, which is not its submission to the tax authority, but approval by the owners. This means that the procedure for making adjustments to the financial statements depends on the time period in which a significant error was identified in the previous reporting period. In order to make the right decision on adjusting the financial statements, we recommend that you refer to the above-mentioned PBU 22/2010, since this document presents a classification of errors depending on the period of their detection.

Having familiarized ourselves with this classification, we see that if a significant error made in the financial statements of the previous year was identified after the date of its signing by the head of the organization, but before the date of its presentation to the owners, then it is corrected in the relevant accounting accounts, and this correction is dated December of the year, for which these reports were prepared. If the financial statements, which contain identified significant errors, have already been submitted to the tax office and the statistics department, then they must be replaced.

In this case, the algorithm for the accountant’s actions when correcting errors made in the accounting and reporting of the previous year, according to PBU 22/2010, may be as follows:

• in the period when errors are discovered, adjustment entries should be made and dated to December of the reporting year;
• create a new annual balance sheet;
• prepare a new calculation of the financial result;
• submit revised (new) financial statements to the tax authority and statistics department in place of the original one. If necessary, an explanatory note should also be submitted.

If significant errors in the financial statements of the previous reporting year are identified after they were submitted not only to the tax authority, statistics, but also to the owners, but they have not yet approved them, then in this case the actions of the accountant are similar. In addition, the accountant’s responsibility is to send new financial statements to all users, incl. and the owners to whom the original financial statements were presented. At the same time, it is also necessary to provide explanations to the adjusted financial statements as an appendix, which indicate that these financial statements replace the originally presented ones and indicate the reasons for the adjustment.

A situation may also arise in which significant errors from the previous reporting year are also identified in the next year, but after their approval by the owners of the company. In this case, the annual financial statements presented to both external and internal users are not subject to adjustment, replacement or re-submission in accordance with clause 10 of PBU 22/2010.

This means that in this case, a significant error discovered in the annual financial statements for the previous year is corrected in the current period of its discovery. In this case, income and expenses that are subject to adjustment must be reflected in the accounting records in the current period by corresponding entries in correspondence with account 84 “Retained earnings (uncovered loss).”

If minor errors are identified in the financial statements for the previous reporting period, even after the date of their approval by the owners of the organization, then they are corrected in the current period of their identification. Profit or loss arising in this case are reflected, respectively, as part of other income or expenses of the current reporting period in accordance with clause 14 of PBU 22/2010 and are taken into account when forming the financial result of the current year.

IMPORTANT IN WORK

Small businesses, incl. and those using the simplified tax system, to simplify the procedure for adjusting financial statements, the method of correcting a minor error can be applied to significant errors. This possibility is provided for in the last paragraph of clause 9 of PBU 22/2010.

In our opinion, if a small enterprise using the simplified tax system chooses a simplified method of correcting significant errors made in the annual financial statements, then it must be fixed in the accounting policies of the organization. This is due to the fact that PBU 22/2010 provides for options for resolving this issue. Namely, small enterprises and socially oriented non-profit organizations have the right to correct significant errors either in a general manner or in a simplified procedure established for correcting minor errors. At the same time, comparative indicators of financial statements for the previous reporting year of small enterprises, incl. and those using the simplified tax system may also not recalculate. In other words, small enterprises may not apply retrospective recalculation in relation to comparative indicators in accordance with clause 9 of PBU 22/2010.

Example 1.

Standard LLC applies the simplified tax system “Income minus expenses”. The organization's financial statements for 2021 were approved by the annual meeting of owners in March 2021. In April 2018, the organization's accountant discovered errors made in accounting in November 2021. The cost of production services provided by a third party in the amount of RUB 45,000 was mistakenly not taken into account as expenses. In addition, the buyer’s receivables in the amount of RUB 4,200 were mistakenly written off as other expenses.

According to the provisions of the accounting policy in force in the LLC, the errors made are considered significant. Correction of significant errors made in the annual financial statements is carried out in a simplified manner in accordance with clause 9 of PBU 22/2010. The accounting policy also does not provide for retrospective recalculation of comparative indicators.

In this case, the correction of significant errors made last year is reflected in the accounting of the current period by the accountant at the expense of other income and other expenses (balance sheet 91) on the basis of an accounting certificate. The following accounting entries are prepared:

Due to the fact that “simplers” have the right to correct significant errors in the current financial statements and without retrospective recalculation of comparative indicators, these values ​​will be reflected in the annual financial statements for 2021. This means that in this case there is no need to prepare revised financial statements for 2021.

Example 2.

In the same organization, an accountant in April 2021 identified another error made in December 2021. This error, in accordance with the accounting policy, is recognized as insignificant, which means it is also corrected in the current period, i.e. in 2021. This error arose due to the fact that in 2021, paid services provided by a third-party organization for the repair of low-value equipment in the amount of RUB 3,300 were erroneously not taken into account as expenses.

In this case, the accountant of Standard LLC should reflect this amount as part of other expenses in April 2018. Provide the following accounting entry:

D91 K 60 3,300 rub.

Please note that all these corrections are reflected in accounting on the basis of the relevant Accountant's Certificate, the basis for which is the primary documents. In this case, there is also no need to prepare revised financial statements for 2021.

IMPORTANT IN WORK

Accounting errors recognized as a gross violation of accounting rules entail the imposition of fines provided for in Article 120 of the Tax Code of the Russian Federation. Moreover, the amount of the fine depends on whether there were similar accounting violations in the previous year. If it was not, then the fine will be 10,000 rubles, but if such distortions were allowed, then the fine will reach 30,000 rubles.

GOOD TO KNOW

If errors made in accounting also led to a distortion of the tax base for the “simplified” tax, then the amount of the fine will be 20% of the unpaid tax, but not more than 40,000 rubles.

ORIGINAL SOURCE

A gross violation means a distortion of the amounts of accrued taxes by at least 10% and (or) a distortion of any item in the financial statements by at least 10%.

— Article 15.11 of the Code of Administrative Offenses of the Russian Federation.

So, based on the above, we can draw the following conclusion: the norms of PBU 22/2010 provide for two ways to adjust financial statements. The first is that all correction entries must be completed on December 31st of the year to which the error relates. After which it is necessary to recalculate the annual financial statements and submit revised ones, i.e. updated copies to all interested parties. In the second method, small businesses, incl. those using the simplified tax system can correct errors in a simpler manner and make adjustment entries in the accounting of the year in which the error was discovered.

This means that the errors of 2021, discovered only now, can be corrected in 2021. Accounting entries must be made in the month in which the error was discovered. In this case, profits or losses of previous years will be formed on account 91 “Other income and expenses”. In this case, there is also no need to adjust the financial statements of the previous year and provide users with revised financial statements for the previous year.

Thus, small business organizations and, of course, “simplers” have the right to choose an acceptable method of adjusting financial statements, which must be stated in the organization’s accounting policies.

Results

Errors in accounting and tax accounting are a headache for an accountant, since this means recalculating accounting items and amounts of taxes paid.
And if the error is discovered by the tax authorities during an audit, the company will also pay a fine, and the official will be disqualified (if violations were detected more than once). You can find more complete information on the topic in ConsultantPlus. Free trial access to the system for 2 days.

Examples of using new accounts

In February 2021, the autonomous institution discovered a mistake made in 2021: expenses for current repairs of the building in the amount of 980,000 rubles. erroneously attributed to the increase in the cost of the building. The following accounting entries were made:

This is an example of a significant error.

Events after the reporting date, the information about which is material, are determined by the organization independently based on the general requirements for financial statements (FSBU for public sector organizations “Events after the reporting date”; Order of the Ministry of Finance of Russia dated December 30, 2017 N 275n).

We can talk about an insignificant error if there are distortions in the analytics or KBK. For example, when registering construction materials (cement, paint, boards), account 105 36 “Other inventories - other movable property of the institution” was used instead of account 10534 “Building materials - other movable property of the institution”

The accounting records as of the date of discovery of the error from previous years (02/20/2019) reflect the following corrective correspondence:

Heading:

Public sector accounting

accounting policies correction of errors accounting financial statements of the organization FSB

• Yulia Volkhina, expert of the Kontur.Accounting project Budget of the SKB Kontur company

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