In order to clarify the procedure for applying the amendments introduced by Decree No. 3365-U to Regulation No. 385-P in the part concerning the valuation and accounting of participatory interests in subsidiaries and affiliated joint-stock companies, let us give the following example.
On 01.10.2013, a credit institution purchased shares of non-resident joint stock company ABC in the amount of 10,000 shares (11% of voting shares) at the price of 200 conventional units per share and recorded on balance sheet account No. 507 “Equity securities available for sale”.
01.08.2014, the credit organization purchased shares of non-resident joint stock company “ABC” in the amount of 2,800,800,000 shares (3% of voting shares) at the price of 250,000 conventional units per share and recorded on balance sheet account No. 506,000,000 “Equity securities at fair value through profit or loss
As of 31.10.2014, the current (fair) value of shares of the joint stock company -non-resident “ABC” amounted to 255 conventional units per share.
On 28.11.2014, the credit organization purchased shares of the joint stock company -non-resident “ABC” in the amount of 6,000 shares at the price of 260,000 conventional units per share, as a result of which the number of shares of the joint stock company -non-resident “ABC” held by the credit organization amounted to 18,800 shares (21% of voting shares).
According to the requirements of the clause, the number of shares of the joint stock company -non-resident “ABC” amounted to 18,800 shares (21% of voting shares).
In accordance with the requirements of paragraph 2.3 of Appendix 10 to Regulation № 385-P the credit organization’s investments in shares of non-resident joint stock company “ABC” are subject to transfer to balance sheet account № 601 “Participation in subsidiary and affiliated joint stock companies, unit investment funds”
The official exchange rate of the conventional unit against the ruble as of November 28, 2014 amounted to 50.0775 rubles per conventional unit
On 28.11.2014 the credit organization will make the following accounting entries.
When recording on balance sheet account No. 601 “Participation in subsidiary and affiliated joint-stock companies, unit investment funds” purchased on 28.11.2014 shares of the joint-stock company the shares of the joint-stock company purchased on 28.11.2014 shares of the joint stock company -non-resident “ABC” for the amount of 1 560 000 conventional units (6 000 shares x 260 notional units per share), which amounts to 78 120 900 rubles (1 560 000 000 notional units x 50.0775 rubles per notional unit):
Debit of balance account № 601 “Participation in subsidiary and affiliated joint-stock companies, unit investment funds” Credit of correspondent account
When transferring shares of the joint stock company -non-resident “ABC” classified at acquisition as “available for sale”:
On the amount of positive revaluation of securities 27 542 625 rubles (255 conventional units per share – 200 conventional units per share) x 10 000 shares x 50,0775 rubles per conventional unit)
Debit of balance sheet account No. 10603 “Positive revaluation of securities available for sale”
Balance sheet account No. 10603 “Positive revaluation of securities available for sale”
Credit of balance sheet account No. 50721 “Revaluation of securities – positive differences”
on the value of investments in securities 2 000 000 000 conventional units (10 000 shares x 200 conventional units per share), which amounts to 100 155 000 RUR (2 000 000 000 conditional units x 50.0775 RUR per conditional unit):
Debit of balance sheet account No. 601 Participation in subsidiary and affiliated joint stock companies, unit investment funds
Credit of balance sheet account № 507 “Equity securities available for sale”
Balance sheet account № 507 “Equity securities available for sale”
When transferring shares of the joint stock company -non-resident “ABC”, classified at acquisition as “at fair value through profit or loss”:
On amount of positive revaluation of securities 701 085 rubles (255 conventional units per share – 250 conventional units per share) x 2 800 shares x 50,0775 rubles per conventional unit):
Debit of balance sheet account № 70602 “Income from revaluation of securities”
Credit of balance sheet account No. 50621 “Revaluation of securities – positive differences”
Balance sheet account No
On the value of investments in securities 700 000 conventional units (2 800 shares x 250 conventional units per share), which amounts to 35 054 250 rubles (700 000 conventional units x 50,0775 rubles per conventional unit):
Balance sheet account № 000 conventional units x 50,0775 rubles per conventional unit
Debit of balance sheet account № 601 “Participation in subsidiary and affiliated joint stock companies, unit investment funds”
Credit of balance sheet account № 506 “Equity securities at fair value through profit or loss”
Balance sheet account № 506 “Equity securities measured at fair value through profit or loss”
As of 28.11.2014, the value of shares of non-resident joint stock company “ABC” (18 800 units (21% of voting shares), recorded on balance sheet account № 601 “Participation in subsidiary and affiliated joint stock companies, unit investment funds”, amounted to 213 330 150 rubles.on 15.12.2014, the credit organization sells shares of non-resident joint stock company “ABC” in the amount of 2,400 400 shares (3% of voting shares)
The value of the remaining shares of the non-resident joint stock company “ABC” (16 400 units (18% voting shares) after the sale on 15.12.2014, recorded on balance sheet account № 601 “Participation in subsidiary and affiliated joint stock companies, unit investment funds”, amounted to 186 047 928 rubles
In accordance with the requirements of clause 2.3 of Appendix 10 to Regulation No. 385-P, the remaining shares of this issuer are subject to transfer to balance sheet accounts for accounting of investments in equity securities.
According to the requirements of clause 2.3 of Appendix 10 to Regulation No. 385-P, the remaining shares of this issuer are subject to transfer to balance sheet accounts for accounting of investments in equity securities
Official exchange rate of the conditional unit against the ruble as of December 15, 2014 amounted to 49.9817 rubles per conditional unit.
Official exchange rate of the conditional unit against the ruble as of December 15, 2014 amounted to 49.9817 rubles per conditional unit
15.12.2014 the credit organization will make the following accounting entries related to transfer of the cost of investments in shares of the joint stock company -non-resident “ABC” from balance account № 601 “Participation in subsidiaries and affiliated joint-stock companies, unit investment funds” in accordance with its decision to balance account № 507 “Equity securities available for sale”.
For the remaining value of shares of non-resident joint stock company ABC in the amount of RUB 186,186,047,047,928,928 on balance sheet account No. 601,601 “Participation in subsidiary and affiliated joint stock companies, unit investment funds”:
The following shall be transferred to balance sheet account No. 601 “Participation in subsidiary and affiliated joint stock companies, unit investment funds”
Debit of balance sheet account No. 507 Equity securities available for sale
Credit of balance sheet account No. 601 Participation in subsidiary and affiliated joint-stock companies, unit investment funds
In the amount of 22 975 541 rubles of the difference between the book value of shares of the joint stock company -non-resident “ABC” (186 047 928 rubles or 3 715 200 conventional units) and the ruble equivalent of their current (fair) value of 209 023 469 rubles (16 400 shares x 255 conventional units per share (Current (fair) value of the share of the joint stock company -non-resident “ABC” as of 15.12.2014.) x 49,9817 rubles per notional unit):
Debit of balance sheet account No. 507 Equity securities available for sale
Credit of the balance sheet account for accounting of income (in OFR under symbol of income from operations with purchased securities). Further accounting of shares of the joint stock company -non-resident “ABC” is carried out by the credit organization in accordance with the requirements of Appendix 10 to Regulation No 385-P and paragraph 1.17 of Part I of Regulation No 385-P.