4404

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A

19.Double-entry system is a system of recording business transactions B

requiring that each transaction should have equal debit and credit totals C D

thereby maintain a balance within the accounts taken as a whole. A B

20.As is known, gross profit method are used to estimate the value of inventory C D

assuming that the ratio of gross margin for a business is relatively stable from year to year.

Score 1 for each mistake spotted

Test 7

Modern Accounting Practices in Russia

Part A

Choose a correct variant

1.Being regarded as ... of economic management accounting in Russia is an information system that measures, processes, and communicates financial information about an economic entity to permit users of the system to make decisions and judgements.

a)one of the most essential aspects

b)one of the most important functions

c)the most important function

2.In Russia accounting practices ... thorough the decrees of the Ministry of Finance which is responsible for their organisation and implementation.

a)are provided

b)are included

c)are regulated

3.In accordance with Russia's current legislation all accounting provisions set by the Ministry of Finance must be... for all organisations on the territory of Russia.

a)compulsary

b)selective

c)permissible

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4.As a rule, specific directives ... by various bodies in Russia should not contradict to the standards and methodological directions approved by the Ministry of Finance

a)issued

b)provided

c)determined

5.Being ... of accounting system the general chart of accounts is compulsory for all businesses in Russia and facilitates finding the account in the ledger.

a)the basis

b)a link

c)one of the factors

6.Russia's present general chart of accounts, introduced in 2002,... about 100 main accounts.

a)concerns

b)contains

c)provides

7. ... in inflationary economies in different countries as well as their approaches to the recognition of the effects of high inflation in financial statements is extremely important.

a)Financial reporting

b)Financial Control

c)Financial analysis

8.According to Russia's legislation an enterprise may keep as many ... accounts as it is necessary for its reporting system.

a)synthetic

b)analytic

c)compulsory

9.As a rule, all regulations concerning format and content of the reporting system in Russia ... by the Ministry of Finance and they are obligatory for all enterprises.

a)are established

b)established

c)were drawn to

10.… signs all the financial statements and bears a full responsibility for their correctness.

a)The chief accountant

b)Auditors

c)Top-level managers

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11.According to experts Russian accounting practices towards international standards of late to meet the demands of the market economy.

a)have changed

b)have progressed

c)have regarded

12.Some experts think that a lack of transparency of existing accounting systems in Russia allows manag-ing directors of some enterprises to ... the true financial position of their enterprises.

a)reveal

b)conceal

c)show

13.It is common knowledge that one of the main factors of successful reforming accounting practices in Russia is ... of international accounting standards for public enterprises and IAS compatibility for the rest.

a)the introduction

b)the improvement

c)the elaboration

14.The process of ... Russia's accounting is not simple and it will demand a lot of time and efforts.

a)controlling

b)reforming

c)expanding

15.In Russia the cash flow statement ... as merely an attachment to annual financial statements.

a)is regarded

b)is implemented

c)is created

16.As is known, accounting practices in Russia ... on codified principles.

d)are reflected

e)are based

f)are transferred

17.Russia's accounting system discloses annual results based on ...

a)rough estimations.

b)payments received and transferred.

c)only payments transferred.

18.The Russian accounting system ... by a large number of balance sheet accounts.

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a)is determined

b)is reflected

c)is characterised

19.It is believed that the tax orientation of financial statements in Russia ... either officially or in practice.

a)has not been fully eliminated

b)has not been recognised

c)has not been associated

20.In Russia's accounting system all the fixed assets ... in sub-accounts grouped in sections.

a)are divided

b)are described

c)divided

21.As a rule, low-value items used in productive activity ... into the fixed assets of a business.

a)are contained

b)are included

c)are transferred

22.The amount of Charter capital of any business may be increased by...

a)creating different funds.

b)by borrowing money from banks.

c)partners' contributions and transferring retained earnings.

23.Reserve capital shown in account 82 ... from nq earnings of a business.

a)is calculated

b)is formed

c)is financed

24.Liabilities towards banks in Russia ... in two accounts: 1) short-term liabilities and 2) long-term liabilities.

a)disclose

b)are analysed

c)are disclosed

25.They say, that those enterprises in Russia which wil move to IAS accounting ... to keep dual accounting records i.e. RAS and IAS.

a)should not be required

b)should be made

c)are demanded

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26.Russian accounting traditions are based on the con cept which suggests ...

a)a providing information that enables its users tc assess the use of assets and measure return or. equity.

b)providing information about a company's liquidity and adequacy of its assets (measured at marke values) to meet all outstanding liabilities.

c)both mentioned above.

27.One of the specific features of the Russian accounting system is a concept of ...

which is absolutely unknown in many countries.

a)retained earnings

b)fund accounting

c)book-keeping

28.In accordance with Russia's legislation creating sun funds as an Accumulation Fund or a Consumption Fund is not...

a)optional.

b)mandatory.

c)important.

29.A Wellfare Fund provides monetary resources for ...

a)buying property.

b)stimulating personal performance.

c)the upkeep of housing facilities as well as cultural purposes.

30.According to present legislation the procedure for preparing financial statements on long-term investments depends on ... in the subsidiary and is regulated by decrees of the Ministry of Finance of the Russian Federation.

a)the amount of investments

b)the amount of taxable profit

c)the amount of income received

31.I reckon that cost-benefit ... demand processing large volumes of data, so we'll need a computerised information system.

a)calculations

b)analyses

c)approach

32.A decision to install a costly computer system because of potential loss of sales and customer discontent is a result of...

a)control principle.

b)cost-benefit principle.

c)flexibility principle.

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33.Computer data processing systems are ... in which recording, posting and other bookkeeping tasks are done with the aid of a computer.

a)the simplest type of data processing systems

b)the most advanced type of data processing systems

c)the primitive type of data processing systems

34.The development of large sophisticated computer systems has allowed businesses to centralise thei, accounting operations and ... much of the work thai used to be done by hand.

a)increase

b)eliminate

c)apply

35.With the development of computers, the need for1 total information system with accounting as its bast has become ...

a)unimportant.

b)more pressing.

c)unclear.

36.Data processing is the means by which ... gather data organise them into useful forms, and issue the resulting information to users.

a)accountants

b)the accounting system

c)computer operators

37.From my point of view, two extremes of data processing systems are ... systems and computer systems both of which do the same job.

a)manual

b)bookkeeping

c)time-consuming

38.A carefully designed accounting system will allows business to grow without...

a)making major alterations in it.

b)adding new assets, revenue etc., that require i's adjustments.

c)increasing its business transactions.

39.Instead of recording transactions with a pencil in a journal, posting to a ledger, and then preparing financial statements, the computer ... these steps internally on its hardware.

a)performs

b)processes

c)calculates

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40. Some economists indicate significant errors in the ... of price indices, including consumer price index, which represents an obstacle to obtaining comparable financial information.

a)interpretation

b)assessment

c)calculation

Score 2 for each correct answer. Total 80

Part В Find a mistake in the following sentences

A B C

1. One of the most important uses of the profit and loss account is compare the D

results obtained and the results expected.

A B 2. Earning profit is, after all, usually the main reason why the business was set

C

up in the first place, and the proprietor will want to know for various reasons D

now much profit have been made.

A B

3. Before to deduct expenses, gross profit percentage is usually computed, C D

because many businesses attach a great deal of importance to this indicator. A B

4. Without being taken into account the effects of inflation rates it is absolutely C D

impossible to reach objectivity and adequate comparability of financial statements. A B

5. According to experts, financial statements portrays the financial effects of C D

transactions and other events by grouping them into broad classes according their economic characteristics.

A B

6. On assessment key risks we have spent a great deal of time and labour on

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C D

designing an effective system of internal control, including planning and performing internal auditing procedures.

A

7. The problem of recognising the effects of high inflation in financial B C

statements, including consolidated accounts are especially relevant to Russia D

that has been in a period of hyperinflation since 1991.

A B C

8. On having exchanged a fixed asset for another asset which is dissimilar in use D

or purpose, the company should recognise a gain or an exchange of dissimilar assets.

A B

9. Providing information that meets the needs of such a large set of diverse C D

users are difficult, if not impossible, in a single set of financial information. A

10.By meeting the financial information needs of investors and creditors, B C D

accountants provide information that is also useful to another users of financial information.

A B C D 11.To keep расе with such a rapid flow of accounting information require using

computer-based accounting systems.

A B C

12.After processing cash transactions and sales we have began posting to the D

subsidiary ledgers and preparing the trial balance. A

13.I reckon, the accountant must to be able to work with many different kinds B C D

of accounting systems and may also have a voice in choosing the right sort of data processing for a business.

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A B C 14.The recording of business transactions can be done manually by having

D

entered each transaction from a source document, and posting each debit and credit to the correct ledger account.

A B 15.As is known, both computer and manual accounting systems need use

C D

special-purpose journals that have been in existence for many decades. A B

16.According to our chief accountant, it is worth to check the accuracy of the C

posting by adding the balances of the accounts payable and ledger accounts D

and matching the total with the Accounts Payable controlling account balance in the ledger.

A B

17.Apart from generate complete sets of financial statements immediately upon C D

the request, the computer can perform complex analyses for decision-making purposes.

A

18.The idea of standardising accounting procedures of different countries are B C

implemented within the framework of the accounting uniformity process D

carried out by International Accounting Standards Board (IASB). A

19.Under current Russian legislation the main objective of an audit is to B C

ascertain whether the financial statements of an entity gives a true and fair D

view and whether transactions of this entity comply with current legislation. A

20.I reckon, that the process of transferring Russian accounting practices to

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B C

IAS might to some extent accelerate by intensifying the work of the D

commission in charge of accounting reform.

Score 1 for each mistake spotted

Test 8

Accounting in the Future

Part A

Choose a correct variant

1.It should be noted that the accounting treatment for tax consequences ... in IAS12 is suitable for any tax system, including a Russian one.

a)including

b)prescribed

c)changed

2.There is no doubt that taxation and social security ... on economic efficiency, with their different systems having different effects.

a)have an influence

b)affect

c)effect

3.It is the mixture of Russian statutory requirements and internationally accepted solutions, which ... some hybrid financial statements based on Russian accounting rules and international consolidation principles.

a)result in

b)determine

c)provide

4.Being very close to Anglo-American system, international financial reporting standards ... external environment of the enterprise and continental accounting models such as German, French etc. are driven by internal factors.

a)aim at

b)focus on

c)lead to