Restoration of Accounting

Restoration of accounting is a service rendered by competent specialists to make the accounting compliant with the laws of the Russian Federation. Restoration of accounting is reasonable for the accounting system which is found to have systematic errors the company is not able to eliminate using its own efforts.

Restoration of accounting includes the following steps:

• adjustment of existing accounting registers or creation of new ones;
• restoration of source documents;
• reconciliation with supervisory authorities;
• filing of statements and reports with the relevant authorities.

A company may need its accounting system to be restored if it has not been keeping accounting for a long period of time, for whatever reason. The fee for such service will depend on the document flow scope, urgency, and the inappropriate accounting duration.

Restoration of accounting: Stages

If accounting is restored in time, the company will not face grievous consequences expressed in big fines, forfeit and eventual bankruptcy.

Accounting restoration comprises the following stages:

• Check the degree of deficiency of accounting (this is where decision is made whether it is necessary to engage qualified experts for restoration)
• Pre-approve and agree on the scope of work, together with the client
• Restore of source documents
• Create new accounting registers or eliminate systematic errors in the existing ones (it depends on the degree of deficiency)
• Calculate and conciliate taxes and charges in arrears; payment of fines, penalties and forfeit
• Transfer insurance contributions
• File reports and statements with supervisory authorities

Consequences of inadequate accounting

Inadequate accounting can have irretrievable adverse impacts that will pose a threat to a company. The threat lies not only in high fines, but in further bankruptcy. In certain cases, company officials may be subject to criminal sanctions. According to the Tax Code of the Russian Federation, lack of source documents (registers and VAT invoices) and persistent out-of-time recording of financial transactions are considered to violate the income and expense accounting regulations.

The amount of fines for inadequate tax accounting and business accounting far outweighs the fee for accounting restoration services. Company officials sometimes happen to be late in making the decision to engage accounting experts, thus dooming their company to insolvency. If the decision to contract a services provider is made in time, it will guarantee successful business development.

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