Methodical Principles of Accounting for Grant Support to Ukrainian Agribusiness

Nataliia Tsaruk
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Nataliia Tsaruk: "Nizhyn agrotechnical institute" Separated unit of National University of Life and Environmental Sciences of Ukraine, Nizhyn, Ukraine

Oblik i finansi, 2024, issue 3, 43-49

Abstract: In the conditions of reduction in the volume of state subsidies and tax benefits due to the redistribution of resources to finance the defence industry, Ukrainian and international grants have become almost the only available means of supporting domestic agribusiness. Lack of experience in accounting for grant funds is one of the problems faced by accountants of agricultural enterprises. After all, grants as an object of accounting are, to a certain extent, a novelty for many business entities in the agrarian sector of Ukraine. The purpose of the article is to reveal the methodical principles of accounting for grant support to Ukrainian agribusiness, particularly in terms of recognising income from targeted financing, and to determine the tax consequences of using grant funds. A detailed analysis of the current legislation is the basis of this study. In addition, the author review the previous case studies, the systematisation of the results of which made it possible to clarify the method of accounting for grant support and reveal the tax consequences of using grant funds. Three options for recognising income were characterised based on the purpose of targeted financing, that is, the object to which the grant funds are directed. The article presents the procedure for recognising income from grant support on accounting accounts. The tax consequences of using grant funds by agricultural enterprises - VAT payers have been disclosed. The research results have a scientific and applied nature because they will help accountants of agrarian enterprises correctly disclose information about received state and international grants in accounting accounts and in reporting. The clarifications provided in the work regarding the tax consequences of using grant support make it possible to take a balanced approach to calculating the financial result before taxation and the share of agricultural production.

Keywords: grant support; accounting for grant funds; targeted financing; date of income recognition; tax consequences; agribusiness (search for similar items in EconPapers)
JEL-codes: M41 (search for similar items in EconPapers)
Date: 2024
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Persistent link: https://EconPapers.repec.org/RePEc:iaf:journl:y:2024:i:3:p:43-49

DOI: 10.33146/2307-9878-2024-3(105)-43-49

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