CONCEPTUAL APPROACH OF THE METHODOLOGY FOR PREPARING REPORTING DATA IN A COMPARATIVE FORM TO CALCULATE FINANCIAL STANDING INDICATORS

Abstract

Calculation of financial standing indicators based on financial reporting forms (complete or simplified) contains a set of measures, which should be observed in a strict sequence (bringing data into comparative form; determining criteria and indicators for assessing financial standing; calculating indicators for the period under review; assessing financial condition by indicators over time; developing specific measures and making managerial decisions) to perform high-end economic analysis, the purpose of which is also preventing information distortion in the justification of effective management decisions at the micro and macro levels. Prevention of erroneous conclusions becomes possible already at the first stage of implementing economic research – bringing the data into a comparative form. Currently, in addition to the definitions of the main terms regarding the composition of financial statements which are included in the legislation, there are practically no scientific studies on the correctness of applying financial standing indicators in calculations using financial reporting indicators of various types – at the reporting date and for the reporting period, despite they are in one corresponding reporting period (quarter, half-year, year). The publication presents conceptual methodological approaches to ensuring comparability of financial reporting indicators for calculating and analyzing financial standing indicators provided comprehensive information content is accessible of reporting data over time. In view of the lack of methodology in this area, conceptual methodological approaches have been developed to assess the comparability of financial reporting indicators and, if necessary, to bring its indicators to a comparable form for calculating financial standing indicators. The developed conceptual approaches are the basis for further alternative modeling, depending on the purpose of the study and other factors, such as the comprehensive information content of reporting data over time. As a result of the scientific development, the author of the study has provided conceptual proof of the expediency of conducting annual reports and interim reports in the analysis, the methodological need to bring its indicators to a comparable form for calculating financial standing indicators using special procedures, such as calculating the "arithmetic mean balance sheet" and preparing a "settlement statement of financial standing", respectively, depending on the time parameter of reporting. The relevance of the procedure for preparing reporting data for a comparable form before the fundamental analysis is proved.