Profit and Loss Report of Companies in Poland and Germany Against the Background of EU Norms: Experience for Ukraine

Eurointegration touched all spheres of the Ukrainian economy, in particular, sphere of accounting and financial reporting. For example, the Law of Ukraine "On Accounting and Financial Reporting in Ukraine" was brought into line with the legislation of the European Union – the Directive 2013/34/EU, the procedure for applying International Financial Reporting Standards was improved. Therefore, the analysis of the Profit and Loss Report of companies in Poland and Germany is relevant from the perspective of studying foreign experience. The purpose of the article is to analyze the form of the Profit and Loss Report of the company in Poland and Germany to examine the common and distinctive features of it in these countries, to identify national characteristics and to determine the level of compliance of national criteria with the provisions of the Directive 2013/34/EU. The specifics of the format and content of the Profit and Loss Report of companies of each country were determined that are conditioned by the historical circumstances of the countries' development, the economic structure and the development of accounting schools. Signs of similar approaches have been revealed: the accounting legislation of both Poland and Germany makes it possible to apply two report formats. In particular, in Poland it is a calculating or a comparative version, in Germany – a working expenses method or a method of gross expenses. Such approach is in one line with the norms of Directive 2013/34/EU, which allows companies to choose from one of two options for the Profit and Loss Report – by function or by nature of expenditure. It was revealed that the difference between the report formats in individual countries and the EU legislation is due to the approach to disclosure of expenses, while the disclosure of income is more universal and international. German companies are able to use two options for generating a Profit and Loss Report – a working expenses method or a method of gross expenses. Revenues in both versions are disclosed in a similar way, but disclosure of operating costs occurs in different ways. Against this background, the possibility for Ukrainian companies to prepare a Profit and Loss Report on only one format looks like the absence of an alternative.