Wine industry: economic and environmental factors which influence development and accounting

Economic Annals-ХХI: Volume 181, Issue 1-2, Pages: 105-114

Citation information:
Gutsalenko, L., Marchuk, U., Hutsalenko, O., & Tsaruk, N. (2020). Wine industry: economic and environmental factors which influence development and accounting. Economic Annals-XXI, 181(1-2), 105-114. doi: https://doi.org/10.21003/ea.V181-09


Liubov Gutsalenko
D.Sc. (Economics),
Professor,
Department of Accounting and Taxation,
National University of Life and Environmental Sciences of Ukraine
15 Heroiv Oborony Str., Kyiv, 03041, Ukraine
lyboffv@gmail.com
ORCID ID: https://orcid.org/0000-0001-5181-8652

Uliana Marchuk
PhD (Economics),
Associate Professor,
Department of Accounting and Taxation,
Kyiv National Economic University named after Vadym Hetman
54/1 Peremohy Ave., Kyiv, 03057, Ukraine
mar4ukuliana@gmail.com
ORCID ID: https://orcid.org/0000-0003-0971-1303

Oleksandr Hutsalenko
PhD (Engineering),
Associate Professor,
Vinnytsia Technical College
91/2 Khmelnytskyi Hwy., Vinnytsia, 21021, Ukraine
allgut62@gmail.com
ORCID ID: https://orcid.org/0000-0002-4561-3527

Natalia Tsaruk
PhD (Economics),
Associate Professor,
Department of Accounting and Taxation,
Separated Subdivision of the National University of Life and Environmental Sciences of Ukraine «Nizhyn Agrotechnical Institute»
10 Shevchenko Str., Nizhyn, 16600, Ukraine
tsnata011074@ukr.net
ORCID ID: https://orcid.org/0000-0001-5426-1378

Wine industry: economic and environmental factors which influence development and accounting

Abstract. The study identifies global trends in the wine industry development and focuses on its development in Ukraine, the country ranking 24th in the world in grape growing and wine production, as well as 11th in Europe and 20th in the world by areas certified as organic. The analytical assessment of wine-producing countries has made it possible to identify the main wine exporters and importers in the world. The research emphasized the active development of organic farming, including in the viticulture sector, influencing the qualitative characteristics of organic wine and wine made from organic grapes. It is proved that the organization of production of wines of controlled designations of origin (CDO) provides their higher category in combination with organic farming. The impact of external and internal factors on the cost of organic production is determined, and the necessity of standardization and certification in determining and consolidating the quality characteristics of wine is substantiated.

It has been proven that grape production and processing of grapes are related to one process of quality control and regulated by a normative document, which defines the essence of methods and quality indicators. On the basis of the register of qualified indications of origin of goods, we give an assessment of the qualitative characteristics of certain wines of Georgia, Italy and Ukraine with regard to specific areas of viticulture, in particular climatic conditions, water balance, soils, etc.

It has been proven that in the modern scientific literature there is no single approach regarding the ways and the bases of the distribution of costs of managerial character and their impact on the cost of wine production. It is justified that, when allocating costs, it is necessary to take into account different factors of influence that are specific to the industry only, in particular different varieties, their different quality characteristics and difference in production costs.

It has been determined that when forming the accounting policy of the enterprise with the justification of the base of cost sharing and strengthening of control functions of cost management in the production process, it is necessary to take into account grape growing technology, variety of grapes for certain climatic zones, quality characteristics of such a varieties, location of wine production plants and their remoteness from grape plantations, logistics, marketing and wine tourism that promote wines of certain producers.

The factors of influence on the qualitative characteristics of the grape and wine industry in Ukraine and the effectiveness of the accounting and control function in the management system are highlighted in the paper.

It as been concluded that control over the allocation of general production costs should be carried out in the interaction of the control function of accounting and management, since they are usually used separately in practice. The control function of managers at all levels must be implemented at all stages of production of high quality finished products with the risk assessment identified by the internal control system of the COSO model.

Keywords: Wine Production; Viticulture; Winemaking; Organic Winemaking; Accounting Policy; Factors; Control; Management; Cost Management; Wine; Grapes; Controlled Designations of Origin (CDO)

JEL Сlassіfіcatіon: E22; F00; F23; M40; M41; Q10

Acknowledgments and Funding: The authors received no direct funding for this research.

Contribution: The authors contributed equally to this work.

DOI: https://doi.org/10.21003/ea.V181-09

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