Economic theory

«Economic benefit» category as an estimation of revenues and expenditures

Economic Annals-XXI

Economic Annals-ХХI: Volume 137, Issue 1-2(1), Pages: 30-33

Citation information:
Svirko, S., & Osadcha, O. (2014). «Economic benefit» category as an estimation of revenues and expenditures. Economic Annals-XXI, 1-2(1), 30-33. https://ea21journal.world/index.php/ea-v137-08/

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Svitlana Svirko
D.Sc. (Economics),
Professor, Director,
Research Institute of Accounting of
Kyiv National Economic University named after Vadym Hetman
54/1 Peremohy Ave, Kyiv, 03680, Ukraine
svs3@ukr.net

Olga Osadcha
PhD (Economics),
Associate Professor,
National University of Water Management and Natural Resources Use
75 Prykhodko St., Rivne, 33002, Ukraine
levitska.olia@yandex.ua

«Economic benefit» category as an estimation of revenues and expenditures

Abstract. Introduction. The current legal aspect of the accounting for economic entities (irrespective of their legal form) connects the estimation of income and expenditures within the category of «economic benefit». In practical activity of entities there are different types of benefits, the most important of which, in our opinion, are material, social, and economic ones. Usefulness is a benefit, in this case the economic benefit as the potential usefulness of the assets use in the economic or financial turnover. The cost and economic benefit are the interrelated concepts: it is necessary to gain that is why it is advantageous to have; it is beneficial to have because it generates income. The purpose of the article is to summarize the national practice of assessment of income and expenses to determine methodological approaches of accounting for the economic benefit of business operations and non-commercial activities. Results. The approaches to the definition of the economic substance of income are considered in the article. In order to justify estimates of revenue and expenditure, the category of «economic benefit» is considered. It was determined that the subjects of entrepreneurial and non-entrepreneurial activity can carry out transactions of business nature, and revealed the structure of their financial results. Conclusion. In most cases, conditions of income in accounting business activities with international practice of accounting and reporting are supported. The basis of the recognition of income and expense is inflow (outflow) of economic benefits. It stays actual classification of income and expenses according to economic content of the subjects in terms of their self supporting activities and activities funded by trust funds (including budget allocations). Procedures of discounting potential EB on the balance sheet date (adjusting of accepted transaction amounts according to the expected changes on the macro- or micro levels) require further investigations.

Keywords: Income; Economic Benefit; the Nature of the Business Operations; Financial Benefits; Social Benefits; the Financial Result of Budgetary Institutions

JEL Classification: D33; E25; E64; L31

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Received 30.10.2013

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