The law defines the range of information that should be presented in the explanatory noteand submission form that you define yourself. Along with the text of the explanatory note can be given analytical tables, graphs and charts. But to simplify the problem, pick up a sample form and explanatory notes from any of the reference and legal system. This form then you can edit the subject of its specificity.
Information to be disclosed in the explanatory Memorandum, can be roughly summarized in three groups: information about the organization; information on its accounting policies; the main factors affecting the organization's operations and financial results. Organization information includes details of the company, information about the head and chief accountant and Supervisory authorities, the average number of employees, size of share capital, information about the issued shares and the like basic information. Also essential part of this section of the explanatory note is to list and characteristics of the activities of the organization - natural and cost indexes and factors in the reporting year on the financial results. In this case the explanatory note should include everything activities, but only those of economic importance (percentage of revenue, assets, etc.) is not less than 10%, as well as those that appeared in the financial statements for the last reporting period.
In the explanatory note to the balance you have to reflect information on the accounting policy of your organization and changes therein. The essential recognized methods of accounting, essential for a correct assessment of your financial position to the interested users of financial statements and their decision-making. For example, are disclosed such positions as the order of recognition of revenue and expense recognition, methods of valuation of assets and inventories, methods of charging depreciation method of allocating resources between the activities of the etc for the next financial year proposes changes in accounting policies, the explanatory note must state the reason and content changes.
Information about the financial situation of the organization includes an extensive list of indicators for the reporting period affecting the financial activities of the organization from the consumer price index to the current ratio and the average wage in the organization. It is also necessary to show the dynamics data to compare the reporting year to the previous year. In this section of the explanatory note is appropriate any information useful to compile a full and objective picture of financial situation of the organization.
In the explanatory note you should specify, do you apply force in the Russian Federation accounting rules or allow the non-application of these rules (in cases where their observance does not provide complete and accurate mapping financial picture of the enterprise). The facts of non-use PBU must be justified!
In the explanatory note to the accounting statements you must disclose information about events after the reporting date that could affect the financial condition and results of operations of the organization. Such events may include the adoption of decisions on reorganization, announced the payment of dividends, causing loss of natural disaster, revaluation or sale of inventory, unexpected termination of the part of the organization's activities and so on. Sample list of facts of economic activity which can be recognized as events after the reporting date are presented in the Appendix to PBU 7/98.
Must also be disclosed information on the so-called conditional facts of economic activities, that is, such facts in respect of which the consequences and probability of their occurrence in the future there is uncertainty. It can be unfinished litigation or problems with tax authorities; issued, but not redeemed the obligations, guarantees, bills of exchange; moving organizations or parts of the region and other similar facts.
In addition to the above, in the explanatory note included topics such as information on the cost of energy resources; information on the joint activities of / discontinued operations; information about related parties (physical or legal persons able to exert influence on the organization's activities); any other significant financial information depending on the nature of the organization. Remember: explanatory note to the accounting reporting is your advertisement to a potential investor.