Impact of the COVID-19 pandemic on the preparation of financial statements (COVID-19 პანდემიის გავლენა ფინანსური ანგარიშგების მომზადებაზე)

1. The unpredictability of the pandemic impact generates fundamental uncertainties. It casts doubt on the ongoing operation of the enterprises. If the functionality assumptions are made during the financial reporting, the enterprise is obliged to declare all the uncertainty factors. Applied reasonings, conclusions, and compulsory volume for the information declaration are dependent on the specific situation, as its nature and impact level on the enterprise, differ in every single case. 2. The limited paying capacity of the customers impacts the contractual relationships. In many cases, it becomes necessary to amend the contracts – modify the contract costings. It is of utmost consideration to assess the payment probability while amending the contract under uncertainty. It should be discussed as the changing component of the payment. 3. In IFRS 16, the changes caused by pandemics, are important for the lessee’s. The board considers the registration of the tenancy modification to be an easy task, accordingly, these changes do not include the lessees. They should assess, as usual, if the rental exemption is actually a contract amendment, and process it accordingly.
1. Accounting Standards Committee & Auditing Standards Committee. Technical Circular [Report]. - 2021. 2. IASB [Online] // - January 3, 2022. 3. IASB [Online] // - January 2, 2022. 4. IASB [Online] // - 5. KPMG COVID-19 [Online] // COVID-19. - KPMG. - January 4, 2022. 6. Leo van der Tas [Online] // - Janury 15, 2022. - January 15, 2022 7. Levan Sabauri Impacts of COVID-19 on the Financial Reporting and Audit [Journal] // Economics and Business. - Tbilisi : Tbilisi State University, 2021. - Vol. 2. 8. Oliver Köster [Online] // How COVID-19 infects financial reporting and results presentations. - 2020. - January 15, 2022. 9. Thornton Grant 2.2020.pdf [Online] // 2.2020.pdf. - Grant Thornton.
amendment in the contract; going concern; pandemic and financial statement
International Scientific Conference Dedicated to the Establishment of the University and the 100th Anniversary of the Faculty of Economics and Business “Covid 19 Pandemic and Economics”, Tbilisi, 2022, pp. 276-284