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Explanations of accounting, taxes and audit in Uzbekistan. Articles not yet translated are shown in Uzbek.
Accounting without writing: how did the Inca Empire keep its accounts on knotted cords?
How did an empire with no writing keep track of its population, harvests and livestock? The answer: in coloured cords and the knots tied in them. Short key points about the Andean accounting device called the "quipu", and an example checked with a summary cord.
Break-even point: how many cups a day must a café sell to cover its costs?
If 60 cups of coffee are sold every day, the café makes neither a profit nor a loss. Why, with average sales of 85 cups, is Monday still a loss? Contribution margin, the margin of safety, what happens if rent goes up or milk gets dearer, and operating leverage on the example of one café.
Splitting a change in revenue into the price effect and the volume effect: the index method on the example of one shop
A shop's revenue rose by 2 million soum in a month. Is that because it sold more, or because prices went up? Value, price and volume indices on the example of three goods, how they are linked, and why two ways of calculating give two different answers.
Paying by letter of credit: how does the bank protect both sides, and how is it accounted for on account 5510?
The buyer says «goods first», the seller says «money first». A letter of credit settles this dispute through the bank: the money is placed in a separate account in advance, and the seller receives it only after presenting the documents. The mechanism, a partly used letter of credit and all the journal entries under NAS No. 21, on the example of a tile sale.
Conditional and unconditional deductible (franchise): how much is the insurance payout reduced?
A loss of 2.9 million brings a payout of zero, a loss of 3.1 million brings the full 3.1 million: that is how the «jump» of a conditional deductible works. An unconditional deductible, by contrast, takes the same amount off every loss that exceeds it. Calculations and journal entries for five different losses, a percentage deductible and three incidents in one year.
Leasing or a bank loan: which way of acquiring equipment works out cheaper?
Total payments came to 408 million soum under the loan and 425 million soum under the lease. So is the loan cheaper? Not always: once the time value of money is taken into account, the answer comes to depend on how valuable the company's spare cash is. A full calculation on the example of a sewing workshop, with the journal entries for both routes.
Management's written representation (ISA 580): why does the auditor ask for it and what does it contain?
At the end of the audit the auditor asks the director for a signed letter. What does this letter confirm, who signs it, what date is put on it, and how does the report change if the director does not sign: 8 points under ISA 580 and the example of a flour mill.
Property tax advance payments: who pays monthly, who pays quarterly, and how is the year-end settlement made?
A legal entity pays property tax during the year in advances, but the schedule depends on the type of taxpayer. The deadline for the statement, monthly and quarterly advance dates, the minimum value check, the year-end difference and the 10 percent rule on the example of two companies, with journal entries.
Finished goods from receipt into the warehouse until sale: account 2810 and journal entries at actual cost
A carpet workshop accumulated costs throughout the month and at month-end delivered 300 carpets to the warehouse. How is the actual cost of one carpet obtained, how are a sale, an exhibition, office use and a shortage written off from 2810, and how is the variance allocated when records are kept at a standard price: a full calculation.
Re-import (code 41): what happens if exported goods come back, and how is it recorded in the accounts?
The buyer returned part of an export consignment. What conditions does the Code set for bringing it back without duties and taxes, from when is the time limit counted, and how does the returned product reduce revenue and cost of sales: 8 points and an example with dried apricots.
Processing outside the customs territory (code 61): if raw material is processed abroad and brought back, what is formalised and how is it reflected in the accounts?
Fabric went abroad to have a pattern printed on it and came back as printed chintz. Which permit is needed, on which value are duty and VAT calculated, what happens if the product does not come back, and through which accounts does the fabric pass in the books: the example of a textile company.
How audit evidence is gathered: 7 procedures (ISA 500)
Inspection, observation, external confirmation, recalculation, reperformance, analytical procedures and inquiry: what each one proves well and where it is weak. A table using a hypothetical leather goods factory, sufficiency and appropriateness of evidence, and reliability factors.
Quality management in an audit firm: ISQM 1 and ISA 220 (Revised)
Audit quality does not depend only on the skill of one auditor: at firm level there is an eight-component system (ISQM 1), and at the level of each engagement the engagement partner's responsibility (ISA 220). Tables and practical situations using a hypothetical small audit firm.
Materiality in an audit: overall materiality, performance materiality and the clearly trivial threshold (ISA 320 and 450)
Which error does the auditor consider "big", and what does the auditor do with the misstatements found? Using a hypothetical cannery: choosing a benchmark, three thresholds, accumulating misstatements, asking management to correct them and evaluating uncorrected misstatements, all with figures.
The system of internal control: 5 components and how the auditor understands it (ISA 315, revised in 2019)
The five components of the system of internal control shown on a small café, the difference between the design, implementation and operating effectiveness of a control, a table of common deficiencies, and how a deficiency found changes the audit approach.
How is an audit planned: the overall audit strategy and the audit plan (ISA 300)
Before opening a single document, the auditor decides two things: the scope, timing and staffing of the audit (the strategy) and exactly which procedures are performed in each area (the plan). Using a hypothetical dairy plant: who takes part, what is recorded, when the plan is updated, a timeline and a checklist.
Financial ratios reference: solvency, liquidity groups (A1–P4), stability and profitability
Solvency, balance sheet liquidity (groups A1–A4 and P1–P4), financial stability and profitability ratios in one reference: for each, the formula in words and by balance sheet line codes from Order No. 181. Everything is calculated on the figures of the hypothetical «Bo'stonliq Suv» LLC, with the links between the ratios.
What is a share, and how does an ordinary share differ from a preference share?
What a shareholder actually owns, why face value differs from market price, and where ordinary and preference shares part ways. Using «Zarafshon Keramika» JSC as an example: on which balance sheet lines (410, 420, 440) and accounts (8310, 8320, 8410, 8610) shares appear.
What is recorded in the books when a joint-stock company issues shares and buys back its own shares?
Issuing additional shares, receiving money from subscribers, a price above face value (8410 "Share premium"), issue costs (9630), buying back own shares (8610), reselling and cancelling them: journal entries using «Zarafshon Keramika» JSC as an example, based only on rows of NAS No. 21.
A company buys shares of another company: how is it accounted for? (NAS No. 12)
How short-term (5810) and long-term (0610) investments are told apart, what goes into the purchase cost, what to do when the market price changes at year-end, how a dividend and the result of a sale are recorded. Using «Ipaksoy Tekstil» LLC as an example, with paragraphs of NAS No. 12 and rows of NAS No. 21.
Tax on dividends: who withholds it and how is it calculated?
Under the Tax Code, a company paying dividends is a tax agent. Rates for residents and non-residents, legal entities and individuals (Articles 337, 353, 381, 382), temporary reliefs for dividends on shares in force until the end of 2028 (Article 483), the reporting and payment deadline, and journal entries using «Shahrixon Avto» JSC as an example.
What is a bond: coupon, face value, maturity and how it differs from a share
A bond is a debt security: what face value, coupon, maturity, discount and premium mean, and why the price moves opposite to interest rates. A calculation using a «Chorvoq Energiya» JSC bond, a comparison table with shares and the tax on bond interest (Tax Code, Articles 41, 304, 344, 378, 381, 483).
Issuing and buying bonds: accounting by the issuer and the investor
For the issuer — selling bonds at a discount or premium (0960, 3220, 7220, 6220), accruing the coupon, transferring to the current portion and redemption; for the investor — buying a bond (0610, 5810), accruing the discount, receiving the coupon and redemption. Using «Chorvoq Energiya» JSC and «Kumushkon Agro» LLC as examples, based only on rows of NAS No. 21.
Stock and bond markets: worldwide and in Uzbekistan
What the primary and secondary markets, a stock exchange and stock indices are; how the London and New York exchanges began, how the Dow Jones and S&P 500 indices are calculated (with our own example). In Uzbekistan: the Republican Stock Exchange «Toshkent», the capital market regulator and sovereign bonds placed on the international market.
Refund of excessively collected tax: a template application to the tax authority
Did the tax authority debit more than necessary from your account through a collection order? The filing deadline, refund deadline and interest under Articles 103–105 of the Tax Code, the forced collection procedure, step-by-step actions, a template application in the name of a fictional company (DOCX) and an analysis of the wrong article references in an old template.
An error found in last year's financial statements: what should you do? (NAS No. 1, Chapter 10)
Change in accounting policy, change in accounting estimate, material and non-material error: a decision table based on paragraphs 108–118 of NAS No. 1. Using «Sabo Mebel» as an example, we show how depreciation understated last year is corrected, how comparative figures are restated and what goes into the notes.
There is a profit, yet cash has halved: analysing one company's balance sheet in eight tables (a financial analysis case study)
The hypothetical «Bo'stonliq Suv» LLC closed the year with a net profit of 204 000 thousand soum, but the cash in its bank account halved. Asset and liability structure, condition of fixed assets, working capital, liquidity, financial stability, turnover and profitability: for each indicator, the formula, the calculation, what it means and the takeaway for the manager.
How is the personal income tax and social tax calculation formed proactively: what does the accountant upload, and what does the system calculate itself?
The calculation and its five appendices, the columns of Appendices 4 and 5 uploaded by the tax agent, the order for companies with branches, where the main lines come from (in a table), a one-month numerical example and typical mistakes that follow from the guide's restrictions.
Why accounting is needed: its five functions shown on one bakery
Using one month at the «Tong non» bakery, we walk through the five functions of accounting: a cost budget, the path from document to journal entry, splitting a plan-versus-actual variance into causes, who needs the figures, and a markup and margin analysis.
Contract, charter, minutes and certificate: 8 ready-made samples (services, employment contract, LLC charter, change of director, car sale, sale of a share, liquidation)
8 complete samples using fictional companies: a services agreement, an employment contract, a certificate of employment, a single-founder LLC charter, minutes of participants' meetings on changing the director and selling a car, an agreement for the sale of part of a share and a decision to liquidate an LLC. NAS No. 21 journal entries for services, wages and the sale of a fixed asset, Word (DOCX) files.