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Method of inventories evaluation during retirement.
The Company uses the following evaluation methods during retirement of inventories:
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method of weighted average cost;
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method of identified cost.
At use of the weighted average method, the cost of each item is determined as the weighted average of the cost of sim-
ilar interchangeable items at the beginning of the period and the cost of similar items purchased or produced during
the period.
Method of identified cost provides writing inventories down at the real cost of each unit determined according to the
item of Accounting Policy. This method is used for evaluation of the retirement of inventories in case of transactions with
accessories, assembly units and parts with nameplate data.
The Company uses the same evaluation method for all inventories with the same application and the same conditions
of usage.
Accounts Receivable
Accounts receivable are the contractual demands shown to buyers and other persons on reception of money resources,
the goods or services. For the purpose of financial reporting, accounts receivable is classified as current (obtainment is
expected within current year or operational cycle) or as long-term (accounts receivable which cannot be classified as
current one).
Accounts receivable is classified as commercial accounts receivable (originating for the goods and services sold during
usual economic activities) and uncommercial (other) accounts receivable. Initial recognition of accounts receivable is
performed at fair value of the transferred assets. Short-term accounts receivable is evaluated and reflected at net real-
izable value in financial reporting.
The Company accumulates doubtful debts for reflection of doubtful accounts receivable. Reserve of doubtful debts is
accrued based on financial solvency of separate debtors. Accounts receivable is referred to the doubtful debt accord-
ing to the following criteria:
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Limitation period of indebtedness expires earlier, than in 12 months from accounting date;
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The debtor is absent at the address specified in documents;
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The debtor is declared a bankrupt.
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