At the conclusion of the two-day workshop held by the Central Financial Supervision Organization at the Al-Assad National Library in Damascus under the title “Re-evaluating physical assets in companies and public institutions of an economic nature,” the participants stressed the importance of re-evaluating the existing assets belonging to the public sector at their true and fair value that expresses The results of its operations and financial positions.
In a presentation he made during the workshop, Director of the General Authority for Taxes and Fees, Munther Wannous, confirmed that the advantages of revaluing physical assets include increasing cash profit, negotiating a fair price for the facility’s assets, increasing financial leverage, improving the financial position of the borrowing process, securing liquidity, addressing the inflationary effects on the reality of the facility’s work, and rebuilding Cost lists for products.
He pointed out that there are a number of caveats to revaluation, including the company spending a large amount on revaluing fixed assets because this work requires assistance from technical experts, in addition to an increase in expenses and thus less profit, and revaluation may be used in illegal ways that lead to maximizing the company’s financial position. Without controls and contrary to reality.
Wannous believed that the revaluation process may lead to an emergency increase in the tax upon revaluation, a decrease in tax revenues in the following years, and an increase in the value of physical assets, and then the amount of consumption and competitiveness increases in a way that leads to an increase in economic efficiency and later an increase in tax revenues provided that the efficiency of the production process increases, and the tax value is reduced. Income.
Dr. Kamal Semsemia, the economic agent at the Central Financial Supervisory Agency, gave a presentation on “The Implications of the Revaluation of Physical Assets on the Accounts of Results and Financial Policies of Companies and Public Institutions and the Role of the Central Agency in Oversight over them,” in which he explained that the current assets of the establishments are valued according to the historical cost at the purchase price on the date of acquisition. Pointing to the importance of Prime Minister’s Circular No. 15-45 of 2015, regarding dealing with lost, stolen or destroyed assets during the terrorist war with the aim of removing them from the accounts and lists of these parties.
Semsimiya pointed out that the re-evaluation must be in accordance with specific controls that ensure that unreal profits are not shown or values are underestimated, explaining that these controls will be monitored by the Central Financial Supervision Organization, as it is the body entrusted with protecting public funds and studying the lists and current accounts of public entities of an economic nature. And follow up on the re-evaluation process in all its stages.
He believed that the re-evaluation shows the fair values of physical assets and will have positive effects, which requires weighing the advantages and disadvantages in order to make the appropriate decision and reach decisions that determine which public companies the evaluation will be applied to or which will be applied to all institutions, indicating that the entity that will conduct the re-evaluation will be From inside and outside the institution, the process of studying and controlling this process will be the responsibility of the central agency so that the reflection on the financial statements is correct.
In another axis related to the role of tax legislation in the revaluation process, member of the Society of Certified Public Accountants, Maher Wahba, explained that the in-depth legal study of sectoral and institutional revaluation and the provision of the legislative framework regulating the revaluation process contribute to strengthening the financial position of establishments and institutions of an economic nature, developing their capital, achieving their continuity, and increasing the pace of the process. productivity in it.
Wahba explained the necessity of basing the process of revaluing physical assets on the unified accounting system, as legal legislation contributes to creating positive regulatory effects as a result of determining the actual economic reality of institutions, pointing to the great experiences gained by the Society of Accountants and other financial unions in revaluing assets that differ between institutions. Others are the result of various factors such as the nature of the assets and the time and timing of the return process.
Tariq Al-Sayed and Waseem Al-Adawi
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