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THE ROLE OF PROFESSIONAL JUDGEMENT OF AN ACCOUNTANT IN THE RATIONAL ORGANIZATION OF ACCOUNTING AND FINANCIAL REPORTING

Tudor TUHARI, Prof., PhD

Trade Co-operative University of Moldova

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Universal Decimal Classification: 657:006

JEL Classification: M41 

Abstract

The accounting system and the problems of its organization are largely due to the situation of international and national standardization in a market economy. National accounting standards provide a large variety of methods and techniques for recognizing and evaluating such elements as assets, equity, liabilities, income, expenses. The search for the most rational approaches in organizing the accounting is determined by the state of accounting policies, the content of which depends on the professional judgement of the accountant, i.e. on his creative and scientific level of implementing the issues for an economic entity’s accounting.

In this article, the author focuses on the development of the professional judgement of an accountant, as a piece of intellectual matter, which, as regards to his professional skills, is able to solve complex problems in organizing preparatory accounting work, in accounting and in drafting financial reporting.

A sufficient level of excellence in accountant's professional judgement is determined by the author through the ability to develop and use primary documents and registers of synthetic and analytical accounting, setting significance thresholds in the preparation of accounting policies, in terms of recognizing and evaluating the accounting elements, usingprovisions (estimated reserves) in the time-based distribution of expenses (current and future periods), as well as on organizing item-by-item the analytical accounting of costs and expenses at the enterprise.

Keywords: professional judgement of an accountant, rational organization of accounting, significance thresholds, accounting policies, recognition and evaluation of accounting elements