International Journal of Business and Management Studies,

CD-ROM. ISSN: 2158-1479 :: 1(2):481–491 (2012)

COMPARATIVE ANALYSIS REGARDING THE ACCOUNTING

MEASUREMENT BETWEEN INTERNATIONAL FINANCIAL
REPORTING STANDARDS AND ACCOUNTING REGULATIONS IN
ROMANIA

Iulia Jianu

Bucharest Academy of Economic Studies, Romania

The acceleration of the privatization process, the development of the capital market and free market
economy required the on-going development of Romanian accounting system, aiming to a better
harmonization with the international financial reporting standards. Accounting in Romania, from 2000
until now, has undergone a continuous process of harmonization with the international financial
reporting standards. The central question of this study is to reflect to what extent the accounting
measurement in Romania was influenced by the accounting harmonization. Thus, this study conducts a
comparative analysis regarding the accounting measurement between international financial reporting
standards and accounting regulation in Romania. The results of the study reveal the significant
differences regarding the measurement bases used in accounting and the disclosure of information in the
notes to the financial statements.

Keywords: Disclosure, IFRS, Measurement, Romania.

Introduction

The phenomenon of harmonization echoed also in Romanian accounting which, since 2000 has stepped
into a new phase of reform. While in the early '90s we turned to the French accounting model in order to
build the accounting system in our country, later the Romanian regulator opted for a joint accounting
system, having both European and international influence and having its pillars on the Fourth Directive of
the EEC, on the one hand, and on the IAS/IFRS, on the other hand. Romania didn’t stagnate during the
implementation of IAS/IFRS in the national accounting culture, but in the last ten years it has been
subject to a continuous and complex process of changing the accounting rules for assimilation, even in
part, of the international accounting culture.
Was this shift necessary? An answer to this need of remodelling of the Romanian accounting system
was given, initially by the appearance of Order 403/1999 for approving the accounting regulations
harmonized with the Fourth Directive of European Economic Community and with the International
Accounting Standards, which was then replaced with the Order 94/2001. The appearance of this
legislation has brought significant changes in the Romanian accounting environment. Direct implications
of the new accounting rules were found in the manner of publication and communication of accounting
information provided by financial statements. Basically, since 2001, there was three steps in the
accounting systems in Romania:



481
482 Iulia Jianu

9 during 2001-2002, the companies quoted on the Stock Exchange and the large companies that met
the criteria established by the Order 94/2001 issued and published financial statements that were
harmonized with the European and international accounting referential, the small and medium-
sized companies continued to apply the old accounting rules provided in the Accounting Law
82/1991, subsequently amended by OG 61/2001 and approved by Law 310/2002.
9 during 2003-2005, it came to light both a developed accounting system, which referred to the
Order 94/2001 and also a simplified accounting system that was built around the Order 306/2002
for approving the simplified accounting regulations harmonized with European directives.
9 during 2006 – present, the Order 1752/2005, replaced with the Order 3055/2006 for approving
accounting regulations in conformity with European Directives demands for all entities in
Romania to apply the European accounting rules.
The present study aims to identify in the first part, the measurement rules that exist in national
referential and in IFRS, and in the second part, the requirements of disclosure in the notes to the financial
statements of the measurement rules for balance sheet items according to the national and international
referential.

1. General Rules for Measurement

Next we present the general rules for evaluating the items in the balance sheet, both at the initial
measurement and at a subsequent measurement made by the entity, on the one hand according to national
regulations, and on the other hand according to IFRS standards.

1.1. Measurement in Accounting in Accordance with the National Accounting Regulations

According to the national accounting regulations, all elements are initially recognized at the historical
cost represented by the acquisition cost or by the production cost. According to the national accounting
regulations, after the initial recognition, all items are measured at historical cost except for:
9 the tangible assets, for which revaluation model is chosen, and which are valued at fair value on
revaluation date, less the accumulated depreciation and the subsequent recorded losses from
impairment;
9 the financial instruments in consolidated statements, including derivatives of financial
instruments that can be measured at fair value, if this basis of measurement is chosen. According
to the Order 3055/2009, the fair value does not apply to the measurement of non-derivative
financial instruments held to maturity, to loans and to receivables generated by the entity and
which are not held for trading, to interests in subsidiaries, associated companies and joint
ventures, to equity instruments issued by the company, to contracts with contingent payment in a
business combination and to other financial instruments with such special characteristics and
which, in accordance with what is generally accepted, are accounted for differently from other
financial instruments;
9 the short-term financial investments that are listed and that are valued at fair value at the end of
the financial year. In this respect, the Order 3055/2009 states that short-term securities admitted
to trading on a regulated market shall be measured at the value of trading on the last trading day,
and those nontraded at historical cost less any adjustments for lost value. Also, long-term
securities are valued at historical cost less any adjustments for lost value.
The national accounting regulations specify in a simplified way the calculation of the cost of
acquisition and of the production cost. Regarding the fair value, the Order 3055/2009 defines fair value by
indicating that it can be determined only by professionals in evaluation, without giving details on the
calculation of fair value.
 Comparative Analysis Regarding the Accounting... 483

The acquisition cost of goods includes the purchase price, import taxes and other taxes (except those
which the legal person may recover from the tax authorities), the transportation and handling costs and
other expenses that may be directly attributable to the acquisition of goods. The acquisition cost also
includes fees, notary fees, costs of obtaining permits and other not recoverable costs that are directly
attributable to those goods. The transportation costs are included in the acquisition cost even when the
supply function is outsourced. The commercial discounts granted by the supplier and purchased on the
invoice adjust in terms of reduction the acquisition cost of goods. The commercial discounts received
after billing, regardless of the period they refer to, stand out distinctly in the accounting, in the account
609 "Received trade discounts” and does not affect the acquisition cost of goods.
The production cost of a good comprises the acquisition cost of raw materials and production
supplies and the expenses directly attributable to the good. The production cost or the processing cost of
inventory as well as the production cost of fixed assets include the direct costs related to production:
direct materials, energy consumption for technological purposes, direct labour and other direct production
costs, the cost of product design and the share of indirect costs of production that is rationally allocated as
being related to their manufacture.
The borrowing costs that are directly attributable to the acquisition, the construction or the
production of a long life asset may be included in the cost of that asset. For example, borrowing costs
may include the interest rate on the capital borrowed to finance the purchase, the construction or the
production of long life assets, as well as the commissions for these loans. Borrowing costs may be
included in the production costs of a long life asset, insofar as they are related to the period of production.
The capitalisation of borrowing costs should cease when most of the activities necessary to prepare the
long life asset for manufacturing are made for its use or sale. In the case of including the borrowing costs
in the value of assets, these should be presented in the notes. The long life asset represents the asset that
necessarily requires a substantial period of time to be ready for its pre-established use or sale.
The fair value is the amount for which an asset may be exchanged willingly between the parties in a
transaction with the objectively established price. In general, the fair value of assets is determined in
terms of the evidence data on the market, through a valuation that is usually done by qualified
professionals in evaluation. Where there is no data on the market on fair value, because of the specialized
nature of assets and because of the reduced frequency of transactions, the fair value may be determined by
other methods typically used by the professionals in evaluation.
Order 3055/2009 does not have additional information on the determination of fair value. The only
indications in this respect may be found in art. 143, section (1) of the order, but they are related to the fair
value measurement of financial instruments in the consolidated accounts. In this respect, it is stated that:
"The fair value is determined by reference to:
a) the market value, for those financial instruments for which a credible market may be easily
identified. If the market value may not easily be identified for an instrument, but it may be
identified for its components or for a similar instrument, the market value can be derived
from that of its components or from that of the similar instrument; or
b) a value determined by using valuation models and techniques that are generally accepted for
the instruments for which a credible market may not easily be identified. Such models and
techniques should provide a reasonable approximation of market value and they should be
tested periodically (and revised if necessary) by comparing the provided values with the
observable actual transaction prices or by any available market information".
The analysis of national accounting regulations identified 5 stages of measurement:
9 the input measurement
9 the inventory measurement
9 the balance sheet measurement
9 the subsequent measurement
9 the output measurement
484 Iulia Jianu

The input measurement is made at: acquisition cost - for assets acquired by entity; production cost -
for goods produced in the entity; the value of contribution, established after the evaluation - for the goods
representing contribution to capital; fair value – for the goods obtained free of charge or found additional
to the inventory. In the last two cases, the value of contribution and the fair value are substituted to the
acquisition cost. To explain this statement, that is also presented in Order 3055/2009 art. 50, section (1),
the value of contribution or the fair value represent the acquisition cost of the bought goods that were
received as contribution or the goods that were received free of charge or the goods that were found
additional to the inventory.
The inventory measurement require in accordance with the Accounting Law no. 82/1991 that entities
to conduct an inventory of items such as assets, liabilities and equity held in the early work, at least once
during the financial year during their operation, in the case of the merger or closure of the activity, as well
as in the following situations: at the request of the control bodies during the check or of other bodies
provided by law; whenever there are indications that there are gaps or strengths in management, which
may only be definitely determined by inventory; whenever there is a handover of management; during the
reorganization of administrations; due to natural disasters or to cases of force majeure; other cases
provided by law.
In the chapter related to the measurement of tangibles, Order 3055/2009 states that "the inventory
value is determined in terms of the utility of the good, its condition and the market price". It is an
ambiguous definition that does not provide much information on the calculation of the value of inventory.
Thus, the inventory value may be represented either by the use value or by the market price. If we relate
to the practice of evaluation, the evaluation is based on the market price. But, if we relate to the
international financial reporting standards, where there is no notion of the inventory value for tangibles
and intangibles (the evaluation is done only when there are indications that the asset may be impairment),
we find that there is a methodology for calculation: the recoverable value which represents the maximum
between the use value and fair value less the costs of sale.
In the case of stocks, the inventory value is represented by the net realizable value that is equal to the
estimated selling price that could be obtained in the ordinary course of business, less the estimated costs
for the completion of the good, when appropriate, and the estimated costs necessary for sale. In the case
of receivables and payables, the inventory value is represented by their probable value of collection or
payment under the Order 3055/2009, respectively by the amortized cost under the IAS 39.
If we refer to the short-term financial investments or to the assets included in the category of tangible
assets, the determination of the inventory value is done differently depending on the way in which
securities are listed or not on the stock exchange, respectively as they are in a majority or minority stake
of shares. The listed securities are evaluated by methods indicated by the regulatory body of the capital
market. The mostly used method is to estimate the current value of a security at the lowest level between
the weighted average of the prices at the transactions that took place on the last day on the stock exchange
and the price of the last transaction of the day, provided that it is a relevant price, that is, to relate to at
least 0.5% of the issuer's securities. The securities that are not listed and that represent a minority stake
are evaluated by the dividend capitalization method and those that represent a majority stake may be
evaluated by the same method of dividend capitalization or by other methods based on the overall
evaluation of the entity in which it was invested (Toma, 2009). In the IFRS, the financial assets held for
trading or financial assets available for sale are always measured at fair value except for the moment in
which it cannot be determined and therefore, the measurement is carried at cost.
The balance sheet measurement is made:
a. in the case of the input value of intangible assets, less the depreciation and the accumulated
adjustments from impairment.
b. in the case of tangible assets:
i. at the input value, less the depreciation and accumulated adjustments from impairment;
ii. at the revalue value, less any subsequent accumulated depreciation and any loss from
subsequent accumulated impairment.
 Comparative Analysis Regarding the Accounting... 485

c. in the case of financial assets, evaluation is done for long-term securities at historical cost less
any adjustments for loss of value; and for the fixed receivables at the probable cash value. The
receivables denominated in foreign currency or those with the settlement in national currency
according to the rate of a currency is valued at the exchange rate announced by the National Bank
of Romania, valid on the date at the end financial year.
d. for inventories, at the lowest between the accounting value and net realizable value
e. in the case of receivables at the expected cash value. The receivables denominated in foreign
currency or those with the settlement in national currency according to the rate of a currency is
valued at an exchange rate announced by the National Bank of Romania, valid on the date at the
end financial year. In order to present the balance sheet, the value of receivables, as evaluated,
diminishes along with the adjustments for loss of value.
f. for short-term financial investments, evaluation is done differently depending on whether or not
those securities are admitted on a regulated market: if the securities are admitted on a regulated
market, the evaluation measurement is carried at their fair value which is represented by the value
of trading in the last day of transaction and if the securities are not admitted on a regulated
market, the measurement is carried at historical cost except the cases of any adjustments for the
loss of value.
g. in the case of cash and other similar values, the measurement is done at their nominal value in
accordance with the law. If the cash and other similar values are expressed in foreign currency,
the evaluation is done at the exchange rate announced by the National Bank of Romania, valid on
the date at the end financial year.
h. in the case of liabilities, at the expected value of payment. Liabilities expressed in foreign
currency or those with the settlement in national currency according to the rate of a currency, are
valued at the exchange rate announced by the National Bank of Romania, valid on the date at the
end financial year

The Subsequent Measurement:

a. in the case of intangible assets, the subsequent expenditure will allow the asset to generate future
economic benefits beyond the initially anticipated performance and they may reliably be
evaluated, they will increase the cost of an intangible assets.
b. in the case of tangible assets:
i. the subsequent expenditures that have the effect of improving the initial technical parameters
of the asset and which lead to additional future economic benefits (either directly by
increasing the incomes or indirectly by reducing the maintenance and the operating costs) as
opposed to those initially estimated, they will increase the cost of the tangible asset.
ii. the revalue value representing the fair value at the balance sheet date when the revaluation
takes place.
The examples of subsequent expenditures incurred on existing tangible assets which enhance the
future economic benefits are: performing work on tangible assets aimed at increasing the operational
capacity, the reduction of technological loss and of specific consumption; upgrading some components of
tangible assets in order to obtain substantial increases in the quality of production or of activity; caring
out modernization work on existing buildings and constructions, in order to increase the degree of
comfort and environment (Guidelines for the implementation of Order 3055/2009).
The output measurement is made to:
a. the input value
b. the value to which they are recorded in the accounts (eg, the revalue value for tangible assets
which were revalue or the fair value for short-term securities admitted to trading on a regulated
market).
486 Iulia Jianu

1.2 Measurement in Accounting in Accordance with the International Financial Reporting

Standards

All assets are measured on initial recognition at historical cost, except for: financial assets measured at
fair value through profit and loss account; available for sale financial assets; assets recognized due to a
financial lease contract; biological assets and the agricultural produce.
Subsequently to the initial recognition, the historical cost may be used to measure the following
items: exploration and the evaluation assets, if the revaluation model is not chosen; inventories, if the cost
is lower than the net realisable value; tangible and intangible assets measured at cost; investments in
equity instruments without a quoted price in an active market and whose fair value cannot be reliably
measured, plus their associated derivatives; investment property, if the fair value model is not chosen;
The initial recognition at fair value is done in the following cases: financial assets which are
measured at fair value plus, for all the other financial assets, the transaction costs that are directly
attributable to the acquisition or to the issue of the financial asset; assets recognized due to a finance lease
contract, which are measured at fair value if this one is lower than the present value of minimum lease
payments; biological assets and the agricultural produce, which are measured at fair value less the
estimated points of sale costs.
Subsequently to the initial recognition, if the model of measurement at fair value is chosen where
it is allowed, it means that most of assets may be measured at fair value, as shown in the table
below.

Table 1. The measurement of assets after the initial recognition.

ASSET Subsequent measurement bases
Financial assets:
- loans and receivables amortized cost - accounting rule
- financial assets held to maturity amortized cost - accounting rule
- available-for-sale financial assets fair value - accounting rule
- financial assets valued at fair value through profit fair value - accounting rule
and loss account
Tangible and intangible assets fair value – alternative treatment
Investment property fair value – basic treatment
Noncurrent assets held for sale minimum between the cost and the fair value minus the
costs of sale - accounting rule
Biological assets fair value minus the costs estimated at the point of sale -
accounting rule
Exploration and the evaluation assets fair value – alternative treatment
Inventories: minimum between the cost and the net realisable value -
-raw materials, finite products, goods accounting rule
-the agricultural produce fair value minus the point of sale costs - accounting rule
Cash and cash equivalents historical cost - accounting rule

2. Disclosure of Information Regarding Measurement in the Notes to the Financial Statements

Next it is presented informational requirements on the measurement in accounting which must be

disclosed in the notes to the financial statements. The presentation will be by category of items and only if
the national or international regulations require disclosures of data on the measurement in notes to
financial statements. Thus, in the description made below, there will be presented all existing
requirements in the national and international accounting referential on measurement methods and rules
that must be disclosed in notes to financial statements.
 Comparative Analysis Regarding the Accounting... 487

2.1 Disclosure in the Notes to the Financial Statements in Accordance with the National
Accounting Regulations

Tangible and Intangible Assets

The notes to the financial statements must provide for each group of tangible assets, the measurement
bases used in determining the carrying value (historical cost or revalued value. If different measurement
bases have been used, then a gross carrying amount should be presented for each group. However, if the
economic entities performed revaluations on tangible assets, the methods for calculating the revalued
amount should be provided in the notes.

Long-Term Financial Assets

The long-term financial assets are measured at historical cost but the entities must to present in the notes
to the financial statement their fair value.

Inventories

The notes present the cost of acquisition or the cost of production of the inventories shown in the balance
sheet and the valuation methods of the inventories. If the value of inventories in the balance sheet,
established by one of the FIFO, WAC, LIFO methods, differs significantly from the value determined
according to the last known market value prior to the balance sheet date, the value of this difference must
be disclosed in the notes as sum for each category of assets.

Receivables

In the national accounting regulations, the only details regarding the information that should be disclosed
in the financial statements regarding the evaluation of the receivables of an economic entity are those
relating to the bases of conversion used to express them in the national currency.

Short-Term Financial Investments

The disclosure of information regarding the evaluation of short-term financial investments is not required
in the notes. There is one exception, which applies to consolidated accounts, for financial instruments
measured at fair value. Thus, the economic entity must disclose in the notes: the significant assumptions
underlying the evaluation models and techniques; for each category of financial instruments: the fair
value, the changes in value included directly in the profit and loss account and the changes included in the
fair value reserve; for each class of derivative financial instruments, information on the scope and the
nature of the instruments, including significant terms and conditions that may affect the value, the timing
and the certainty of future cash flows; a table showing changes in fair value reserve during the financial
year.

Provisions

Order 3055/2009 requires economic entities to disclose a separate note in the financial statements on
provisions. But the information needed to be disclosed in this note refers only to the value of provisions at
the beginning and at the end of the financial year, respectively to the increase or to the decrease of the
value of provisions during the financial year, without presenting the calculation method of the value at
which reserves are recorded in the accounting.
488 Iulia Jianu

Liabilities

The only details included in the national accounting regulations, regarding the information that should be
disclosed in the financial statements on the evaluation of the liabilities of an economic entity, are those on
the bases of conversion used to express them in the national currency.

Equity

The national accounting rules do not require the disclosure of information in the notes regarding the
equity items.

2.2 Disclosure in the Notes to the Financial Statements in Accordance with the International
Financial Reporting Standards

Tangible and Intangible Assets

IAS 16 requires the disclosure of the following information regarding the measurement of tangible assets
in the notes: the measurement bases used in determining the book value; the significant methods and
evaluations used in the estimation of the fair value of the items; the way in which the fair values of the
items have been determined directly by reference to the prices existent in the distance transactions in an
active or recent market, or the way in which they have been estimated using other evaluation techniques;
for each revalued class of tangible assets, the book value that would have been recognized if assets had
been recorded at the model of determining the cost; when applying the model of cost determination, the
fair value of tangible assets when it is significantly different from the book value (optional).
IAS 38 requires the disclosure of the following information regarding the measurement of intangible
assets in the notes: any change in the book value of intangible assets; for the intangible assets acquired
through a governmental grant and initially recognized at the fair value: the fair value initially recognized
for these assets; their book value and if they are measured after recognition in accordance with the cost
model or with the revaluation model; the book value of the revalued intangible assets; the book value that
would have been recognized if the revalued class of intangible assets had been measured after the
recognition by using the cost model; the significant methods and assumptions applied in estimating the
fair value.
IAS 36 requires the disclosure of the following information on tangible and intangible impairment in
the notes: if the recoverable value of the asset represents its fair value less the selling costs or its value in
use; if the recoverable value is the fair value less the selling costs, the basis used to determine the fair
value less the selling costs; if the recoverable value is the value in use, the discount rate used for current
estimates and for the past estimates of the value in use;

Investment Property

IAS 40 requires the disclosure in the notes of the following information on the measurement of
investment property: if an entity applies the fair value model or the cost model; the significant methods
and assumptions applied in determining the fair value of the investment property, including a statement
showing that the determination of the fair value was based on market indications or on other factors
(which the entity will present), due to the nature of the real estate and to the lack of comparable market
data; the way in which the fair value of investment property (as it was measured or disclosed in the
financial statements) is based on the measurement performed by an independent valuer who holds a
recognized and relevant professional qualification and who has recent experience in the location and the
categories of investment property which is subject to measurement; the total change in the fair value
 Comparative Analysis Regarding the Accounting... 489

recognized in the profit and loss account for a sale of the investment property from a group of assets in
which the cost model is used in a group that uses the fair value model.
When an entity applies the fair value model for its investment property, but it still measures an
investment property at cost because it cannot reliably determine its fair value, in addition to the above
specifications, it must also submit the following information on the measurement: an explanation for the
reason why the fair value cannot be reliably determined; if possible, the range of estimates within which it
is most likely to find the fair value. If an entity applies the cost model for its investment property, it is
required to submit their fair value in the notes.

Non-current Assets Held for Sale

IFRS 5 does not require in the notes the disclosure of the information on the measurement of fixed assets
held for sale.

Biological Assets

IAS 41 requires in the notes the disclosure of the following information on the measurement of the
biological assets: the significant methods and assumptions applied in determining the fair value of each
group of agricultural products at the point of harvest and of each group of biological assets; the fair value,
less the estimated selling costs at the point of sale of the agricultural products harvested in the period,
determined at the point of harvest.

Inventories

IAS 2 requires in the notes the disclosure of the following information on the measurement of the
inventories: the accounting policies adopted in the measuring of inventories, including the formulas used
to determine the cost; the value of any reduction in the value of inventories recognized as expense in the
period.

Financial Instruments

IFRS 9 requires in the notes the disclosure of the following information on the measurement of financial
instruments: the measurement basis used for each class of financial assets, financial liabilities and equity
instruments; for each class of financial assets and financial liabilities, the entity will disclose information
on the fair value of that class of assets and liabilities in order to allow the comparison with the
corresponding book value in the balance; if financial instruments of unquoted equity or derivatives are
measured at cost because their fair value cannot be measured reliably, it will be presented, together with a
description of financial instruments, their book value, an explanation for the reason why the fair value
cannot be properly measured and, if possible, the range of values in which the fair value is most likely
included; the significant methods and assumptions applied in determining fair values of financial assets
and financial liabilities, separately for significant classes of financial assets and financial liabilities; if the
fair values of financial assets and financial liabilities are determined directly, wholly or partially, with
reference to the published price quotations in an active market or if they are estimated using a valuation
technique; if the financial statements include financial instruments measured at fair values which are
determined wholly or partially by using a valuation technique based on the assumptions that are not
supported by observable market prices or rates. If the adjustment of such assumptions in a reasonable
possible alternative would result in a significantly different fair value, the entity will declare this and it
will present the effect of a series of possible assumptions on the fair value; the total value of the changes
in fair value which is estimated by using a valuation technique that was recognized in the profit and loss
490 Iulia Jianu

account for the period; the fair value of assets received as accepted guarantees and the fair value of any
such asset received as guarantee either sold or repledged.

Provisions

IAS 37 does not require in the notes the disclosure of information regarding the method of determining
the value of recognized provisions.

Conclusions

Significant differences between measurement rules that are specific to assets can derive from the analysis.
Obvious differences arise primarily because of the different method to classify items in the balance sheet.
Thus, according to national regulations, a building purchased by the entity in order to be held on a long
term is considered a tangible asset, regardless if the building will be used by the entity in its work, will be
leased to third parties or will be later held for sale. However, under IFRS, the building is classified
differently depending on the purpose for which the entity owns the building: tangible asset if it intends to
use the building in its work or for administrative purposes; investment property if the entity owns the
building to rent it to third parties or to increase the building’s value in the future; noncurrent assets held
for sale if the entity intends to sell the building in the short term. Thus, if the tangible assets, both national
regulations and IFRS standards provide the same measurement accounting treatments, that is, the
historical cost or the revaluation of tangible assets, if the entity considers that the value at the balance
sheet date differs significantly from the accounting value. Regarding investment property, these items are
found only in the international accounting referential, the entity can choose between the fair value
measurement as a basic treatment and the historical cost measurement as an alternative treatment.
Regarding noncurrent assets held for sale, according to the international reference system, the entity shall
classify the items in the category of current assets, evaluating them at the lower value between the
historical cost and the fair value.
Another difference due to the different method to classify items in the balance sheet arises in the case
of biological assets. Under IFRS these assets are always valued at fair value minus the costs estimated at
the point of sale. Instead, in the national accounting referential, the notion of biological assets does not
exist, so that such assets are considered tangible assets, following their measurement accounting
treatment.
Financial assets are other factors that generate differences in the accounting measurement in the two
accounting referentials. According to national referential, financial assets are grouped into two broad
categories: on the one hand, financial assets (presented in the category of noncurrent assets) always
valued at historical cost, less any impairments found and on the other hand, short-term financial
investments (presented in the category of the current assets) valued at historical cost for listed shares or at
fair value for non-listed shares.
Regarding the inventory, the measurement accounting rules are similar in the two accounting
referentials: national and international. There are some exceptions: under the national referential, LIFO
valuation method is allowed, as opposed to the international referential where LIFO valuation method is
prohibited; under the national referential the notion of agricultural produce does not exist, so these items
fall in the category of inventories being valued at the minimum between cost and net realizable value,
unlike the international referential where the agricultural produce is valued at the fair value less the point
of sale costs.
In terms of information that is needed to be disclosed in the notes to financial statements regarding the
measurement of the items in the balance sheet, as it resulted in the description made in the content of the
paper, according to the national referential, there are very few disclosure requirements in the notes that
are related to valuation methods and rules, unlike the international referential where disclosure
requirements are much more.
 Comparative Analysis Regarding the Accounting... 491

Acknowledgements

This work was supported from the European Social Fund through Sectorial Operational Programme
Human Resources Development 2007-2013, project number POSDRU/89/1.5/S/59184 „Performance and
excellence in postdoctoral research in Romanian economics science domain”. Financial support from the
Centre of Studies in Accounting and Management Information Systems at the Bucharest Academy of
Economic Studies is gratefully acknowledged.

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3. Jianu, I. and Jianu, I. (2008) “Definirea úi evaluarea performanĠei – de la origini până în prezent”, Journal of
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4. Ristea, M. and Jianu, I. (2010) “Fair Value – From Abstract Theory to Practical Reality”, Journal of
Accounting and Management Information Systems, Vol. 9, No. 3, pp 448–466.
5. Toma, M. (2009) IniĠiere în evaluarea întreprinderii”, Bucharest: CECCAR.
6. Order 403/1999 for approving the accounting regulations harmonized with the Fourth Directive of European
Economic Community and with the International Accounting Standards.
7. Order 94/2001 for approval of accounting regulations harmonized with the Fourth European Economic
Community and with the International Accounting Standards.
8. Order 306/2002 for approving the simplified accounting regulations harmonized with European directives.
9. Order 1827/2003 for amending and supplementing some accounting rules in the accounting environment.
10. Order 907/2005 regarding the approval of legal bodies categories that apply the accounting rules in
accordance with the IAS/IFRS.
11. Order 1752/2005 for approving accounting regulations harmonized with European Directives.
12. Order 2.001/2006 regarding the approval of legal bodies categories that apply the accounting rules in
accordance with the IAS/IFRS.
13. Order 3055/2009 for approving accounting regulations in conformity with European Directives.