and
monitoring of the beta version of depreciation policy's information portal were
presented. To identify impact of the enterprise size on
the availability of information about individual indicators, they are grouped
according to the selected system of taxation (simplified and general). It was also concluded that
the accounting indicators can be used to quickly adjust the depreciation policy
at the state level.
Keywords: Depreciation Policy; Public Policy; Digitalization; Information;
Accounting; Reporting; Data Security
1.
INTRODUCTION
The
process of economy digitalization is not a new area of research. However, the
informatization of depreciation policy, as a process of interaction between
enterprises and the state is a relatively new direction of accounting theory, as
well as a new approach to the perception of depreciation.
In
many countries, depreciation policy is usually considered at the micro level,
mostly studying the state of implementation of depreciation policy in the
enterprise. Fewer studies are conducted at the macro level and taking into
account industry specifics by analyzing the technical feasibility of exchanging
accounting information. One of the purposes of this article is to reveal the
idea of effective interaction between state and enterprise in the
implementation of depreciation policy and the formation of a conceptual
framework of this economic phenomenon.
2.
LITERATURE REVIEW
2.1.
Review
of the literature on digitalization
Digitalization is commonly
understood as a transformation of digital technologies to optimize and automate
business processes, increase productivity and improve communication with
consumers. Currently, there are three areas of research related to this topic.
First area is a study of the digital
products special characteristics depending on the focus of their application.
Thus, the recent work by Goldfarb and Tucker (2019) contains an extensive study
of the literature on the digital economy to identify its differences. They
emphasize the reduction of costs associated with search, replication,
transportation, tracking and verification.
In addition, researches by Bakos and
Brynjolfsson (1999) study the effectiveness of grouping a large number of
information products, taking into account different properties and
uncertainties. In this context, Goldberg et al. (2001) analyzes the
cost-effectiveness of mechanisms for digitizing economic processes.
At the same time, the research does
not touch upon the consequences of digitalization of the interaction between
suppliers and customers, enterprises and the state, does not highlight the
digital aspect of "public policy". This article develops the
direction in research of complex interaction processes of business and state
subjects. The paper considers such a separate element as the depreciation
policy from the point of view of efficiency of application with the use of
digital technologies.
Second, there is a lot of literature
on information asymmetry, some of which is closely related to our article. For
example, Sobel and Takahashi (1983) and Cramton (1984) developed a model of
interaction of business entities over time. The authors explore the nature of
interaction, strategic behavior and timing of relationships between
enterprises.
In
this regard, Besanko and Winston (1990) compare the duration and effectiveness
of the interaction, and Hörner and Samuelson (2011) conduct modeling and
expand previous research. In our article, we will analyze the available results
of long-term interaction of the state and enterprises in the implementation of
depreciation policy. Consideration of the state from the angle of a partner
unit, rather than a regulatory institution, made it possible to understand the
organizational construction of the concept of digitalization of depreciation
policy.
Third area of research is the
justification of potentially necessary accounting data and the optimal
organization of their collection and use. Richard, Lindholm and Hogan (1968)
already emphasize the problems of using existing credentials and the need to
form a specific information array. We confirmed this concept and expanded it
based on the surveys of Ukraine's depreciation policy key stakeholders by
adding an organizational mechanism for interaction and exchange of information.
Important in the information approach Klenin (2004) assigns the relevance of
accounting information, without requiring other characteristics and features
that are put forward to the accounting information.
2.2.
Depreciation
policy
Keating et al. (1999) considered
depreciation policy in the context proposed by the state of the highest
metrological depreciation output. We worked with representatives that were used
for all depreciation support optimization messages and not for policy purposes.
At the same time, they claimed that the reliability changed to the depreciation
products that were necessary spent on R&D. However, other researchers have
found that this applies to research and is not cost-effective (Mead 2007; Okubo,
2006; Sliker 2007; Fixler 2009). In this article, we as well focused on the
organizational component of the depreciation policy implementation.
The
purpose of this article is to develop a conceptual framework for a common
accounting and information space of depreciation policy.
3.
METHODS OF RESEARCH
3.1.
Measures
to assess the reality of the depreciation policy implementation
Since the scientific
problem is how to assess the effectiveness of depreciation policy and what
impact the processes of digitalization of the economy have on its formation,
first, it is necessary to choose what indicators we should use to assess the
effectiveness of depreciation policy. The main indicator of the effectiveness
of depreciation policy is the fact of renewal of fixed assets at the expense of
own financing sources, increasing the efficiency of financial and economic
activities. The production structure of the labor means, performance indicators
of the enterprise and its financial statements are directly dependent on the
strategic direction of depreciation policy. Scholars in assessing the
effectiveness of depreciation policy use mostly the same indicators:
1)
Determination of the optimal
production, age and cost structures of fixed assets;
2)
Forecasting the useful life of
fixed assets;
3)
Forecasting future economic
benefits from the use of fixed assets;
4)
The choice and optimal
combination of permitted depreciation methods;
5)
Valuation of fixed assets from
the standpoint of depreciable value and liquidation value;
6)
The choice of the most effective
forms of reproduction of fixed assets and capitalization of depreciation.
In the course of the
research, a survey of 376 enterprises of Zaporizhia, Donetsk and Luhansk
regions of Ukraine was conducted according to the listed indicators. To
identify impact of the enterprise size on the availability of information about
individual indicators, they are grouped according to the selected system of
taxation (simplified and general).
We used these
indicators exclusively for compiling questionnaires when testing the software
product to ensure the digitalization of depreciation policy.
3.2.
Measures
to monitor the effectiveness of depreciation policy
The betta
version of the investment portal of the Melitopol city was used as a monitoring
system, as part of the work on which the instrument of depreciation policy was
modeled. The developed software environment brought together authorities,
entrepreneurs and representatives of fiscal structures. We understand that
large-scale implementation of the monitoring system requires time, money and
other resources, but in turn ensures the achievement of expected results.
4.
RESULTS OF THE RESEARCH
First, we investigated what information is
needed to conduct a depreciation policy in accordance with the specified
criteria for its effectiveness. Then we determined the availability of such
information in the standard forms of statistical and financial reporting of
enterprises.
At the same time, we conducted a survey on
these indicators of the selected group of enterprises. This allowed us to
specify the direction of the study of the effectiveness of depreciation policy
and focus on the most important part of fixed assets in the development of the
framework (see Figure
1).
Figure 1: Modeling the dynamics and structure of
investments to specify the terms of the conceptual framework reference for
digitalization of depreciation policy
Source:
developed by the authors
Questionnaires of accounting experts and
experts from the state regulation sector helped us to understand at what stages
of information processing the problem of its insufficiency arises. At the same
time, we found out the optimal level of regulatory policy intervention in the
economic independence of enterprise in the development of depreciation policy.
These
conclusions were based solely on expert opinion, as there are currently no
facts of such operational interaction (see Figure 2).
Figure 2: Depreciation policy accounting and
information support system
Source:
developed by the authors
To
optimize the exchange of information in the implementation of depreciation
policy, it was suggested to develop a conceptual framework.
At
the same time, it solved the problem of setting a technical task for the
development of a software product for the digitalization of the information
exchange process and the formation of an array of data for the operational
regulation of depreciation policy (see
Figure 3).
Figure 3: Conceptual framework
for digitalization of depreciation policy
Source:
developed by the authors
The developed
conceptual framework of depreciation policy was tested in the regional project
"Investment map of Melitopol", which was initiated by Melitopol City
Council of Zaporizhia region in cooperation with NGOs and producers in the
region to establish a systematic dialogue between government and business. The
study of the economic background and information content was conducted with the
assistance of the public organization "Innovation and socio-economic
initiatives".
The
result of this cooperation was a betta version of the interactive map of the
region as part of the digitalization of depreciation policy. Such a software
product was offered to companies and is currently being tested. For Ukraine,
this form of interaction between state regulators and enterprises that are
interested in technical re-equipment and ready for open cooperation is new.
Discussion of such a concept is currently carried out in the methodological,
technical and user areas.
5.
CONCLUSIONS
The authors reviewed the
literature on the digitalization of the economy and the implementation of
depreciation policy. Different approaches to the principles of organization of
interaction between the state and business entities allow us to make some
assumptions related to the concept of digitalization of depreciation policy.
First, depreciation policy cannot be separated from the general trends of
digitalization of society. Second, depreciation policy at the macroeconomic
level cannot be effective solely through the components of the depreciation
methodology, such as depreciation methods, useful lives, asset values. A
simplified understanding of depreciation policy as an accounting operation with
a fixed algorithm is no longer relevant or effective.
The authors also
described the trends of digitalization of the economy, creating a general
structure for the disclosure of its interaction with.
Since the scientific
problem is how to assess the effectiveness of depreciation policy and what
impact on its formation have the processes of digitalization of the economy,
the authors chose which indicators should be analyzed when assessing the
effectiveness of depreciation policy. Performance evaluation indicators, which
are most popular in various scientific studies, were presented.
As the selected
indicators are not present in the standard statistical and financial reports of
Ukrainian enterprises, the authors transferred them to the created questionnaire
(questionnaire form). This form was used in the creation of the betta version
of the software complex of the investment portal of the city of Melitopol,
which has in its components exactly those instruments of depreciation policy
that can be used in the scale of national digitalization of depreciation
policy.
To set the technical
task of such a complex, a conceptual framework of a single accounting and
information space of depreciation policy has been developed. The technical task
outlines the functionality of the software package, requirements for users and
generators of information, terms, forms and methods of filling the information
environment, organizational mechanisms of interaction of the participants of
the proposed space.
The main conclusion of
the research results is that in the information society the efficiency of
economic processes increasingly depends not on the methodological tools, but on
the organization of data exchange. Operational analysis and feedback also play
an important role in shaping an effective depreciation policy.
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CONCEPTUAL
FRAMEWORK FOR DIGITALIZATION OF DEPRECIATION POLICY