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Due to the continuous increases in prices and the fact that the financial statements of companies do not fully reflect the purchasing power of the date on which they belong, the previous practices related to the revaluation rate have been abolished and replaced by the "Inflation Adjustment" known as "Inflation Accounting".

In general terms, inflation adjustment is the correction of financial statements that cannot express the real situation due to changes in the purchasing power of money, in order to ensure that they express the real situation. is subjected to the process. In addition, in TPL Article 298/A, which contains general provisions regarding inflation adjustment, inflation adjustment is defined as "calculation in terms of purchasing power at the date of the financial statement". Accordingly, inflation adjustment is a process that consists of increasing the Turkish Lira values of non-monetary assets included in the financial statements to the value of the date of the table.

What are the conditions for inflation correction?

The increase in the price index (D-PPI); If it is more than 100% in the last three accounting periods, including the current period, and more than 10% in the current accounting period, inflation adjustment must be made in the financial statements.

Why is inflation adjustment important?

Inflation adjustment is the purification of financial statements from the effects of high inflation that has lasted for many years, thus eliminating the negativities arising from inflation on taxation and the purchase date of the financial statement. It is important to show purchasing power at its real value. Unlike other applications, it also corrects the liability items of the balance sheet and thus prevents companies operating with their own resources from being negatively affected by inflation.

Who will make the inflation correction?

It is made by income or corporate taxpayers who determine their earnings on the basis of balance sheet, including Joint Stock Companies, Limited Companies, Cooperatives, Collective and Limited Liability Companies. Freelancers do not make corrections. (They can depreciate their economic assets subject to depreciation based on their corrected amounts.)

Step-by-step inflation correction

It is determined which of the assets in the financial statement are non-monetary assets.
Non-monetary assets have amounts (amounts subject to correction) to be taken into account in inflation correction.
Non-Real Financing Costs (ROFM) included in non-monetary assets are separated.
In inflation correction, the dates of correction and the corresponding adjustment/carryover coefficients are determined.
The adjusted amounts are calculated by multiplying the amounts subject to correction with their respective correction/carryover coefficients.
Inflation differences between the adjusted values of non-monetary assets and the pre-adjustment values are recorded.
Non-monetary assets are shown with their adjusted values, and monetary assets are shown in the financial statements without being adjusted.

What is ROFM?

Non-Real Financing Cost (ROFM). Among the financing expenses incurred by taxpayers in their borrowings and added to the cost or purchase price of non-monetary assets, there is also an element aimed at compensating the loss of value in the debt amount due to inflation in the relevant period. In other words, since the amount of loss that the lender will suffer due to inflation in the repayment of the debt is included in the financing expense, the remaining part (only the real part of the financing expense) after separating the inflation loss of the principal within the financing expense added to the cost or purchase price must be taken into account in the inflation adjustment.

For example; A professional printer worth 200,000 TL was purchased for the company. A loan was taken for this purchase and the 50,000-TL financing cost was added to the cost of the vehicle.

If the printer costing 200,000 TL is accepted as 250,000 TL and inflation correction is made, it would be wrong because the real price of the printer is 200,000 TL.

50,000 TL is a non-real financial expense and it must be separated. Only the real cost value of the printer is subject to inflation adjustment.

Monetary and non-monetary assets

Monetary value; They are assets whose nominal values remain the same in the face of changes in the value of national currency, but whose purchasing power changes in the opposite direction according to price movements.

For example; Cash, Bank, Receivables, Debts, etc.

Non-monetary assets; In the face of changes in the value of national currency; They are assets whose purchasing power does not change.

For example; Fixed assets (fixtures), stocks, etc.

What are non-monetary assets?

Non-monetary assets that will be subject to inflation adjustment are in the table below. given.

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Faydali bir içerik olmus. Tesekkürler.

Yakup Aydin - 15/02/2024

elinize sağlık

murat eren - 08/03/2024

Bilgilendirici bir içerik olmuş teşekkürler.

Evren Abda - 20/03/2024

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