Chapter 2. Order an audit of intangible assets in the jsc "Bayan Sulu"

2.1 Brief description of the jsc "Bayan Sulu"

JSC “Bayan Sulu” is one of the largest confectionery production companies of the Republic of Kazakhstan. Factory is founded in December, 1974 and pleases buyers with the most delisious and high quality production more than thirty years.

Company surely moves together with intensively changing tendencies. Taking leading positions in confectionery market of Kazakhstan, company doesn't stop in a way to perfection. Factory increases capacities, production technologies are improved. Solid team of JSC “Bayan Sulu” always adequately responds to requirements of time and seeks to be one step away ahead of competitors.

Production

Large, constantly extending line of high-quality production of JSC "Bayan Sulu” offers confectionery for all tastes.

We offer your choice the whole set of the magnificent sweets meeting the highest requirements of the modern market. Company produces about 200 product names.

Quality

Careful control at all stages of production, allows reach excellent quality of production, considerably to increase terms of its storage.

Business reputation

High business reputation of the company is pledge of the strong partner relations with large producers and suppliers from Russia, Ukraine, Belarus, Germany, Poland, Netherlands, Denmark, Finland, Latvia, Lithuania, Israel, Holland and other countries. Faultless credit history speaks about high degree of responsibility and decency of Joint-stock Company. Company is the member of association of confectioners of Kazakhstan. Actions of JSC “Bayan Sulu” are included in the second category of sector of actions of the official list of JSC Kazakhstan Stock Exchange.

Sponsorship

JSC “Bayan Sulu” is the founder of TOBOL basketball club (Kostanay) – the numerous champion of Kazakhstan the prizewinner of the international competitions. Company renders the constant charitable help to children to orphans, is a patron the children's village of the family “Zhanuya”, and helps disabled people, special need citizens, and public organizations.

Social policy

We care of our employees. Comfortable conditions are created at the company for fruitful and effective work. We consider collective wishes and we do everything in order that the person had opportunity to develop and be improved, we support the initiative and in every possible way we accompany the professional growth of our people.

To competitors

We see healthy competition as a one of the major factors influencing market development, perfection of ready production and production improvement. Fresh ideas, conducted long-term plans can be born only in healthy competition conditions.

Bayan Sauda

“Bayan Sauda”LLP - official dealer of production of JSC Bayan Sulu has the developed, well debugged network of branches in the Republic that allows us to coordinate accurately production and deliveries of confectionery to the market of Kazakhstan.

2.2 Analysis of the financial statements of the jsc "Bayan Sulu"

Studies show that the basic information base audit is financial statements. Consider the financial statements of "Bayan Sulu".

JSC "Bayan Sulu" is one of the largest confectionery producers in Kazakhstan. The Company has more than 30 years experience in the industry, producing more than 200 kinds of confectionery, such as caramel, toffee, jelly beans, jelly, candy, chocolate, cookies, waffles.

JSC "Bayan Sulu" may carry out any activities not prohibited by the legislation of the Republic of Kazakhstan.

For its activities, has: office building, warehouse and industrial premises with modern equipment; there is road transport services for customers and clients.

JSC "Bayan Sulu" keeps records in tenge and prepare financial statements in accordance with the Law of the Republic of Kazakhstan. During the 2012 accounting was conducted in accordance with accounting standards, and then transformed the financial statements in accordance with IFRS.

Consider some of the financial statements in accordance with IFRS, working chart of accounts and accounting data digital JSC "Bayan Sulu". The first form of financial statements is the balance sheet (Form 1), consisting of five sections.

The first section is called Short-term assets.

These include cash and cash equivalents; short-term receivables; stocks; current tax assets; other short-term assets. We consider each of them.

1) Cash and cash equivalents.

IAS 7 "Statement of Cash Flows" given the following definition of cash, cash equivalents and cash flows:

- Funds include cash and demand deposits;

- Cash equivalents - short-term, highly liquid investments that are readily convertible to known amounts of cash and subject to an insignificant risk of changes in value.

According to the requirements of IAS funds are recognized in the balance line 010 "Cash and cash equivalents" on 31.12.2011 year - 174 280 thousand tenge, on 31.12.2012 year 15 758 000 tenge.

31.12.2011 at «Bayan Sulu" listed as cash:

- Money in current accounts in national currency - 77,605 thousand tenge;

- Money in current accounts in foreign currency - 92 771 thousand tenge;

- Cash on hand in the national currency - 3904 thousand tenge.

On 31.12.2012 at «Bayan Sulu" listed as cash:

- Money in current accounts in national currency - 2943 thousand tenge;

- Money in current accounts in foreign currency - 7206 thousand tenge;

- Cash on hand in the national currency - 5609 thousand tenge.

2) Short-term receivables.

Accounts receivable represent amounts due from customers for goods and services sold during the normal operational activities of the company. These accounts, also known as trade receivables, supported by invoices or other documents. Accounts Receivable include receivable within a year or following the carrying date or during operating cycle (depending on the fact that long). Usually considered a maturity period of 30 to 60 days, after which the accounts receivable are considered past due.

Receivables are recognized only when recognized associated income. It is measured at initial cost less adjustments for doubtful debts, cash discounts and rebates of goods sold. As a result, the net asset value is determined by the accounts receivable. Receivables from customers occur on advance payment or within the period specified in the contract for the sale of products and services.

This line of the balance sheet reflects the current portion of long-term receivables under finance leases (principal, VAT, interest on finance leases).

In line 012, "Short-term receivables" balance includes amounts payable in the table below.

Table 2.1.

Name of account	on 31.12.2011.		on 31.12.2012			2012 to 2011
	Sum, thousand tenge	Share of total,%	Sum, thousand tenge	Share of total,%	Absolute deviation, thousand tenge		Relative deviation,%
Short-term Accounts receivable from buyers	977713	94,19	389062	35,11	-588651		39,79
Short-term receivables of employees	6828	0,66	5254	0,47	-1574		76,95
Other short-term receivables	53474	5,15	54186	4,89	712		101,33
Current portion of finance lease receivables:
- Principal			396 267	35,76	396 267		-
- The amount of VAT			51 515	4,65	51 515		-
- remuneration			211 904	19,12
Total balance line 012	1038 015	100	1108 188	100	70173		106,76

Short-term receivables JSC "Bayan Sulu"

The share of receivables in total current assets amounted to 26.28%, an increase of 6.76% compared with the previous year. Obviously, receivables constitute a significant part of the current assets of the company, which in turn leads to slower turnover of working capital and adversely affects the financial position of the enterprise. The main part of receivables generated by debt buyers.

3) Inventories

In accordance with paragraph 4 of IFRS 2 "Inventories - are assets:

- Held for sale in the normal course of operations,

- During the manufacturing process for a sale or

- In the form of materials or supplies intended for use in

production process or the provision of services.

JSC "Bayan Sulu" as defined by IAS, on line 013 "Inventories" balance as of 31.12.2011 and 31.12.2012 are given in the table below.

Table 2.2.

Stocks of JSC "Bayan Sulu"

Name of account	on 31.12.2011		on 31.12.2012		2012 to 2011
					Absolute deviationthousand tenge	Relative deviation%
	Sum, thousand tenge	Share of total,%	Sum, thousand tenge	Share of total,%
Raw materials and supplies	708542	74,04	902141	35,27	193599	127,32
fuel	5524	0,57	5484	0,21	-40	99,28
Containers and packing materials	25198	2,63	30820	1,20	5622	122,31
spare parts	67400	7,04	102610	4,01	35210	152,24
Other materials	182	0,02	1392	0,05	1210	764,84
Materials transferred in processing			422	0,02	422	-
Building materials and other	23123	2,42	42154	1,65	19031	182,30
finished goods	76468	8,00	115 359	4,52	38891	150,86
goods purchased	18908	1,98	1305175	51,03	1286267	6902,77
Other products	31569	3,30	51928	2,03	20359	164,49
Total balance line 013	956914	100	2557485	100	1600571	267,26

Evaluation cost of inventories is made by weighted average cost.

Stocks investigated enterprise in 2012 compared to 2011 increased by 1,600,571 tenge (at 167.26%). This indicates that the company are stale and unnecessary materials, finished products, which are not in demand, excessive stocks of raw materials. This entails physical and mental aging, which in turn leads to losses. The largest share in the structure of reserves comprise goods purchased (51.03%), the lowest - materials submitted for processing (0.02%).

In the joint-stock company, a system of continuous (DC) excluding inventories, that is being reflected in the detailed balance sheet inventories incoming and outgoing inventory.

4) Other current assets

According to IAS 1 "Presentation of Financial Statements" on line 016 recognized term assets, which includes:

Prepaid expenses;

Advances paid for the supply of inventory;

Advances paid for the execution of works and services rendered.

Table 2.3.

Other short-term assets of "Bayan Sulu"

Name of account	on 31.12.2011			on 31.12.2012			2012 to 2011
							Absolute deviation thousand tenge		Relative deviation%
	Share of total, %	Sum, thousand tenge	Share of total,%		Sum, thousand tenge
Prepaid expenses	1217	0,15	2 338		0,54	1121		192,11
Short-term prepayments	829258	99,85	430 081		99,46	-399177		51,86
Total balance line 016	830475	100	432419		100	-398056		52,07

As the table shows, in 2012 there was a decrease in other current assets at 47.93% as compared with 2011. This is due to the decrease under short-term prepayments, which decreased by 48.14%. Thus there was an increase in prepaid expenses by 92.11%.

The second section of the balance sheet - long-term assets.

These include:

1) Investments accounted for using the equity method.

Subsection 2200 "Investments accounted for using the equity method" includes account:

2210 - "Investments accounted for using the equity method", which records transactions in investments in associated and affiliated companies accounted for using equity method.

The equity method - a method of accounting whereby the investments are initially recorded at cost and adjusted thereafter for the post acquisition change in the investor's share in the net assets of the investee.

Investments in associated companies as of 31.12.2011 and 31.12.2012 amounted to $ 30 thousand tenge.

Contribution to the charter capital of LLC "Credit Association" ABC "in the amount of 30 thousand tenge reflected in the balance sheet as a financial investment in line 020" Long-term investment. "

2) Long-term receivables

For long-term debt relates to settlements with buyers and customers for the sold assets and services rendered for over one year.

In JSC "Bayan Sulu" long-term receivables originated by the end of the reporting period under capital leases in the amount of 2,725,822 thousand Tenge.

In the balance sheet reflects the long-term accounts receivable under long-term lease with the exception of its current portion (on the repayment schedule):

- Principal 1,981,335 thousand tenge;

- The amount of VAT on principal 237 760 thousand tenge;

- Remuneration 506 727 thousand tenge.

3) Fixed assets

In accordance with paragraph 6 of IAS 16 "Property, Plant and Equipment" to fixed assets include tangible assets used by the company for the production or supply of goods and services, for rental to other companies for administrative purposes, to be used for more than one period. Objects are recognized as the main means of claim 7 IAS 16 "Property, Plant and Equipment" under two conditions:

- The presence of a high degree of confidence that the company will receive the asset's future economic benefits;

- Reliability of the cost of an asset for the company.

Valuation of fixed assets and their records are maintained at cost.

The fixed assets of the company accounted for the land, buildings, equipment, vehicles and other assets.

IFRS value of fixed assets in line 024 "Fixed Assets":

on 31.12.2011goda - 3,184,492 thousand tenge.

on 31.12.2012 - 1,722,689 thousand tenge.

Decrease in fixed assets was due to the fact that some of the equipment was transferred to the finance leases.

Now used straight (uniform) depreciation method. Depreciation - is the systematic allocation of the depreciable amount of an asset over its estimated useful life.

Accumulated depreciation is: at beginning of period - 477,754 tyyach.tenge and end of the period - 545 370 thousand tenge.

4) Intangible assets

In accordance with IFRS for the accounting for intangible assets is subsection 2700 "Intangible Assets". Intangible asset - an identifiable non-monetary asset without physical substance held for use in the production or supply of goods or services, for rental to others or for administrative purposes. This division includes the following group of accounts 2730 "Other intangible assets", which takes into account a group of assets of a similar nature and use in an organization:

- Software;

- Other intangible assets.

On derecognition of amortization of intangible assets used straight-line method.

In these financial statements for 2007 in accordance with IAS 38 "Intangible Assets" on line 027 to the balance value of intangible assets, net of accumulated depreciation.

5) Other long-term assets

Subsection 2900 "Other long-term assets" is intended to account for other long-term assets that are not mentioned in the previous sections and includes a subsection 2930 "Construction in progress". Under this subsection take into account costs for construction in progress related to the construction and reconstruction of facilities that will be used in the future in economic activity and will bring economic benefits in the future.

In accordance with IAS 16, the amount allocated to the construction in progress is reflected in the balance sheet on the line 029, which at the end of the reporting period amounted to 104 674 thousand tenge (building construction). Expenditure on reconstruction of buildings and buildings at the end of the reporting period amounted to 121 262 thousand tenge. Fuel landscaping amounted 351 thousand tenge. Equipment in the installation was 189 122 thousand tenge.

The third section of the balance sheet - short-term liabilities, which include:

1) Short-term financial liabilities

Subsection 3000 "Current financial liabilities" is intended to account for short-term financial liabilities with a maturity of up to one year, except for short-term debt and includes the following groups of accounts:

3010 - "Short-term bank loans," which takes into account their loans up to one year;

3050 - "Other current financial liabilities", which takes into account other short-term financial liabilities that are not specified in the preceding groups.

In JSC "Bayan Sulu" on this line balance is taken into account the current portion of long-term bank loans.

Under IFRS, the financial statements on a line 030 "Current financial liabilities" at the beginning of the reporting period, the number 1,584,929 thousand Tenge, at end of period - 1,431,560 thousand tenge.

2) Tax liabilities

Tax Code of the Republic of Kazakhstan "On taxes and other obligatory payments to the budget" requires the Company paying certain taxes.

After-tax they are recognized as a liability, and after payment - retired. Subsection 3100 "Tax liabilities" is intended to account for the company's obligations to pay taxes and includes the following groups of accounts:

3110 - "Corporate income tax payable," which takes into account corporate income tax payable;

3120 - "Individual Income Tax", which records transactions relating to the calculation and payment of individual income tax;

3130 - "Value Added Tax", which takes into account transactions relating to the calculation and payment of VAT;

3150 - "social tax", which records transactions relating to the calculation and payment of social tax.

In the financial statements on a line 031 "Tax liabilities" at the beginning of the reporting period, including 16 019 000 tenge at the end of the reporting period - 1754 thousand tenge.

3) Obligations under other mandatory and voluntary payments

Subsection 3200 "Obligations under other mandatory and voluntary payments" is intended to account for the mandatory and voluntary payments to be paid in accordance with the laws of the Republic of Kazakhstan, except for taxes.

This line takes into account the balance of arrears of pension contributions to pension funds and social security debts.

In the financial statements on a line 032 'Obligations under other mandatory and voluntary payments "at the beginning of the reporting period, the number 6 233 thousand, at the end of the reporting period - 7106 thousand tenge.

4) Short-term payables

Short-term payables occupies a significant part in the structure of balance sheet liabilities (25.84%), which confirms the high dependence of the enterprise on borrowed funds.

Subsection 3300 "Short-term payables" is intended to account payable within one year and includes the following groups of accounts:

3310 "Short-term payables to suppliers and contractors", which records transactions to suppliers and contractors for the assets acquired and consumed services, including shipping costs or processing stocks with a maturity of less than one year, and other accounts payable to suppliers and contractors; 3350 "Short-term debt to pay," which accounted for employee benefits to be paid in full within 12 months after the period in which the employees render the related service, and other short-term debt to pay; 3380 "Short-term benefits to be paid," where records transactions related to the presence and movement of accrued interest payable on loans received, issued securities and other short-term benefits to be paid; 3390 "Other current liabilities", which takes into account other short-term payables are not specified in the preceding groups.

In the financial statements on a line 033 "Short-term payables" at the beginning of the reporting period, the number 2,763,497 thousand Tenge, at end of period - 2,346,926 thousand tenge. A decrease in accounts payable at 15.07%. Debt reduction was primarily due to lower accounts payable to suppliers and contractors.

5) Short-term estimated liabilities

Joint stock company created a provision (provision for holiday pay) in accordance with IAS 19 "Employee Benefits". The amount of provision for vacation pay at the end of the reporting period amounted to 39 594 thousand tenge. The amount of accrued reserve is reflected in the statement of income and expenditure.

6) Other current liabilities

Subsection 3500 "Other current liabilities" is intended to account for other current liabilities not covered in the previous sections and includes account 3510 "Short-term advances received." On this account, accounted for advances received under the supply of goods, raw materials, services, and payment products produced for customers partial availability, and other short-term advances received.

This line reflects the balance sheet account 3520 "Deferred income", where recognized income recognized in the reporting period but relating to future reporting periods. Now reflected in the balance of current portion of long-term payables (liabilities) under capital leases in the amount of 263 418 thousand tenge.

Under IFRS, the financial statements on a line 035 "Other current liabilities" in the beginning of the reporting period, the number 324 096 thousand tenge, at end of period - 576 343 thousand tenge, including:

Table 2.4.

Other current liabilities of JSC "Bayan Sulu" for 2012

Name of account	on 31.12.2011		on 31.12.2012		2012 to 2011
					Absolute deviation thousand tenge	Relative deviation%
	Share of total, %	Sum, thousand tenge	Share of total,%	Sum, thousand tenge
Deferred revenues			263418	45,71	263418	-
Short-term advances received	324096	100	312925	54,29	-11171	96,55
Total balance line 035	324096	100	576343	100	252247	177,83

As the table shows, there is a general increase in other current liabilities on a 77.83%. This was due to an increase in deferred income.

The fourth section of the balance sheet - long-term liabilities. These include:

1) Long-term financial liabilities

This line of the balance sheet are taken into account the long-term financial liabilities, except for long-term payables.

This line includes the Joint Stock Company received long-term bank loans for over one year: at the beginning of the reporting period, the balance sheet listed 363 158 thousand tenge, at end of period - 2,384,274 thousand tenge.

JSC "Bayan Sulu" long-term foreign currency loans obtained in "Kazkommertsbank". Debt on credit outstanding at the end of the reporting period amounted to 3,815,834 thousand tenge, including current portion of long-term financial liabilities amounted to 1.43156 billion tenge.

2) Deferred tax liabilities

In line 043 of the balance sheet deferred tax liabilities accounted for deferred corporate income tax charged on profits and payable in future periods in respect of taxable temporary differences.

Taxable temporary differences - that the temporary differences that give rise to taxable amounts in determining taxable profit (tax loss) of future periods when the carrying amount of an asset or liability is recovered or settled.

For 2012 accrued corporate income tax.

Table 2.5.

Corporate income tax for the year 2012

tax	Sum, thousand tenge	Share of total,%
Income tax - current	57	0,08
Deferred tax - origination and reversal of temporary differences	72 626	99,92
Tax on profits	72 683	100

Deferred tax assets and liabilities are calculated in respect of temporary differences. Deferred income taxes are provided for all temporary differences between the tax bases of assets and liabilities and their carrying values ​​for financial reporting. A deferred tax asset is recognized only if it is probable that taxable profit, which may be reduced by the amount of deductible temporary differences. Deferred tax assets and liabilities are measured at the tax rates that are expected to apply in the period the asset is realized or the liability is settled, based on enacted tax rates.

3) Other long-term liabilities

Subsection 4400 "Other long-term liabilities" is intended to account for other long-term liabilities that are not mentioned in the previous sections and includes a 4420 account "Deferred income", where recognized income recognized in the reporting period but relating to future reporting periods. Now reflected in the balance of long-term liabilities under capital leases in the amount of 744 487 thousand tenge.

The fifth section of the balance sheet - Equity. This includes the:

1) Issued capital

In accordance with the Law of the Republic of Kazakhstan dated May 13, 2003 № 415 "On Joint Stock Companies" joint stock company is a legal entity issues shares to raise funds for its activities.

Authorized share capital of the company is equal to the total nominal value of authorized shares for issue, it is listed in the company's charter.

Amount of shares issued is recorded in the accounts of subsection 5000 "Issued capital" which is intended to account for the issued share capital and includes the following groups of accounts:

5010 "Announced capital", which takes into account the total nominal value of the issued ordinary shares paid by the Company;

5020 "Paid-in capital", which reflected the payment transaction issued shares.

Amount actually paid shares founders was 553,172 thousand tenge, including capital seized 4,236 thousand tenge. Movements on the shares during the reporting period was not.

2) Treasury equity instruments

Subsection is for treasury and equity instruments account 5210 "Treasury equity instruments", which takes into account the costs incurred by the acquisition of its own equity instruments.

In line 052, "Treasury equity instruments' balance includes amounts repurchased common shares at the beginning and end of the reporting period in the amount of 4236 thousand tenge.

One of the sources of own funds is a capital reserve. Established in accordance with the law, it is used to cover losses and dividend payments to shareholders and to be reported separately.

Subsection 5300 "Provisions" is intended to account for the reserves, which are recorded in equity in accordance with the requirements of Financial Reporting Standards and in accordance with the constituent documents and the accounting policies of the organization.

3) Provisions

In line 053 "Reserves" Balance at beginning of period reflects the amount of the reserve established by the legislation in the amount of 19 858 thousand tenge. During the reporting period the movement of reserves was not. At the end of the reporting period, in this line of balance amount of the reserve is 19 858 000 tenge.

4) Retained earnings

Retained earnings is the portion of equity that has not been distributed to the shareholders as dividends. To account for undistributed income provided subsection 5400 "Retained earnings (accumulated losses)."

In line balance 054 "Retained earnings" includes retained earnings of the reporting year in the amount of 131 812 thousand tenge. In the balance sheet reflects the retained earnings of previous years at the beginning of 2012 in the amount of 705,922 thousand and KZT 837,734 thousand as at the end of the year.

The second form of financial statements is the Statement of Income for 2012

Revenue from sales of products and services shall be defined by the value of sales of products and services: income is estimated with a high degree of reliability; it is probable that the economic benefits associated with the provision of the services are received.

Records of income being the accounts section 6 "Income".

Proceeds from the sale of confectionery products is recognized as shipping and receiving of finished goods buyer by selling prices. Revenue is recognized net of VAT and discounts. The amount of revenue is reduced by the discount on the price established in accordance with the contracts for wholesale buyers. Revenue from sales, accounting for decreases as the amount of the refund of goods sold. Revenue from the sale of purchased goods and services is determined by the fair value of the consideration received or receivable. If it is not possible to reliably estimate the fair value of the consideration received, the revenue is measured at the fair value of goods or services.

Revenues from other operations are recognized as follows:

• rental income - on an accrual basis;

• Other income - on an accrual basis.

JSC "Bayan Sulu" income received:

 Table 2.6.

Income received by JSC "Bayan Sulu" in the reporting period

Items of income	on 31.12.2011		on 31.12.2012			2012 to 2011
						Absolute deviation thousand tenge Share of total,%		Relative deviation% Sum, thousand tenge
	Share of total, %	Sum, thousand tenge	Share of total,%	Sum, thousand tenge
Revenues from the sale of confectionery	5729510	70,56	4719033	67,87	-1010477		82,36
Income from exports of confectionery	13176	0,16	-	-	-13176		-
Revenue from other sales	1531752	18,86	1882030	27,07	350278		122,87
Income from rent	185582	2,29	-	-	-185582		-
Total revenue from sales of products and services	7460020	91,87	6601063	94,94	-858957		88,49
Interest income	205315	2,53	-	-	-205315		-
Other income	454630	5,60	351664	5,06	-102966		77,35
Including:
Income from rent	20740	0,26	28399	0,41	7659		136,93
Exchange gain	410834	5,06	254648	3,66	-156186		61,98
Other income	23056	0,28	68617	0,99	45561		297,61
Total income	8119965	100	6952727	100	-1167238		85,63

For 2012 there is a decrease of business income to 14.37% compared to last year. The greatest decrease in the revenue structure is observed in foreign exchange gains (at 38.02%). At the same time, there proceeds from the sale of confectionery products by 17.64%. This indicates a decline in demand for the products investigated enterprise. Along with this increase can be traced items of income from other sales at 22.87%, is not related to the core business.

Expenses - decreases in economic benefits during the reporting period in the form of outflows or depletions of assets or incurrence of liabilities that result in decreases in equity, other than the reduction associated with the distributions of the persons participating in the capital. Designed for tracking expenses account section 7 "Expenses".

Table 2.7.

Expenses incurred by JSC "Bayan Sulu" in the reporting period.

Items of expenditure	on 31.12.2011			on 31.12.2012			2012 to 2011
							Absolute deviation thousand tenge		Relative deviation%
	Share of total, %	Sum, thousand tenge	Share of total,%		Sum, thousand tenge
Cost of sales and services rendered	6 403122	82,84	5753368		85,40	-649754		89,85
Selling and distribution costs of products and services	270484	3,50	299274		4,44	28790		110,64
Administrative expenses	290250	3,75	212494		3,15	-77756		73,21
Financing costs (interest on loans)	306742	3,97	156874		2,33	-149868		51,14
Other expenses	459290	5,94	314726		4,68	-144564		68,52
Including:
Foreign exchange losses	406520	5,24	232773		3,46	-173747		57,26
Other expenses	52770	0,70	81953		1,22	29183		155,30
Total expenditure	7729888	100	6736736		100	-993152		87,15

By the end of 2012 there is an overall cost reduction of 12.85% compared with the previous year. The largest decrease is observed in the article the cost of financing (at 48.86%). Also decrease administrative costs (26.79%), reduced costs under cost of goods sold and services rendered (10.15%). This is a positive point in the enterprise. However, at the same time, increased costs of finished products (at 10.64%). This may be due to difficulties in implementation: the fall of competitiveness of production and, consequently, and consumer demand.

At the end of the reporting period on account of income and expense accounts are closed for groups 5410 "Profit (loss) for the year."

Table 2.8.

Total profit gained at the end of the reporting period.

profit	on 31.12.2011		on 31.12.2012		2012 to 2011
	Share of total, %	Sum, thousand tenge	Share of total,%	Sum, thousand tenge	Absolute deviation thousand tenge	Relative deviation%
Profit before tax	204495	100	215991	100	11496	105,62
Corporate income tax	72683	35,54	57964	26,84	-14719	79,75
total income	131812	64,46	158027	73,16	26215	119,89

During 2012 there was an increase on the total income 119.89%. This suggests that there was a decrease in variable costs of producing products and services, which is a factor in increasing the profitability of business enterprises.

Thus, the basic information database audit is financial statements. Financial statements of "Bayan Sulu" on the 2012 is designed in accordance with the requirements of the Law of the Republic of Kazakhstan dated February 28, 2007 N 234 "On Accounting and Financial Reporting", Accounting Standards. Revised accounting policies in accordance with IFRS, guidelines on the application of international financial reporting standards and chart of accounts in accordance with IFRS.