The Concept of Productive Capital in Business Model Accounting and Integrated Reporting

Subject. This article explores the scope of the integrated reporting concept, which reflects the preservation of the value of production capital stock in the process of creating the value of a commercial organization.Objectives. The purpose of the article is to substantiate the hypothesis of preservation of the value of production capital, expressed in the business accounting model reflecting the processes of value creation and the influence on the stock of capital value. This statement of the problem is consistent with the concept of maintaining physical capital, as expressed in the conceptual framework of financial reporting.Methods. For the study, we used the methods of observation, abstraction, deduction and induction, stochastic and actual analyses of economic phenomena.Results. The study proves the need to distinguish between diametrically opposed accounting categories, such as wear and tear of fixed assets and depreciation of fixed assets. The first category should reflect the loss in the value of production capital stock. The second one should reflect the possibility of recovering financial losses, and the result of these accounting procedures should be reflected through the capital estimates.Conclusions and Relevance. The study concludes on the following: impairment of assets and liabilities is one of the methods of business model accounting, realized through the procedure of formation of fair value of assets and liabilities; the capital estimates reflect the possibility of maintaining the stock of the value of production capital when depreciation is considered as the possibility of financial capital to reimburse the value of losses in production capital. The approach proposed in the article to reflect accounting procedures related to the formation of capital estimates in financial statements not only corresponds to the concept of capital maintenance, but also allows to complete accounting records on reflecting the residual value of fixed assets.