To properly plan quality costs, you must be able to analyze the causes of defects and estimate the possible costs of eliminating them. Marriage refers to products that have a defect, that is, some kind of non-compliance with the requirements of technical documentation. Defects can be obvious, the identification of which is regulated by the relevant documentation, and hidden, the identification of which is not provided for by the documentation.

To account for defects, each enterprise uses its own or standard classifiers of defects by type, culprits and reasons.

Under type of marriage refers to specific defects and deviations from the established requirements for the quality of the material, the shape and size of the product, the accuracy of the location of surfaces, etc., which are the basis for its rejection and separation from the finished product. Distinguish fixable and irreparable marriage. A fixable marriage blanks, parts, units, assemblies or products with such defects are considered, the elimination of which is technically possible and economically feasible, which allows them to be used for their intended purpose without reducing quality requirements. If elimination of defects is impossible or economically infeasible, then such a defect is considered incorrigible or final. In addition, they highlight internal (in-plant) And external(outside the enterprise) marriage. External defects indicate both poor product quality and unsatisfactory work of control services. An external defect, formalized as a claim against an enterprise, is called complaint. Systematic filing of complaints causes the enterprise not only economic, but also moral damage, which, ultimately, can undermine the prestige of the enterprise.

For reasons, there are distinguished defects associated with violations of technological discipline, errors in technical documentation, malfunction of technological equipment and cutting tools, poor-quality composition of raw materials and materials, controller errors, etc.

According to the culprits, a distinction is made between defects caused by a worker, controller, technologist, designer or any specialist who developed poor-quality documentation for the contractor (Table 1.7). Correct recording and analysis of defects allows timely identification of its causes and specific culprits. Rational organization of production is unthinkable without the development of organizational and technical measures to ensure the prevention and elimination of defects, accounting for losses from defects and attributing them to the culprit, organizing work to correct or manufacture products to replace rejected ones. Marriage statistics are used to study and predict marriage dynamics possible reasons. All detected defects are identified and subject to removal and isolation in the appropriate compartments of the warehouse.

Table 1.7 Reject classifier

The culprits of the marriage	Marriage code	Reasons for marriage
Executing worker		Careless attitude to work
Adjuster worker		Poor equipment setup
Workshop administration		Non-standard storage and transportation of material
	Careless worker instruction
	Material grade does not meet the requirements
	Incorrect equipment setup
	Poor quality tools, dies, models
Chief Technologist Department		Errors in technical documentation
	Late change in technology
	Technological defect of equipment
Chief Designer Department		Errors in design
	Late correction of drawings
Technical control department		Skip marriage
	Untimely control
Chief Mechanic Department		Faulty equipment
External suppliers		Hidden defects

Analysis of defects and complaints is carried out in the context of individual reasons, culprits and types. As a result of the analysis, the following is determined: the number and percentage of defects for the enterprise and its divisions, losses from defects in standard hours or in monetary terms.

• 3 misconceptions when managing quality in an enterprise.
• Why should you not believe statements that it is impossible to get rid of defects in an enterprise without significant investments?
• How to group the causes of manufacturing defects.
• How to reduce defects in an enterprise: examples and recommendations from practitioners.
• How to reduce manufacturing defects by slightly changing production processes​.

Sometimes even the slightest defect in an enterprise can provoke a loss of raw materials and negatively affect the overall financial condition organizations. Manufacturing defect leads to other related problems. First of all, it is worth understanding why manufacturing defects occur and what are their main causes.

3 main misconceptions when managing quality in an enterprise

1. Only an organization can solve quality problems. Production managers and technologists at the enterprise quite often complain - they are forced to work with equipment that is already noticeably outdated. This circumstance is also used to justify defects in the enterprise, arguing that the purchase of new equipment will allow one to get rid of problems with product quality. However, not every enterprise has the resources to modernize, so this problem has to be postponed. From our own experience, we can say that in most cases it is possible to achieve modernization and increase in quality, with the establishment of more efficient production processes, without significant investments. And statistics confirm that often enterprises with the latest equipment in their industry face even more significant problems with product quality.

2. It is difficult to identify what exactly caused a defect at an enterprise - a typical response from technologists and production managers. From our own experience, we can say that for each group of similar cases of manufacturing defects, there is only one root cause. Its solution will prevent manufacturing defects in the future, even if secondary reasons remain.

3. It will take more than one year to eliminate the causes of marriage. A fairly common misconception - usually used to explain why systemic work is being carried out too slowly or not at all. However, practice confirms the Pareto principle - 20% of problems account for 80% of defective cases. By eliminating the most significant problems, it will be possible to significantly reduce the likelihood of manufacturing defects.

Motivation that will reduce the volume of production defects by 2 times

Ekaterina Sitneva, Director of the Magistral Printing House company, Moscow

When we realized that it was unprofitable to write off defects as costs, we began to look for ways to control and identify defects already at the production stage. The solution to the problem was improvement technological map– a document in which each employee registers his operation and signs.

When accepting an order, the manager enters the client’s wishes into the technical sheet, signs and transfers the document to the prepress department. The designer creates a layout (or changes the presented version) and also signs. Next, the map is checked by the head of the design department. The prepress stage ends with the layout being checked by a prepress specialist for compliance with the technical sheet and file requirements. The next stage is the department of the chief technologist. Here, the consumables necessary for production (paper, paint, braid, etc.) and a list of processes that are needed to produce products are entered into the map. The printing specialist makes required amount sheets, enters data into the card, signs. When the sheet is printed, it must dry, then it is cut, folded, and assembled onto a spring or staple. At this stage, the foreman comes into play - he looks at the sheets for defects, if there are no comments, he signs, and the product moves on. If a defect is detected at any site (or the client did not accept the order), then the technologist draws up a memo indicating the culprits and the reason. To resolve disputes, we assemble a commission that includes specialists from each stage of production. So it’s not difficult to identify an employee who committed a defect. We record all violations in a report, on the basis of which we make decisions on penalties. We offer the culprit to either pay for the marriage or work off an equivalent amount. Our task is not to fine the employee, but to develop the habit of treating their work responsibly, so the amount of compensation can be approximately 10% of the volume of defects (practice has shown that only after the introduction of financial liability did people think about what and how they were doing).

The level of manufacturing defects decreased from 14 to 7%. The costs of correcting defects have decreased and amount to no more than 5% of the volume of all products produced. We hope to reduce them to zero altogether. In addition, we ensured that employees began to consult with each other and with the technologist more often.

7 “lean” ideas that will save your company from defects

The introduction of lean manufacturing principles will help reduce the level of defects as much as possible. You will find seven ideas that you can apply in your company in the article of the electronic magazine "CEO".

Reasons for defects in enterprises and ways to deal with them

• find out where your low-quality raw materials come from;
• organize quality control at the stage of raw materials entering production;
• include a clause in the contract with suppliers regarding a significant fine if low-quality raw materials are discovered.

Equipment

• establish deadlines for maintenance and repair of equipment, as well as personal responsibility for violation of these deadlines and poor quality of work performed;
• track which unit produces each product. Then, if a defect is detected, you can easily identify the equipment that needs adjustment.

Production technology

• talk to the technologist and workers: they probably know which production methods are imperfect and lead to defects. Remember that any implementation new technology to reduce the volume of defects it must pay off;

Staff working conditions

• organize a collection of workers’ proposals to improve working conditions. The main thing is that these proposals are not forgotten, but implemented;

Unprofessionalism and irresponsibility of workers

• build a motivation system that is attractive to workers;
• oblige employees to stop work when receiving low-quality raw materials and notify their boss;
• implement automated process management systems to minimize the human factor.

Step-by-step algorithm for eliminating defects in an enterprise

First step. Make a table indicating all cases of defects in the enterprise. For illustrative statistics, we recommend analyzing data for at least a year.

Second step. We combine similar causes of manufacturing defects into a common group. By identifying a group of similar causes of marriage, it will be possible to calculate the number of cases during the period, as well as losses from them. (cm. table 2).


Third step. Conducting analysis. Usually, after grouping, it turns out that only a few identical causes are regularly repeated, leading to the bulk of manufacturing defects. They are the ones who deserve priority attention.

The fourth step is to select the cause of defects at the enterprise with the maximum number of cases and the greatest losses.

Fifth step – reduce or eliminate the likelihood of recurrence common reasons manufacturing defect.

In lean manufacturing there is a term poka-yoke(bye-bye, Japanese– error protection). This term implies: in order to prevent manufacturing defects in the future, it is necessary to ensure such conditions where it is physically impossible for the defect to be repeated, so that the employee does not have the possibility of making a repeated mistake, etc. Before solving the problem, our management often blamed subordinates, citing the problem of the human factor. However, improvement production process made it possible to radically reduce the likelihood of errors at the enterprise - fewer operations began to be performed in the mind, responsibility was delegated between different employees, and it was possible to improve favorable working conditions.

The sixth step is the development and implementation of a personnel motivation system aimed at reducing production defects. Possible measures include a certain amount of deduction for an employee for the production of each ton of defective goods, or for mistakes made. Bonuses can also be paid for reducing the percentage of defects to the established standard; individual indicators of employees can be posted on stands - this will stimulate the desire of employees to reduce the level of defects.

The seventh step is to organize a continuous quality improvement process. Individual quality indicators must be determined for each employee. As a rule, 1-3 indicators are enough. Then call your line managers every month and ask for data on these metrics. Each manager is required to provide a monthly report on the increase or decrease in employee performance, paying attention to the best employees, highlighting planned activities for the coming month. The manager gives grades to his employees. The work of line managers is also assessed by their superiors. Indicators of the best employees should be posted in prominent places, and incentives should be provided for distinguished employees.

With a correct analysis of cases of manufacturing defects, with an understanding of their causes, and work begun to eradicate them, it will be possible to expect a decrease in defects in the work of a medium-sized enterprise in the next 3-4 months.

How to reduce defects in an enterprise: examples and recommendations

Yuri Chinchik, Head of the quality and industrial safety service of the research and production company "Packer", Oktyabrsky

Our company specializes in the supply of small series of equipment to order. Among the main directions are thermal and mechanical (milling, turning) processing of parts and products. To reduce the percentage of defects, in 2006 we began to operate the “Diamond” system for millers, turners and assemblers - all shop workers. In fact, the defective part is presented by the employee himself who made the mistake.

After all, why is marriage allowed? The employee tries to hide his mistake so as not to face fines. The Diamond system assumes.

1. Incoming control. Each employee is required to evaluate the quality of the workpieces supplied to him for work. If it is immediately clear that it will not be possible to make a suitable part from this workpiece, he does not put it into production in order to reduce the cost of scrap.
2. Output control. The worker himself must check the quality of the completed part. If a defect is detected, he must report it; there will be no punishment.
3. Interoperational control. It is carried out by a controller, an employee of the quality control department. We operate small-scale production. To prevent the entire batch from being scrapped at once, the worker must show the controller the first part made - since this is where the probability of error is highest. In the future we plan to eliminate this practice of verification, but this will still require a complex preparatory work. It is noteworthy that when we carried out a survey on this issue, out of 40 employees, only two noted that additional control in their work was not needed.
4. Issuance of a personal stamp. For employees who always report a mistake or do not allow a defect at all, a personal mark is provided. In this case, the workers themselves act as a quality control controller, confirming the suitability of the products with their seal. Situations are possible when a brand is confiscated from an employee. The basis for granting a brand and its deprivation, the procedure for related procedures are specified in the instructions for employees.
5. The punishment is not for marriage, but for negligence. Despite all the loyalty, we still have certain sanctions in relation to our employees. If an employee presents a batch as good, but the controller or another employee identifies a defect, punishment awaits. But our punishment is not for the defect itself, but for the lack of proper product quality control and negligent attitude towards work. In this case, we deduct from the manufacturer the cost of the workpiece and the costs of the previous stages of processing.

Roman Lukyanchikov, General Director of the Moscow Windows company, Moscow

To reduce the share of defects and waste at the enterprise, a set of measures was introduced in production.

1. The machine park has been updated. Automatic production lines have been installed instead of manual machines. Such changes give confidence in the stable quality of products, reducing our dependence on the human factor. In particular, over the past 5 years we have managed to reduce the level of waste in the production of PVC profiles to 4.2% instead of the previous 7.5%. But to assess the effectiveness of equipment, one parameter is not enough. When modernizing, enterprises also sought to optimize their personnel, with an increase in automation and labor productivity, reducing the time for servicing machines. If we talk about the payback of equipment only taking into account savings on waste and defects, then it comes out to about 6 years.
2. Software preparation. Thanks to the complete automation of all work processes, it was possible to reduce the level of errors, with accurate accounting of working time and materials involved, with optimization of material waste during cutting. We are now working with our own software package, the development and update cycle of which lasted for ten years.
3. Work with people. An ideal result can only be achieved if each employee is personally interested in improving their work. Each stage of our production is assigned to a separate area. If a defect is detected at the production stage, there are no penalties for it. But if defective products are delivered to the customer, then we deduct 100% of the price of the product and the cost of re-delivery from the site where the defect occurred. Punishment is also introduced for the shift supervisor. There is a completely transparent system, so workers consider it fair, therefore they do not work with defective material, quickly responding to equipment failures - defects are absolutely not beneficial for them.

The total acceptable standard for defects is valid for each department. In the main production it is 4.25%. The level of irreparable defects (at which material costs are required for rework) should be no more than 0.35%. The remaining 3.9% accounts for cosmetic defects, when identified defects can be eliminated. For the installation department, the acceptable percentage of defects is 2.04%, for delivery - 1.58%, for measurements - 1.85%.

Pavel Menshikov, Chief Accountant of the management apparatus of the General Director of the Mostotrest company, deputy chief accountant of the Mostotrest company, Moscow

At the metallurgical enterprise, a “Black Box” system was introduced to record the activities of production shops. The goal of the new project was to reduce excess production costs. Each employee under the new system was required to follow the norm - from each 1 ton of semi-finished products received for processing, 0.94 tons of finished products should come out. Consequently, the workshop manager had the right to write off only 60 kg of waste. from 1 ton of metal (scale, waste, sawn-off edges).

To calculate the standard, a fairly simple principle was used - we took the percentages of scale and waste from industry standards, obtaining the acceptable percentage of trim experimentally by running the equipment.

New changes created comfortable conditions for quality management. Now, in a situation where the workshop manager expects to receive a bonus, compliance with the stated norm is required. When problems arise that threaten compliance with the standard, he has the right to clarify the issue with the production director. If there was a truly objective reason for the problem, assistance was provided to the workshop in solving it.

Result. It was possible to achieve an improvement in the situation in a short time. Previously, the level of losses at one of the workshops was over 100 kilograms per ton. In fact, the entire room was littered with defective products and scraps. The report indicated an exorbitant percentage of wastage - although it cited a fairly small percentage of defects. There were also constant manipulations with numbers - semi-finished products were accepted according to standard weight, but products were handed over according to actual weight. The new system involved the installation of scales at both exits; the changes made it possible to reduce the level of waste, which turned out to be even less than planned.

Advice. Before taking certain measures to reduce defects, it is necessary, first of all, to evaluate the economic impact of such changes. It is necessary to have reliable data, but it is with this issue that the enterprise often experiences problems. The solution to the problem is one way out - an information system introduced at the enterprise. It has proven itself to be highly efficient in the mass production segment. But we have to admit that we have practically no high-quality boxed solutions designed for automation production accounting. Consequently, you will need custom software development for your enterprise or adaptation of similar projects to your requirements.

Andrea Cuomo, director of production at the Extra M factory, Moscow

When my colleagues and I came to work from Italy at a Moscow plant, we discovered a high percentage of production defects: about 150 tons of pasta lying in the warehouse were intended for grinding. Having more than forty years of experience in pasta factories, I saw weaknesses both in the organization of the work process and in the settings of production lines. I started by conducting several training sessions for plant employees, explaining to them the basic principles of obtaining an ideal finished product: no rush, compliance with temperature conditions and constant monitoring. Then we implemented a set of changes.

1. The production cycle has been changed. Previously, the lines only produced the quantity of pasta that was specified in the order. It was necessary to restart the equipment, which led to significant energy costs. We have changed the production cycle: each production line now runs uninterruptedly for 72 hours, and undergoes mandatory cleaning once a week (before the changes were implemented, this was performed only as needed). This measure allowed to increase production volume (stocks are sent to the warehouse) and reduce energy costs. In addition, there was no longer a need to restart equipment for each new order.
2. Ensured stable temperature in the drying zone. When raw, pasta contains about 28–30% moisture, which must be gradually evaporated. To do this, it is necessary that the production areas have a stable temperature and no drafts. The duration of drying is also important - it is different for each type of pasta. For example, drying the most “capricious” pasta - spaghetti - can last for seven hours. The climate in Russia is colder and more changeable than in Italy, so we did the following: we installed special curtains made of PVC film at all entrances and exits of the workshops, which help maintain the temperature in the room. Currently, when production lines are operating, they can only be accessed from adjacent areas with a stable temperature.
3. We increased the time the product spent in the stabilization zone. Even if the products are perfectly dried, this is not a guarantee that there will be no defects. It is important to cool the pasta properly. If the product is packaged warm, perspiration will form inside, causing the package to swell or open. I increased the length of time the pasta was in the stabilization zone (a special sealed chamber that ensures rapid cooling of the product to room temperature). Previously, the presence of pasta in this area was not given due attention, but it was proper organization working at this stage ensures that the packaging is not deformed.
4. We started selling dough scraps. Dough scraps are natural production waste that is generated in the line after the paste is formed. Previously, these trimmings were equated to marriage. I believe that we need to treat raw materials more carefully, so now the trimmings coming out of the sterile line are not thrown away, but are sold to zoo farms near Moscow.

Increasing the operating time of the line allows you to save a significant amount of electricity every month and significantly reduce the volume of harmful emissions into the atmosphere. In addition, thanks to the restructuring of equipment, we were able to reduce losses of raw materials. With each die change and restart of the line, the first and last 5% of production are considered waste. By changing the cycle and reusing leftover dough, we reduced the loss of raw materials. Increasing the drying time of pasta and the product stabilization process, as well as monitoring the maintenance of optimal temperature in the production area, helped reduce the defect rate to almost zero.

CEO speaks

Konstantin Tsvetkov, General Director of the management company "Russian Sewing Concern", Severodvinsk

We operate a serial sewing enterprise. To reduce the level of waste and defects in our work, we use 2 methods.

1. Accurate calculation of the need for raw materials. All sewing production with a continuous sewing method requires a qualified engineer who can plan the needs of workshops for purchased raw materials, transferring the received data to the supply department.
2. Automated layout of patterns when cutting. We also bought the “Layout” module - automated workplace CAD "Comtens". The product has proven itself to be excellent for sewing production. In a matter of minutes, the computer performs the optimal layout of the patterns on the canvas. A particularly relevant solution if orders are placed from the enterprise and from third-party production facilities, with the provision of its own material. By adding a cutting machine to the Layout Module, it is possible to completely minimize the human factor.

Thanks to production automation, we were able to speed up the activities of technologists and designers, reducing waste by almost 20%.

An exception may be in individual and small-scale production, provided that the indicated losses relate to a specific order that has not been completed in production. When calculating the amount of losses from defects, only direct actual damage is taken into account. Unearned income is not taken into account. Direct actual damage is understood as loss, deterioration or decrease in the value of property, entailing the need for the tenant to incur costs for restoration, acquisition of property or other valuables, or to make excessive payments. If an enterprise has calculated losses from defects, this does not mean that all these losses can be included in the cost of products (works, services) and taken into account when taxing profits. When a defect is discovered, it is first necessary to identify those responsible for its occurrence (if any).

Accounting for defects in production

According to the decision of the head of the enterprise, 47,600 rubles will be withheld from the shift foreman. The average monthly salary of a master is 74,000 rubles. According to the Labor Code of the Russian Federation, the amount of monthly deductions from wages should be no more than 20% (74,000 × 20% = 14,800).

The following entries are reflected in the accounting: Description Dt Ct Amount, rub. The cost of defective parts is reflected 28 20 104 400 (47 600 + 39 400 + 17 400) Defective parts are capitalized at the price possible implementation 10.6 28 24 000 The amount that will be collected from the culprit - the shift foreman has been accrued 73 28 47 600 The amount in the first month has been withheld from the culprit's salary (posting is done every month until the debt is fully repaid) 70 73 14 800 Losses from defects are included in the cost of production 20 28 32,800 Analytical accounting on account 28 is carried out in the context of the product range, structural divisions of the enterprise, causes of defects, cost items and culprits.

• all of the above financial losses from external defects (except for the costs of replacing goods);
• expenses for repairing defective goods from the consumer (raw materials, supplies, equipment, employee benefits, etc.).

NOTE! From the final amount of losses, you need to subtract funds that can be returned: the ability to reuse unusable products or their elements, funds collected from suppliers for substandard raw materials, monetary sanctions in the event of agreed liability for defective products. Why defects may occur The reasons for the deviation of manufactured products from the relevant quality standards are different and relate to both objective and purely “human” ones.

1. Material problems. Low-quality raw materials will not be able to produce excellent products at the output.

Postings for manufacturing defects - account 28

What needs to be done from May 3 to 4 The first working week of May will last only two days. Many people even prefer to extend their personal May holidays through vacations and time off. Whether you're planning to go back to work next week or want to take a spring break break, check out our weekly accounting reminders.

This will make it easier for you to plan your work for the coming days and provide valuable instructions to your colleagues.< < … Зарплата за апрель: не ошибитесь в дате перечисления НДФЛ из-за May holidays This year, the first “portion” of the May holidays will last 4 days (from April 29 to May 2 inclusive). If your company's payday is the 1st or 2nd, you will have to pay the April salary early - on April 28th. On the same day, personal income tax must be withheld.< …

Write-off of defects: documents, reflection in accounting. reasons for marriage

The following entries are reflected in the accounting: Description Dt Ct Amount, rub. The cost of dublerin to eliminate defects is reflected 28 10 15 000 Salary and social benefits accrued. contributions for elimination of defects 28 70, 69 73 800 Written off of ODP related to elimination of defects 28 25 14 200 Accrued amount of claim to supplier 76.2 28 88 800 Reimbursement received from supplier of dublerin 51 76.2 88 800 Losses from defects included in the cost of semi-finished product 20, subaccount “Production” semi-finished product" 28 14 200 In the next example, consider the reflection of an internal irreparable defect. Example 2 Due to the inattention of the shift foreman when setting input data on the equipment, 120 pieces were produced.
low-quality metal parts. It is impossible to correct the shortcomings.

Accounting for defects in production

In February, the return of suits should be reflected in the following entries: D-62 – K-90-1 – 1,800 thousand rubles. (120 thousand rubles × 15) – using the “red reversal” method, sales revenue was reduced based on the buyer’s claim; D-t 90-2 – K-t 68-2 – 300 thousand rubles – VAT calculated on sales was reduced using the “red reversal” method; D-t 90-4 – K-t 43 – 1,200 (80 × 15) thousand rubles – the “red reversal” method reflects the actual cost of the returned suits; Dt 62 – Kt 51 – 1,800 thousand rubles – payment was returned to customers. Returned products do not have the appropriate presentation, but they can still be used for their intended purpose. Those responsible for the defect have not been identified, since it was difficult to identify this defect when laying the fabric.
In February, the costumes were marked down to the possible selling price - 60 thousand per unit, incl. VAT – 10 thousand rubles.

We write off the losses from the final marriage

Important

Defects in production lead to a decrease in the efficiency of resource use. Manufacturing defects are considered to be parts, components, semi-finished products, works, products:

• not meeting current standards or specifications;
• which can be used for their intended purpose only after additional costs for bringing them into compliance with standards or specifications, or cannot be used at all.

Accounting for defects in production for the purposes accounting made on account 28. A marriage at the place of its detection can be:

• internal (directly at the enterprise);
• external (after sale to the consumer or intermediary).

If it is possible to correct the defect, it is divided into:

• correctable;
• incorrigible.

The detected defect must be documented in an act, the form of which is approved by the management of the enterprise.

Accounting for defects in production - accounting entries

Account Dt Account Kt Description of posting Posting amount Document-basis 28 20.01 The cost of defects is written off 2000 Certificate-calculation, report on the occurrence of defects 10.01, 21, 41 28 Accepted for accounting are defective materials, semi-finished products, products at the price of their possible use 800 73.02, 76.05 ( 60.01).

• confirmed costs for correcting defects from the consumer;
• costs of transporting defective products;
• reimbursement of other buyer expenses associated with defective products.

If the defect is corrected by the manufacturer, it is accounted for during the correction time in off-balance sheet account 002.

Write-off of defective finished products in production at the expense of 94

D-t 90-8 (sub-account “Value added tax, calculated from other income from current activities”) – K-t 68-2 – VAT was calculated on revenue from the sale of discounted suits; Dt 90-10 “Other expenses for current activities” – Dt 10-6 – 750 thousand rubles – the book value of discounted suits is written off. For reference: the presence and movement of production waste, irreparable defects, materials received from the disposal of fixed assets that cannot be used as materials, fuel or spare parts in the organization, worn tires and scrap rubber, etc. taken into account in subaccount 10-6 “Other materials”. DAMAGE OF FINISHED PRODUCTS IN THE WAREHOUSE SHOULD NOT BE REFLECTED AS A PRODUCTION DAMAGE Finished products are products and semi-finished products that are fully processed, comply with current standards or approved technical specifications, accepted at the warehouse or by the customer for evaluation.

We talked about accounting for production costs in our consultation. We will talk about how production defects are reflected in accounting in this material. Accounting for defects in production: entries To summarize information about losses from defects in production, the Chart of Accounts and Instructions for its application (Order of the Ministry of Finance dated October 31, 2000 No. 94n) provides for account 28 “Defects in production”.

In the debit of account 28, costs for identified internal and external defects are collected. The account reflects both the irreparable defect and the costs of correcting the defect. Account 28 is credited for amounts that reduce losses from defects.

"Accountant Consultant", N 11, 2000

Correcting defective products identified during the production process entails non-production losses, which to one degree or another affect the overall results of the enterprise.

Depending on whether the accounting of defects and its documentation are properly organized, the enterprise can quickly determine the causes of defects, their size and the costs of correction, the analysis of which allows one to take measures to reduce production defects and eliminate circumstances that entail such non-production costs.

Concept and classification of defects in production

In accordance with clause 38 of the Basic Provisions for planning, accounting and calculating costs at industrial enterprises, approved by the Central Management System of the USSR, the State Planning Committee of the USSR, the State Committee for Prices of the USSR and the Ministry of Finance of the USSR dated July 20, 1970 N AB-21-D (hereinafter referred to as the Basic Provisions according to cost accounting), production defects are considered to be products, semi-finished products, parts, assemblies and works that do not meet the established standards or technical conditions in quality and cannot be used for their intended purpose or can be used only after correction.

Depending on the nature of the defects identified during technical acceptance, the defect is divided into correctable and irreparable (final).

Correctable defects are considered to be products, semi-finished products (parts and assemblies) and work that, after correction, can be used for their intended purpose and the correction of which is technically possible and economically feasible.

Final defects are considered to be products, semi-finished products, parts and work that cannot be used for their intended purpose and the correction of which is technically impossible or economically impractical, that is, the costs of producing new products, semi-finished products (assemblies, parts) to replace the defect are lower than the costs of its correction.

Based on the location of detection, defects are divided into internal, identified at the enterprise before sending products to consumers, and external, identified at the consumer during the assembly, installation or operation of the product.

Depending on what type the identified specific fact of defect in production will be classified, its assessment and reflection in accounting depends.

Evaluation of defects (costs of correcting them)

In accordance with the Basic Provisions for Cost Accounting, in general, the costs of correcting defects include the cost of ultimately rejected products (products, semi-finished products), the cost of materials, semi-finished products (parts) damaged during adjustment of equipment in excess of established standards, as well as the actual costs of correcting defects and costs for warranty repairs exceeding established standards.

The cost of internal final defects consists of actual costs for all direct cost items (materials, labor costs and contributions to state extra-budgetary funds), as well as costs for the maintenance and operation of equipment and shop expenses (utilities costs, etc. ).

The cost of internal correctable defects includes the costs of raw materials, materials and semi-finished products spent when correcting defective products, wages production workers, accrued for operations to correct defects with deductions for social insurance and security, as well as the corresponding share of expenses for the maintenance and operation of equipment and shop expenses (for enterprises with a non-shop structure - the corresponding share of general business expenses).

In general, the cost of external defects consists of the production cost of products (products) that are finally rejected by consumers, reimbursement to the buyer of the costs incurred in connection with the purchase of these products, the costs of dismantling the rejected products, as well as transportation costs caused by the replacement of rejected products, or from expenses for correcting defective products from the consumer, if they relate to correctable defects.

The cost of an external correctable defect consists of the costs of correcting the defect or a discount provided to the consumer as a result of the transfer of the supplied product to another grade or type of product to reimburse the buyer for the costs incurred in connection with the purchase of this product.

The cost of external defects of products finally rejected by the consumer consists of the production cost of the product, reimbursement to the buyer of the costs incurred in connection with the purchase of these products, as well as transportation costs caused by the replacement of rejected products.

To determine losses from internal and external defects, the following are subtracted from the cost of internal and external final defects:

• the cost of rejected products at the price of their possible use;
• amounts actually withheld from those responsible for the marriage;
• amounts of damages awarded by arbitration or actually collected from suppliers for the supply of substandard materials or semi-finished products.

Cost allocation

In accordance with clause 3 of the Regulation on the composition of costs, losses from defects are included in the cost of products (works, services).

It should be noted that the Regulation on the composition of costs does not provide for such a separate element of cost grouping as “losses from defects”, which means that it involves reflecting the costs of defects for each corresponding element of costs (material costs, labor costs, deductions for social needs, other expenses).

At the same time, industrial enterprises, as well as individual enterprises and organizations of the non-industrial sphere, form a separate cost element “losses from defects”, guided by clause 21 of the Basic Provisions for Cost Accounting, as well as industry instructions for planning, accounting and calculating costs in that or other industry.

Losses from internal defects in accordance with clause 99 of the Basic Provisions for Cost Accounting should be reflected in the costs of the month in which the defect was identified, and losses from external defects - in the month in which claims (complaints) of consumers (or they recognized by the judiciary).

Losses from external defects related to the main products produced in the previous reporting period are written off against the cost of the same products produced in the current reporting period. If similar products were not manufactured during the reporting period, losses from external defects are distributed among types of marketable products in the manner established for factory overhead expenses (or in any other procedure adopted by the enterprise).

The cost of internal defects is determined, as a rule, on the basis of actual, and in some cases - from planned or standard costs (this is especially typical for enterprises with mass production).

Losses from defects due to the low quality of materials or semi-finished products previously supplied by supplier enterprises and subject to recovery from them as compensation for damages (that is, losses from external defects) must be reduced by an appropriate amount after the claim is recognized by the suppliers or after the claim is satisfied by arbitration.

Accounted losses from defects are written off monthly to production accounts and included in the cost of the relevant types of products.

In individual and small-scale production, losses from defects in accordance with the Basic Provisions for Cost Accounting can be attributed to the cost of work in progress, provided that these losses relate to a specific order, the execution of which is not completed.

In all other cases, losses from defects are included in the cost of commercial products.

In appropriate cases, the cost of defects includes part of the costs of maintaining and operating the equipment. At the same time, the Basic Provisions for Cost Accounting propose to include such expenses in the cost of defects in proportion to the basic wages of production workers according to the standard ratio calculated when determining the estimated (normative) rates.

Remuneration and settlements with employees

In accordance with Article 91 of the Labor Code of the Russian Federation, when manufacturing products that turn out to be defective, workers are paid in amounts not lower than those established by law, depending on whether it is a complete or partial defect, as well as on whose fault the defect occurred.

The issues of remuneration are directly regulated by Article 93 of the Labor Code of the Russian Federation.

When manufacturing products that turn out to be defective through no fault of the employee, payment for labor for its production is made at reduced rates, while the monthly salary of the employee in these cases cannot be lower than two-thirds of the tariff rate of the category (salary) established for him. At the same time, the amount of payment may be higher if this is provided for in a collective agreement or employment contract (agreement).

Defects in products that occur as a result of a hidden defect in the processed material, as well as defects not due to the fault of the employee, discovered after acceptance of the product by the technical control body (other body), are paid to this employee on the same basis as suitable products.

In all cases, the employee’s monthly salary cannot be lower than the established one minimum size wages.

Example 1. An employee of the enterprise (5th category, piecework wage) produced 220 units per month. products.

The work is classified as 5th category, the price per unit of production is 17 rubles.

The employee delivered the products according to the order at the end of the month.

Upon acceptance of the products, a manufacturing defect was discovered, the cause of which was deficiencies in the technical documentation.

Due to the fact that there is no fault of the employee for a manufacturing defect, the products must be paid at reduced prices in the amount of at least 2/3 of the tariff rate of the corresponding category.

Based on this, the price should be at least 11 rubles. 33 kopecks (17 rubles x 2/3), and the monthly salary is not less than 83 rubles. 49 kopecks (i.e. the minimum wage), and not less than 2492 rubles. 60 kopecks (220 units x 11 rubles 33 kopecks).

Complete defects due to the fault of the employee are not subject to payment, and partial defects due to the fault of the employee are paid depending on the degree of suitability of the product at reduced prices, which are established by the administration of the enterprise.

In addition, due to the fact that the release of defective products entails direct losses for the employer, expressed in excessive consumption of raw materials, a decrease in labor productivity, and an increase in the cost of production, an employee may be held accountable for the damage caused to the enterprise in connection with the release of defective products through his fault. in the prescribed manner to financial liability with deductions from the wages accrued in his favor.

Moreover, in accordance with Article 124 of the Labor Code of the Russian Federation, deductions from wages to compensate for damage caused to the enterprise due to a manufacturing defect, on the basis of an order from the enterprise administration, are allowed only if the amount of such damage does not exceed the average monthly earnings of the employee. In addition, the order itself to make deductions must be made no later than two weeks from the date of discovery of the damage and must be executed no earlier than seven days from the date of notification of this to the employee (Article 122 of the Labor Code of the Russian Federation).

In cases where the damage exceeds the average monthly earnings of the employee, compensation for damage is made by filing a claim by the enterprise administration in the district (city) people's court.

In fact, the production of deductions from amounts paid to the employee can begin after the issuance of an order from the head of the enterprise for compensation of damages, while overall size deductions should not exceed twenty percent of the amounts accrued to the employee minus income tax.

In accordance with Article 126 of the Labor Code of the Russian Federation and 387 of the Civil Procedure Code of the Russian Federation, recovery cannot be applied to the following amounts:

• severance pay upon dismissal and monetary compensation for unused vacation;
• compensation payments in connection with a business trip, transfer, admission or assignment to work in another location; in connection with the wear and tear of tools belonging to the employee, and other cases provided for by labor legislation;
• bonuses of a one-time nature;
• state benefits for large and single mothers;
• benefits for the birth of a child, as well as funeral benefits paid by social insurance.

Example 2. Due to the fault of an employee of the enterprise, a partial manufacturing defect occurred.

A total of 100 units of products were rejected. Price per unit of production - 25 rubles.

Based on the results of an assessment of the possible use of defective products, the administration set a reduced price of 10 rubles.

The difference between the cost of possible use of the product and the actual costs (cost of material, the corresponding part of the costs of maintaining and operating equipment and shop expenses) represents the damage caused to the enterprise and it amounted to 850 rubles.

By order of the administration, the damage is subject to withholding from the employee.

In total for the current month the employee was accrued:

wages based on piece rates - 1000 rubles;

Reduced bonus for manufacturing defects - 100 rubles.

Total - 1100 rub.

For the three months preceding the month of damage to the enterprise, the employee’s salary amounted to only 7,800 rubles, and therefore the employee’s average monthly earnings amounted to 2,600 rubles. (RUB 7,800: 3).

Due to the fact that the amount of damage does not exceed the employee’s average monthly earnings, the administration’s order was issued legally.

The amount of deductions will be:

a) insurance premiums Pension Fund- 11 rub. (RUB 1,100 x 1%);

b) income tax - 91 rubles. ((1100 rubles - 11 rubles - 83 rubles 49 kopecks x 2 (non-taxable minimum per employee) - 83 rubles 49 kopecks x 2 (benefits for the maintenance of a minor child)) x 12%);

c) deductions for damages - 201 rubles. 80 kop. ((1100 rub. - 91 rub.) x 20%).

Total deductions - 303 rubles. 80 kop.

Payable in person - 796 rubles. 20 kopecks (1100 rubles - 303 rubles 80 kopecks).

In turn, the employee has the right, if deductions from his wages are made in violation of current legislation, or if he does not agree with the amount of deductions, to file a complaint with the labor dispute resolution body or file a claim in court.

In addition, for systematic defects, employees can be dismissed under clause 2 of Article 33 of the Labor Code of the Russian Federation due to “an employee’s discovered inconsistency with the position held or work performed due to insufficient qualifications” or clause 3 due to “systematic failure by an employee to fulfill duties without good reason assigned to him employment contract(contract)".

Documentation of marriage

For a final or correctable defect discovered in production in accordance with clause 99 of the Basic Provisions for Cost Accounting, the technical control department (another similar structural unit) draws up a report (defect notice), which reflects the volume of manufactured products or the number of suitable and rejected products.

A unified form of the marriage act has not yet been approved, and therefore the current document flow schedule at the enterprise provides for its own form of the act, approved by the head of the enterprise.

The marriage certificate is drawn up by the controller, foreman, foreman or other authorized officials and signed by the head of the workshop, the work foreman or other authorized person official. Employees guilty of producing defects must be familiarized with the defect report.

Based on the act, a calculation of defective products is drawn up, which indicates the total amount to be recovered from the guilty persons or organizations, and in the absence of such, attributed to production costs.

At some industrial enterprises, defects are recorded in cumulative statements or reports on rejected products, in which data on defects are entered, indicating the reasons and culprits for a week or half a month, or in primary documents for recording production, which provide the necessary indicators for this. To organize proper accounting of losses from defects and systematize information about defects at enterprises, a standard list of causes of defects and its culprits is established.

Raw materials, materials and purchased semi-finished products rejected during the production process due to the fault of the supplier are drawn up, in addition to the act, with a special document for filing claims against the supplier.

Any excess release of material for production, necessary to correct defects, is documented by issuing a special document. If third-party workers are brought in to correct a defect, then a work order is issued for such work in the general manner, on which a stamp or distinctive inscription “correcting a defect” is placed.

It should be noted that if to correct a defect that occurred through the fault of an employee, only their labor costs are required, then neither an act nor an order for correcting the defect is drawn up (issued), and the work itself is accepted from the employee guilty of the defect after correction.

Based on defect reports (or primary production accounting documents), a report is drawn up on the cost of defects in the reporting month, which determines the amount of losses from rejected products, indicating the types of products and those responsible for the defects.

The delivery of defective products to the warehouse is formalized by the requirement of an invoice (Form N M-11), the form of which is approved by Resolution of the State Statistics Committee of the Russian Federation of October 30, 1997 N 71a “On approval of unified forms of primary accounting documentation for accounting of labor and its payment, fixed assets and intangible assets , materials, low-value and wearable items, work in capital construction" (as amended and supplemented).

At the same time, in accordance with paragraph 52 of the Basic Provisions for Accounting for Materials at Enterprises and Construction Sites, approved by Letter of the USSR Ministry of Finance dated April 30, 1974 N 103, the preparation of documents for the delivery of defective inventories to the warehouse is assigned to the financially responsible person of the workshop ( area).

Accounting for losses from defects

In accordance with the Chart of Accounts (Instructions for using the Chart of Accounts), accounting for losses from defects is kept on account 28 “Defects in production”.

The debit of account 28 reflects the costs of identified internal and external defects (the cost of an irreparable, that is, final defect, costs of correction, etc.), as well as the costs of warranty repairs in an amount exceeding the norm.

The credit of account 28 reflects the amounts attributable to the reduction of losses from defects (the cost of rejected products at the price of possible use; amounts to be withheld from those responsible for the defects; amounts to be recovered from suppliers for the supply of substandard materials or semi-finished products, as a result of the use of which a defect occurred etc.), as well as amounts written off to production costs as losses from defects.

Accounting entries for accounting for correctable internal defects are drawn up as follows:

debit of account 28 credit of accounts 10 “Materials”, 25 “General production expenses”, 69 “Calculations for social insurance and security”, 70 “Settlements with personnel for wages” - materials spent on eliminating identified defects, accrued amounts of wages, deductions are reflected for off-budget funds for salaries, share of general production expenses;

debit of accounts 70, 76 “Settlements with various debtors and creditors” credit of account 28 - deduction of amounts from those responsible for the marriage.

Each fact of irreparable internal defect requires calculation of the costs of manufacturing defective products.

Based on these calculations, the calculated amounts of costs for producing defects are written off from account 20 to account 28 - debit account 28 credit account 20 “Main production”.

Thus, the costs of eliminating defects are collected, which, before they are written off to the cost of products (works, services), are reduced by amounts subject to withholding from those responsible for the defects or from suppliers of substandard materials or semi-finished products, as well as the cost of defective inventories at the price of their possible uses:

debit of accounts 10, 12 “Low value and wearable items”, 21 “Semi-finished products of own production”, 41 “Goods” credit of account 28 - defective material assets are capitalized at the price of their possible use.

In this case, an irreparable defect in production related to materials, in accordance with the Chart of Accounts (Instructions for using the Chart of Accounts), is reflected in the subaccount “Other materials” of account 10.

debit of account 73 “Settlements with personnel for other operations”, subaccount “Settlements for compensation of material damage” credit of account 28 - amounts to be recovered from employees who are responsible for the defect;

debit of account 63 credit of account 28 - amounts to be recovered from suppliers of defective materials, the use of which resulted in manufacturing defects (see explanations to account 28 of the Instructions for using the Chart of Accounts).

After reducing losses from defects by the appropriate amounts, the undistributed balance, recorded as the debit of account 28, is written off to the debit of the accounts:

20 “Main production” - costs of eliminating defects in the main production;

23 “Auxiliary production” - the costs of eliminating defects in the auxiliary workshops of the enterprise.

Example 3. At an industrial enterprise, there was an irreparable manufacturing defect in a whole series of products, the production costs of which amounted to 76,000 rubles:

debit of account 28 credit of account 20 - 76,000 rub.

The cost at which defective products can be sold is determined on commission at 30,000 rubles, in addition, in order to reimburse the costs of producing defective products, the amount of 5,000 rubles is subject to withholding from the culprits (members of the production team):

debit account 40 “Finished products” credit account 28 - 30,000 rubles;

debit of account 73, subaccount “Calculations for compensation of material damage” credit of account 28 - 5000 rubles;

debit account 20 credit account 28 - 41,000 rub. (76,000 rubles - 30,000 rubles - 5,000 rubles) - the non-refundable cost of irreparable defects is charged to the cost of products (works, services).

Example 4. At an industrial enterprise, there was a correctable defect in a batch of finished products, the production costs of which amounted to 76,000 rubles.

The following expenses were incurred to correct the defect:

debit account 28 credit account 10 - 6000 rub. - additional materials were consumed;

debit account 28 credit account 70 - 7000 rub. - additional wages were accrued to the workers involved in eliminating the defects;

debit of account 28 credit of account 69 - 2921 rub. (RUB 7,000 x 40.3%) - deductions to state extra-budgetary funds from labor costs (of which 1.8% is the tariff for compulsory social insurance against accidents at work and occupational diseases);

debit account 28 credit account 25 - 3000 rub. - the corresponding part of general production costs (expenses for the maintenance and operation of equipment) is allocated to the correction of defects;

debit of account 73, subaccount “Calculations for compensation of material damage” credit of account 28 - 5000 rubles. - deductions made from members of the production team guilty of production defects;

debit of account 20 credit of account 28 - 13,921 rub. (6,000 rub. + 7,000 rub. + 2,921 rub. + 3,000 rub. - 5,000 rub.) - non-refundable amounts of losses from defects are charged to the cost of production;

debit account 40 credit account 20 - 89,921 rub. (RUB 13,921 + RUB 76,000) - production cost of a batch of finished products.

In accounting, transactions involving external defects will be reflected as follows:

debit of account 62 "Settlements with buyers and customers" credit of account 46 "Sales of products (works, services)" (reversal) - restoration of amounts for the sale of defective products;

debit of account 46 credit of accounts 20, 26 "General business expenses", 40 "Finished products", 43 "Business expenses" (reversal) - restoration of the cost of defective products, general business (if the enterprise's accounting policy provides for the write-off of general business expenses directly to sales accounts) and commercial expenses for its implementation;

debit of account 51 credit of account 62 (reversal) - the amounts of sales revenue received are reversed;

debit of account 51 credit of accounts 62, 76 - restoration of debt to the buyer (customer) for further shipment in his favor of products that turned out to be manufacturing defects;

debit of account 28 credit of accounts 20, 25, 26, 43 - the costs of the enterprise for correcting external defects are reflected;

debit of account 28 credit of accounts 62, 76 - the enterprise’s debt to the customer for recognized additional amounts is reflected (for example, the customer’s costs for transportation and sales of products);

debit of accounts 70, 76 credit of account 28 - deduction of amounts from those responsible for the marriage;

debit of account 20 credit of account 28 - writing off final losses from defects to cost.

Settlements for claims for defects that arose through the fault of suppliers or contractors of substandard materials or semi-finished products, which resulted in defects in the amounts recognized by the defendants or awarded by arbitration, in accordance with the Chart of Accounts (Instructions for using the Chart of Accounts) are drawn up through account 63 "Calculations on claims."

In general, the following transactions are made for account 63:

debit of account 63 credit of account 28 - the reduction in the cost of eliminating external defects includes amounts due from defendants and suppliers for their supply of substandard materials or semi-finished products, as a result of which the use resulted in defects (see explanations to account 28 of the Instructions for using the Plan accounts);

debit of account 51 credit of account 63 - receipt of payments;

debit of accounts 20, 23 credit of account 28 - write-off of balances of losses from defects (including amounts of claims and claims not recognized by suppliers and the court).

It should be borne in mind that losses from defective products produced in previous years are not included in the losses of previous years to be reflected in account 80, but are reflected in the generally accepted manner as part of the cost of products (works, services).

Analytical accounting for account 28 is carried out for individual workshops of the enterprise, types of products, expense items, causes and culprits of defects.

As noted above, account 28 also takes into account the costs of warranty repairs in excess of the norm (explanations for account 28 of the Instructions for using the Chart of Accounts). At the same time, on the basis of clauses 3 and 10 of the Regulation on the composition of costs, costs for warranty repairs and warranty service of products for which a warranty period is established are included in the cost of products (works, services) under the element “other costs”.

In this regard, all amounts of warranty service costs are taken into account in two ways:

debit of accounts 20, 26 credit of accounts 10, 60, 69, 70, 76 - costs of warranty repairs and maintenance within the limits of warranty standards;

debit of account 28 credit of accounts 10, 60, 69, 70, 76 - costs for warranty repairs and maintenance in excess of warranty standards (explanations for account 28 of the Instructions for using the Chart of Accounts).

Reflection in the accounting records of an enterprise of settlements with suppliers for supplied defective inventories

As noted above, the cause of a manufacturing defect can also be a defect in materials, semi-finished products and other inventories supplied by suppliers.

In such cases, calculations for claims made to suppliers should be properly organized and recorded in accounting.

According to current legislation, the buyer must accept the products and check their quantity and quality within the time frame stipulated by the contract. If upon acceptance of products defective products are discovered, the buyer is obliged to notify the supplier about this.

The instructions on the procedure for accepting industrial and technical products and consumer goods by quantity were approved by Resolution of the State Arbitration Court under the USSR Council of Ministers dated June 15, 1965 N P-6 (as amended by Resolutions of the USSR State Arbitration Court dated December 29, 1973 N 81, dated November 14 1974 N 98), and the Instruction on the procedure for accepting products for industrial and technical purposes and consumer goods in terms of quality - by Resolution of the USSR State Arbitration Court of April 25, 1966 N P-7 (as amended by the Resolutions of the USSR State Arbitration Court of December 29, 1973 N 81, dated November 14, 1974 N 98).

In accordance with Article 475 of the Civil Code of the Russian Federation, the buyer has the right to demand from the seller:

• proportionate reduction in the purchase price of products;
• free elimination of its shortcomings;
• reimbursement of their expenses for eliminating deficiencies.

In addition, in the event of delivery of defective products with significant defects, the buyer has the right to refuse to fulfill the contract or demand replacement of defective products.

The procedure for recording transactions in each specific case depends on the decision made by the buyer, as well as the time of detection of defects in the supplied products (at the stage of product acceptance, during storage, during transfer to production).

If the buyer enterprise requires a reduction in the purchase price of products at the stage of acceptance of products, the receipt of such products is carried out at lower prices than stipulated in the contract.

When the parties reach an agreement on the elimination of deficiencies by the supplier, the buyer, before eliminating such comments and final acceptance of the products, reflects them on off-balance sheet account 002 “Commodity - material assets accepted for safekeeping,” and after eliminating the deficiencies, the products arrive at negotiated prices.

If the costs of eliminating the defects were borne by the buyer company itself, it has the right to demand reimbursement of such costs from the supplier. In this case, the amount of the claim is reflected in account 63 in correspondence with cost accounts (materials, calculations for wages and contributions to state extra-budgetary funds, etc.).

If there are significant defects in the delivered products, the buyer has the right to refuse to fulfill the contract or demand replacement of products of inadequate quality with new products. Moreover, if product defects are discovered at the stage of its acceptance, then the cost of the product is reflected in off-balance sheet account 002, and the amount of payment (if it has already been made) is applied to settlements of claims.

In addition, in all cases, the consumer also has the right to demand full compensation for losses caused to him as a result of the sale of goods of inadequate quality.

Example 5. The manufacturing enterprise accepts products (materials) supplied by the wholesale trading enterprise. In total, materials worth RUB 120,000 are supplied under the contract, incl. VAT 20% - 20,000 rub.

At the acceptance stage, defective materials are identified.

The buyer company has the right:

1. Demand a reduction in the purchase price of materials - for example, to 96,000 rubles:

debit of account 10 credit of account 60 - 80,000 rubles - cost of materials;

debit of account 19 “Value added tax on acquired assets” - 16,000 rubles. - VAT on the cost of materials;

debit account 60 credit account 51 - 96,000 rub. - payment of the cost of materials.

If an advance was previously issued, it is offset in the following order:

debit of account 60 credit of account 61 “Calculations for advances issued” - 96,000 rubles. - advance payment is credited towards payment for materials supplied at reduced prices;

debit of account 63 credit of account 61 - 24,000 rub. (120,000 rubles - 96,000 rubles) - the difference between the advance amount issued and the cost of materials at reduced prices is attributed to claims settlements;

debit account 51 credit account 63 - 24,000 rub. - the supplier satisfied the company’s claim.

1. Demand that product defects be eliminated:

debit of account 002 - 120,000 rub. - cost of materials received;

account credit 002 - 120,000 rub. - write-off of materials from off-balance sheet accounting after the supplier eliminates deficiencies;

debit account 10 credit account 60 - 100,000 rub. - materials were capitalized after the deficiencies were eliminated;

debit account 19 credit account 60 - 20,000 rub. - VAT on the cost of materials;

debit of account 60 credit of accounts 51, 61 - payment of the cost of materials (previously issued advance payment is offset).

1. Demand reimbursement of costs to eliminate product defects:

debit of account 63 credit of accounts 60, 69, 70, 76 - reflects the costs of eliminating product defects identified during acceptance;

debit of account 51 credit of account 63 - satisfaction by the supplier of the claims of the enterprise - buyer.

1. Refuse to perform the contract:

debit of account 002 - 120,000 rub. - off-balance sheet accounting reflects the receipt of products, upon acceptance of which significant deficiencies were discovered;

debit of account 63 credit of accounts 60, 61 - 120,000 rub. - claim for the amount of substandard products supplied;

debit of account 63 credit of account 80 - claim for the amount of losses;

account credit 002 - delivered products are transferred to the supplier;

debit of account 51 credit of account 63 - satisfaction by the supplier of the claim of the enterprise - buyer.

1. Request replacement of the supplied defective products:

debit of account 002 - the cost of poor-quality products received is credited to an off-balance sheet account;

account credit 002 - products are transferred back to the supplier;

debit account 10 credit account 60 - 100,000 rub. - receipt of a new batch of products to replace poor quality ones;

debit account 19 credit account 60 - 20,000 rub. - VAT on the cost of newly supplied products;

debit of account 60 credit of accounts 51, 61 - payment for delivered products (previously issued advance payment is offset);

debit of account 63 credit of account 80 - claim of the enterprise - buyer for the amount of losses;

debit of account 51 credit of account 63 - satisfaction of the claim by the supplier company.

If defective products are identified after its acceptance, recording and before its transfer to production (before its sale), its cost is written off to accounts for settlements of claims in the following order:

debit of account 63 credit of accounts 10, 12, 41 - the accounting value of defective products is reflected;

debit of account 68 “Settlements with the budget” credit of account 19 (reversal) - the amount of VAT previously presented for offset from the budget is reversed;

debit of account 63 credit of account 19 - reversed VAT amounts are attributed to the claim against the supplier company;

debit of account 63 credit of accounts 69, 70 - the buyer's claim includes its costs for eliminating identified defects.

Accounting registers for losses from defects

The amounts of losses from defects are reflected in statements N N 12 and 14.

Each fact of defect requires calculation of the costs of manufacturing defective products. Based on the act in which such costs are calculated for individual items, the data from it is transferred to statement No. 14 “Record of production losses”.

In Statement No. 14, a separate table is provided for calculating and accounting for losses from defects, which shows the total amounts of losses, the amounts of their partial compensation, as well as the final amount of losses. The total amounts of losses are shown by the main types of costs, from which these losses are added up in relation to the items accepted in the calculations of the cost of marketable products.

The amounts of final losses (by workshop), calculated in statement No. 14, are reflected in statement No. 12, from which these amounts, in turn, are transferred to the journal - order No. 10.

Accounting for losses from defects and their documentation at enterprises of certain economic sectors

Accounting and documentation of losses from defects have their own characteristics in certain sectors of the economy.

Construction

Defects in construction include the costs of redoing poorly executed construction work due to the fault of the construction organization (that is, performing work in violation of technical specifications, SNIP or design solutions), as well as the costs of eliminating damage to previously completed parts and structures of buildings and structures that occurred during subsequent production of work, as well as the cost of ultimately rejected work.

The following do not apply to defects in construction:

• costs of eliminating defects in construction that arose through the fault of the customer and were paid by him;
• the cost of incorrectly labeled building materials, products and parts, as well as building materials, structures and parts manufactured by construction organizations or other organizations, the unsuitability of which was discovered at the construction site.

Losses from defects in construction organizations are accounted for in account 28 separately for defects that occurred during construction work and defects that occurred in auxiliary production, according to construction projects and types of auxiliary production, respectively.

The detected defect is documented in a report drawn up by employees of construction laboratories, quality engineers or persons in accordance with construction contracts.

The costs of correcting defects made during construction work reflect the cost of:

• additionally consumed materials;
• expenses for remuneration of workers for disassembly, dismantling and other additional work performed in connection with the elimination of defects;
• expenses for operating construction machines and mechanisms used to correct defects;
• part of the overhead and costs associated with correcting defects by third parties.

The amount of costs for correcting the defect is reduced by the amounts attributed to suppliers and subcontracting construction organizations (if they admitted their guilt), by the amounts reimbursed by the persons who committed the defect, as well as by the cost of materials capitalized during disassembly and dismantling at prices of possible use.

The difference between the costs of correcting defects and the amounts reimbursed represents losses from defects incurred during construction work, and is included in the cost of work on construction projects on a direct basis, distributing them according to the relevant cost items (elements).

Losses from defects identified on objects commissioned in the reporting year, in accordance with clause 4.35 of the Standard methodological recommendations on planning and accounting for the cost of construction work, approved by the Ministry of Construction of Russia on December 4, 1995 N BE-11-260/7, increase the cost of work on these objects, and on objects put into operation in previous years, they are charged to the account when an appropriate reserve is formed 89 “Reserves for future expenses and payments”, and in its absence - to account 80 as losses on operations of previous years identified in the reporting year.

Oil refining (petrochemical) industry

In accordance with clause 3.43 of the Instructions for planning, accounting and calculating the cost of products at oil refining and petrochemical enterprises, approved by Order of the Ministry of Fuel and Energy of the Russian Federation dated November 17, 1998 N 371 (as amended on October 12, 1999), in oil refining and petrochemicals Manufacturing defects are generally considered to be those products or semi-finished products that do not meet established quality standards or technical specifications and require additional (re)processing to correct them.

Additional costs for in-plant pumping are also considered losses from defects.

Along with losses from defects corrected through additional processing, the oil refining industry identifies losses from unscheduled injections of petroleum products that arise in the following cases:

a) mixing a product of higher quality and value with a non-standard petroleum product to improve the quality of the latter;

b) when pumping non-standard products into raw materials, heating oil and other less valuable petroleum products;

c) due to other injections of more valuable petroleum products into less valuable ones (when pumping pipelines, washing tanks, lack of capacity and for other reasons).

The amount of losses from unscheduled injections of petroleum products is determined by multiplying the difference in prices of blended petroleum products by the number of tons of higher quality petroleum products.

The amount of these losses is not taken into account in production costs, since these losses do not represent an increase in production costs, but a decrease in revenue from sales of products due to a decrease in its grade due to unscheduled mixing of petroleum products.

Agriculture

Production defects in agriculture are determined at subsidiary enterprises (mill, bakery, salting point, etc.). Losses from defects are reflected in the second section of the “product processing report” (form N SP-28, approved by Resolution of the State Statistics Committee of the Russian Federation of September 29, 1997 N 68 “On approval of unified forms of primary accounting documentation for the accounting of agricultural products and raw materials”).

At the end of the reporting period, in accordance with the document flow schedule, the report, together with the primary documents, is submitted to the accounting department to reflect transactions in the relevant accounting registers. The second copy of the report remains with the production manager.

Veterinary defects in meat are reflected in the “production report on poultry processing and product yield” (form N SP-56).

Publishers

In accordance with clause 1.2.16 of the Instructions for planning, accounting and calculating the cost of products at publishing enterprises, approved by Order of the Ministry of Information and Printing of the Russian Federation dated December 28, 1993 N 259 (the Order is advisory in nature), losses from defects in publishing organizations include costs for correction of publications due to the fault of the publisher, in particular, rips, pastings, typos, typesetting, etc., with the exception of amounts reimbursed in accordance with the established procedure.

The marriage is formalized by a deed attached to the invoice, which is approved by the publishing house. In the act, in addition to describing the essence and reasons for the marriage, they indicate who allowed it, from whom and what amounts are to be collected and which should be attributed to the cost of a specific order.

Accounted losses from defects from the credit of account 28 are debited to account 20 in the part that falls on the cost price, and the amounts subject to withholding are to accounts 76, subaccount "Settlements with authors and artists", 63 and 73.

Printing enterprises

In accordance with clause 4.33 of the Instructions for planning, accounting and calculating the cost of products at printing enterprises, approved by Order of the Ministry of Information and Printing of the Russian Federation dated March 4, 1993 N 31 (the Order is advisory in nature), losses from defects in production include:

• the cost of ultimately rejected products and work performed by production workers (manual and machine typing, layout, production of matrices and stamps, casting and finishing of fonts, printing, production of binding covers, brochures and other works);
• costs of correcting defects at all stages of production, including wages of repair crew workers and other costs of eliminating defects in finished products or semi-finished products;
• costs for secondary reproduction of rejected semi-finished products, products and works, including the cost of re-typesetting or production of a printing form.

A final or correctable defect discovered in production is documented in a marriage certificate.

Defects in materials and purchased semi-finished products due to the fault of the supplier, discovered during the production process, are drawn up in addition to the act with a special document for presenting claims to the supplier. The procedure for registering defects due to the fault of suppliers and filing claims (complaints) against them is carried out in relation to specific conditions in accordance with contracts for the supply of materials, semi-finished products and products.

The first copy of the act is transferred to the accounting department to calculate the cost of the defect, determine losses and recover them from the culprits; the second copy - to the production department; the third - remains in the workshop that allowed the defect.

Ferrous metallurgy

In accordance with paragraph 60 of the Methodological Guidelines for planning, accounting and calculating the cost of products at ferrous metallurgy enterprises, approved by Roskommetallurgy on December 7, 1993 (the document is advisory in nature), classifying products as defective at ferrous metallurgy enterprises is carried out on the basis of acts of the technical control service and reports (reports) of workshops on production.

Internal defects at industry enterprises include:

• defects discovered in the manufacturing workshop (including defects due to production stops during downtime);
• defects discovered in other departments of the enterprise during processing or processing;
• a defect found in a company's warehouse.

Product defects detected in the manufacturing workshop, in other workshops, in the warehouse and from customers are excluded from the release of finished products in the month in which this defect was discovered or the customer’s claim was recognized, regardless of the time of its production. A defect restored to a suitable product is included in the production output in the month in which it was restored to a suitable condition.

The amount of losses from defects excluded from production is determined by multiplying the difference between the average workshop cost of a ton of rejected products and the cost of a ton of defects at a set price by the number of tons of defects and subtracting from the resulting amount deductions from those responsible for the defects and the amount of compensation for damages awarded by arbitration or actually collected from suppliers for the supply of substandard materials or semi-finished products, resulting in defects.

The workshop cost used to calculate losses from defects is determined by excluding from the production cost the costs of preparation and development of production, other production and general business expenses.

For defects detected among buyers, losses consist of:

• losses in the production of such rejected products;
• losses for transportation of defective goods and reimbursement to the consumer of expenses incurred.

In this case, losses consisting of amounts for reimbursement of the railway tariff or water freight paid by the sales organization or the buyer for delivered defective products, payment of the railway tariff (water freight) when returning products, reimbursement to the buyer of expenses incurred by him on rejected products are charged to account 28 from the accounts with consumers.

According to paragraph 64 of the Methodological Instructions, the cost and cost in wholesale prices of products rejected by the buyer (in the same year in which they were produced) are reversed in accounting:

1. For products paid for by customers:

• in terms of the cost of rejected products - by the debit of the sub-account "Sales of finished products and industrial works" of account 46 and the credit of account 45 "Goods shipped", and at the same time by the debit of account 45 and the credit of account 40;
• in terms of the cost of rejected products in wholesale prices - by the debit of account 51 "Current account" and the credit of the subaccount "Sales of finished products and industrial works" of account 46 (the cost of rejected products in wholesale prices, withdrawn from account 51, is restored to this account from the credit settlements with customers).

1. For products not paid for by customers - debit account 45 and credit account 40.

Losses from external defects related to products rejected in the reporting year, but produced last year, are reflected in accounting from the accounts with customers in the following order:

a) the difference between the cost in wholesale prices and the full cost of the corresponding period is charged to account 80;

b) the full cost of the rejected products, together with all expenses reimbursed to the buyer, is written off to account 28.

In turn, the cost of defective products at the price of possible use, deductions from those responsible for the defects and losses from defects from the credit of account 28 are charged to the appropriate accounts.

Accounting and reporting of defects is carried out in accordance with the current classification according to the reasons for its occurrence (separately for each workshop and for the enterprise as a whole), as well as by the culprits of the defect.

Catering establishments

In accordance with the Methodology for accounting for raw materials, goods and production in mass catering enterprises various forms property approved by the Industry Center for Advanced Training of Trade Workers of the RF Committee on Trade on August 12, 1994 N 1-1098/32-2 (the document is advisory in nature), settlements of public catering enterprises with suppliers of substandard products are reflected in accounting in the following manner:

debit of account 63 credit of account 41 - filing claims with suppliers for shortages and defects of products and goods that occurred through their fault, as well as for deterioration in quality, if the circumstances justifying the claim were identified after the products were posted (at the cost of purchase);

debit of account 42 "Trade margin" credit of account 41 - for the amount of the margin on missing and damaged products and goods;

debit of account 44 “Distribution costs” credit of account 84 “Shortages and losses from damage to valuables” - attribution to distribution costs of written-off products and goods based on shortages (damage) identified upon acceptance from suppliers and transport organizations within the limits of natural loss norms (at the cost of acquisition) ;

debit of account 63 credit of account 41, subaccount “Containers under goods and empty” - filing claims with suppliers for shortages and defective packaging that occurred through their fault, as well as for a decrease in quality identified after the packaging was posted (at the cost of acquisition);

debit of account 84 credit of account 60 - for the shortage (damage) of products and goods identified during acceptance in excess of the norms of natural loss during transportation through the fault of the financially responsible person (forwarder, commercial agent, etc.) at the cost of purchasing the missing products and goods;

debit of account 73, subaccount “Calculations for compensation of material damage” credit of account 84 - transferring to the accounts of financially responsible persons the missing products and goods damaged through their fault during transportation (at the purchase price);

debit of account 73, subaccount “Calculations for compensation of material damage” credit of account 83, subaccount “The difference between the amount to be recovered from the guilty parties and the book value for shortages of valuables” - the amount of the markup to be withheld from the guilty persons;

debit of account 80 credit of account 84 - the amounts of claims that were rejected by arbitration (court) are written off to financial results.

Selected tax issues

In accordance with Letter of the Department of Tax Policy of the Ministry of Finance of Russia dated December 25, 1997 N 04-03-11, when returning to the supplier a registered and paid product, including defective goods, with this operation reflected through account 46, an invoice is drawn up by the enterprise in the generally established manner, as the seller of this product, with all the details of this invoice reflected in the sales book.

If the return of defective goods is not made in full and bypassing account 46, new invoices are not issued, and the defective goods are returned on the basis of invoices, and on the original invoice remaining with the retail enterprise, and appropriate corrective entries are made in the purchase book .

When calculating income tax, it should be taken into account that in accordance with the Methodology for calculating the deflator index for indexing the value of the sold property of enterprises, approved by the State Statistics Committee of the Russian Federation, the Ministry of Economy of the Russian Federation and the Ministry of Finance of the Russian Federation on May 21, 27, 1996, the deflator index is used, including, and when selling an irreparable defect, in particular, material assets received from the disposal of fixed assets that cannot be used as materials; fuel or spare parts (scrap metal, waste materials).

1) Depending on the nature of the defects, marriage is divided into correctable and irreparable (final).

Non-refundable amounts of losses from defects are included in the cost of those types of products for which defects are detected. If in the period in which a defect was detected, this type of product was not produced, then the amount of losses from defects is distributed by type of product as general production expenses.

The cost of internal irreparable defects, subject to reflection on account 28 “Defects in production”, is determined by the amount of costs for the manufacture of defective products, which includes:

· cost of raw materials used;

· labor costs;

· corresponding amounts of unified social tax;

· expenses for maintenance and operation of equipment;

· part of general production expenses;

· other costs associated with the manufacture of defective products.

To calculate the cost of the final defect, you must perform the following steps:

1. calculate the costs of manufacturing defective products;

4. determine the amount of losses from the final marriage.

Accounting for irreparable internal defects is documented by accounting entries:

Account correspondence
Debit	Credit
		The cost of defective products is written off
		Defective products are accepted for accounting at the price of possible use
		Amounts to be recovered from those responsible for the marriage have been accrued
		Amounts to be recovered from suppliers of defective materials have been accrued
		Losses from defects are included in the cost of production

Example 1.

During production, an irreparable defect in a batch of products was identified, the cause of which was the use of low-quality materials. The costs of manufacturing defective products were:

The cost of materials used is 25,000 rubles;

Salary – 15,000 rubles;

The amount of unified social tax is 3,900 rubles;

The share of general production costs is 7,500 rubles.

The possible sale price of defective products is 20,000 rubles.

A claim was filed against the supplier of low-quality materials; the amount claimed for collection is 10,000 rubles.

Account correspondence		Amount, rubles
Debit	Credit
			The cost of defective products is reflected (25,000 + 15,000 + 3,900 + 7,500)
			Defective products are accepted for accounting at the price of possible sale
			The amount to be collected from the supplier has been accrued
			Losses from defects are included in the cost of production (51,400 – 20,000 – 10,000)

The cost of internal correctable defects includes:

· the cost of raw materials and supplies used to correct the defect;

In practice, the question often arises as to whether it is necessary to restore VAT on the cost of material assets that were used in the production of defective products. Some experts believe that if the defective products are not subsequently sold, then the VAT previously accepted for deduction in the part attributable to the cost of inventory items used in the production process of the defective products must be restored and paid to the budget.

It is difficult to agree with this point of view. Let us remind you that in accordance with subparagraph 1 of paragraph 2 of Article 171 of Chapter 21 of the Tax Code Russian Federation(hereinafter referred to as the Tax Code of the Russian Federation), VAT amounts presented to the organization and paid by it when purchasing goods on the territory of the Russian Federation necessary for carrying out transactions recognized as objects of taxation in accordance with Chapter 21 of the Tax Code of the Russian Federation are subject to deductions. In addition, losses from defects for profit tax purposes are included in other expenses (subparagraph 47 of paragraph 1 of Article 264 of Chapter 25 of the Tax Code of the Russian Federation, therefore, despite the fact that part of the acquired inventory was used in the production of defective products, expenses for such materials are directly related to the sale of goods, that is, to transactions subject to VAT.

Consequently, in accordance with subparagraph 1 of paragraph 2 of Article 171 of Chapter 21 of the Tax Code of the Russian Federation, the deduction was made by the organization lawfully, and there is no need to restore the amount of VAT accepted for deduction in the part attributable to the cost of inventory items used in the production of defective products of the organization.

If the requirements of Article 252 of Chapter 25 of the Tax Code of the Russian Federation are not met, and therefore the cost of defective products cannot be recognized as expenses for the purposes of Chapter 25, then in accordance with subparagraph 2 of paragraph 1 of Article 146 of Chapter 21 of the Tax Code of the Russian Federation, such expenses are expenses for own needs, which are subject to VAT. At the same time, the organization retains the right to a VAT refund on material assets that were used to produce defective products in accordance with subparagraph 1 of paragraph 2 of Article 171 of Chapter 21 of the Tax Code of the Russian Federation.

In tax accounting, losses from defects are included in other expenses associated with production and sales on the basis of subparagraph 47 of paragraph 1 of Article 264 of Chapter 25 of the Tax Code of the Russian Federation. These expenses are indirect and are taken into account as expenses of the reporting period in full (clause 2 of Article 318 of the Tax Code of the Russian Federation). At the same time, among other expenses associated with production and sales, taken into account for the purpose of determining the tax base for corporate income tax, taxpayers have the right to include only those losses from defects in production that are not subject to recovery (withholding) from those responsible for the defects.

In order to recognize losses from marriage, it is necessary to comply with the requirements of Article 252 of Chapter 25 of the Tax Code of the Russian Federation. Let us recall that in accordance with paragraph 1 of Article 252 of the Tax Code of the Russian Federation, expenses for tax accounting purposes are recognized as justified and documented expenses incurred by the taxpayer, provided that they were incurred to carry out activities aimed at generating income.

Justified expenses mean economically justified expenses, the assessment of which is expressed in monetary form. Documented expenses mean expenses supported by documents drawn up in accordance with the legislation of the Russian Federation.

Organizations that apply a simplified taxation system in accordance with Chapter 26.2 of the Tax Code of the Russian Federation and have chosen “income reduced by the amount of expenses” as the object of taxation will not be able to include losses from marriage as expenses, since Chapter 26.2 of the Tax Code of the Russian Federation contains a closed list of expenses and expenses in the form of losses from marriage are not provided for in Article 346.16 of Chapter 26.2 of the Tax Code of the Russian Federation.

An external defect is one that is detected after the finished product has been shipped to the buyer.

Losses from external defects are reflected in the costs of the month in which claims from customers are received and accepted. Losses from defects that relate to products manufactured in previous periods are included in the cost of similar products produced in the current period. If such products are not produced in the current period, then these costs are distributed by type of product as general production costs.

Article 475 of the Civil Code of the Russian Federation establishes the following:

"1. If the defects of the goods were not specified by the seller, the buyer to whom the goods of inadequate quality were transferred has the right, at his own discretion, to demand from the seller:

proportionate reduction in the purchase price;

free elimination of product defects within a reasonable time;

reimbursement of their expenses for eliminating defects in the goods.

2. In the event of a significant violation of the requirements for the quality of the goods (detection of irreparable defects, defects that cannot be eliminated without disproportionate costs or time, or are detected repeatedly, or appear again after their elimination, and other similar defects), the buyer has the right to choose :

refuse to fulfill the purchase and sale agreement and demand the return of the amount of money paid for the goods;

demand the replacement of goods of inadequate quality with goods that comply with the contract.”

The cost of an irreparable external defect includes:

· production cost of products (products) ultimately rejected by the consumer;

· reimbursement to the buyer of costs incurred in connection with the purchase of these products;

· transportation costs for returning defective products;

· other costs associated with the production of defective products.

To ensure that the return of products is not qualified as its resale to the manufacturing organization, it is important to correctly draw up documents confirming the nature of the transaction. In this case, an act of identifying defects is drawn up (form TORG-2) and a claim is filed, which reflects the fact of delivery of low-quality products and indicates whether the supplier should transfer money to the buyer for defective products, or pay off the debt incurred after the return of defective products by shipping similar products of proper quality.

As a rule, external defects are detected not in the month when the products were manufactured, but later, when the rejected products are already included in the sales volume.

In the event of returning defective products, the supplier must reverse accounting transactions for sales in the share attributable to the defect, including the amount of accrued taxes.

The procedure for writing off external defects depends on the period when they were identified and on whether the organization creates a reserve for warranty repairs or not.

The cost of external correctable defects includes:

· costs of correcting defective products from the consumer;

· transportation costs for transporting products from the buyer to the manufacturer and back;

· other costs to reimburse the buyer for the purchase of products.

In the event that the manufacturing organization corrects a detected defect and then again delivers the product with corrected defects to the buyer, the following must be taken into account. Since the product has already been sold, ownership of it has passed to the buyer. Consequently, for the period during which these products are in the manufacturing organization and work is being carried out to eliminate defects, they should be accounted for in off-balance sheet account 002 “Inventory assets accepted for safekeeping.”

Example 4.

Let's change the conditions of example 3.

The organization sold a batch of 10 products. The selling price of one product is 23,600 rubles (including VAT 3,600 rubles). The cost of one product is 15,000 rubles.

During the use of the products, the buyer discovered defects in three products; the defects can be eliminated.

VAT reflected on transport costs

VAT is deductible

Losses from defects are included in the cost of production of the current period (1,000 + 3,000 + 5,000 + 1,300 + 1,000 – 8,000)

Features of accounting for income tax from the seller on returned low-quality goods.

The obligation to pay tax arises when the payer has an object of taxation. In accordance with Article 38 of Part One of the Tax Code of the Russian Federation, objects of taxation may be transactions for the sale of goods (work, services), property, profit, income, cost of goods sold (work performed, services rendered) or another object that has a cost, quantitative or physical characteristics, with the presence of which the taxpayer’s legislation on taxes and fees associates the emergence of an obligation to pay tax. The sale of goods, works or services is recognized as the transfer on a reimbursable basis of ownership of goods, the results of work performed, the provision of services, and in cases provided for by the Tax Code of the Russian Federation - also on a gratuitous basis (clause 1 of Article 39 of the Tax Code of the Russian Federation).

When returning low-quality goods, there is no object of taxation, since the parties return to their original position: it is impossible to recognize the returned goods as sold, since we consider the buyer’s obligation to accept the goods unfulfilled. In addition, there is no mandatory sales criterion - consideration of the transfer, since the amounts paid are returned to the buyer.

Due to the fact that there is no object of taxation, therefore, there is no obligation to pay taxes, in particular income tax (clause 1 of Article 248 of Chapter 25 of the Tax Code of the Russian Federation).

It should be noted that at the time of shipment (transfer of goods from the seller to the buyer), the seller has no information about whether a certain volume of products will be returned or not. Therefore, an organization that determines income and expenses using the accrual method for the purposes of Chapter 25 of the Tax Code of the Russian Federation forms the tax base on the basis of primary documents as of the date of sale of goods.

But Chapter 25 of the Tax Code of the Russian Federation does not contain direct instructions on how to reflect the return of goods in tax accounting and how to take it into account when calculating the tax base for income tax.

In our opinion, the return of low-quality goods will depend on the period in which it is carried out. If the return of a low-quality product occurred in the same tax period as the sale, then the seller must reduce the amount of income from the sale, calculated in accordance with Articles 249 and 316 of the Tax Code of the Russian Federation, by the amount of the refund that was received by the seller for this product. And the amount of expenses of the current tax period should be reduced by the purchase price of the returned goods.

In addition, in tax accounting, losses from defects are included in other expenses associated with production and sales on the basis of subparagraph 47 of paragraph 1 of Article 264 of Chapter 25 of the Tax Code of the Russian Federation. These expenses are indirect and are taken into account as expenses of the reporting period in full (clause 2 of Article 318 of the Tax Code of the Russian Federation). At the same time, among other expenses associated with production and sales, taken into account for the purpose of determining the tax base for corporate income tax, taxpayers have the right to include only those losses from defects in production that are not subject to recovery (withholding) from those responsible for the defects, in compliance with the requirements of Article 252 chapter 25 of the Tax Code of the Russian Federation.

End of the example.

You can find out more about issues related to the specifics of accounting and tax accounting in production in the book of JSC “BKR-Intercom-Audit” “ Production».