Yekaterina Tripoten, analyst of Sovlink IC

– IAS better reflect the financial state of a company than RAS do

In July-Aug 2009 Atomenergoprom OJSC is planning to hold a tender for the right to draft consolidated financial report for Jan-June 2009 in compliance with the International Accounting Standards (IAS); to audit the consolidated financial report drafted for Atomenergoprom companies for 2010 in compliance with IAS; to provide consultation on whether the cost of the assets and obligations are fair and comply with the requirements of IAS.

The International Accounting Standards better reflect the financial state of a company than the Russian Accounting Standards do. Foreign investors know this standard better than ours. A company applying the IAS has bigger chances for receiving loans from foreign banks. The IAS will certainly be helpful if Atomenergorpom decides to offer its bonds to investors rather than to sell it to banks. The more creditors you have the bigger money you can borrow.
 
Since the IAS are a consolidated system, they will show the financial state of the whole civil nuclear complex, including the few mining companies that trade on the stock exchange. And this will certainly attract investors. If they like what they see their interest in Atomenergoprom’s mining and other subsidiaries as the only way to take part in the Russian nuclear industry will grow. As a result, the holding will become more valuable for its shareholders.

Atomenergoprom OJSC (Atomny Energopromyshleny Kompleks) is a state holding that is supposed to comprise 89 nuclear companies and to cover the whole range of nuclear services: from uranium mining to NPP construction and electricity production. Atomenergoprom’s companies will have a total of 175,000 employees and an annual production of 200bln RUR (5.5bln EUR). Atomenergoprom is one of the biggest players on the world market: it has a 40% share in the world’s uranium enrichment services, 17% in nuclear fuel production, 8% in uranium mining, 28% in NPP construction (10 reactors). The director of Atomenergoprom is Vladimir Travin, the chairman of the board of directors – Sergey Kiriyenko.