RBC: Accounts Chamber found half of Mosfilm movie behind film studio balance

According to the report of the Accounts Chamber, almost 1.5 thousand films created on Mosfilm are “behind the balance without monetary valuation”. In total, the studio’s collection includes more than 2.8 thousand films, which are “primary and unique” intangible assets. The publication notes that the Accounts Chamber does not specify which films were taken off the balance. However, the report indicates that, for example, in 2023, Mosfilm wrote off 81 positions with an initial book value of 754 million rubles. At the same time, the joint venture recorded that the film studio entered data on only 90 projects in the register of federal property (RFI), and only 39 films were taken into account on the company’s balance sheet. The audit also found that the debited films were subject to rights-of-use transfers between 2022 and 2024 and “generated significant and consistent enterprise revenue.” Along with the projects, the main trademarks of the film studio were also on the balance, for which Mosfilm continued to conduct litigation due to their misuse. In Mosfilm, the situation was explained by gaps in legislative regulation. The press service explained that the law “does not take into account the specifics of the accounting of works created during the Soviet period.” The film concern was founded in 1924, and most of the films, the "author" and the rights to which Mosfilm has, were created in the USSR. By law, the film studio must take into account all objects on the balance sheet at the initial cost in the amount of actual costs for their creation, the publication notes. Currently, according to Mosfilm, it is objectively impossible to calculate the actual costs of producing these films in their assessment. The film studio stressed that they keep records of Soviet films on off-balance sheet accounts to ensure transparency in the use of projects. This also applies to trademarks. The Accounts Chamber also drew attention to a number of shortcomings of the film studio development strategy for 2021-2024, which was approved by the Ministry of Culture. The report indicates that there was no timetable for the implementation of the activities of the strategy. The recommendations, in the opinion of the auditors, were not consistent with the content of some sections, and the values of the targets are reflected “without taking into account actual achievements in previous years”.

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