diff --git a/compiler/cli/src/org/jetbrains/kotlin/cli/jvm/modules/CliJavaModuleFinder.kt b/compiler/cli/src/org/jetbrains/kotlin/cli/jvm/modules/CliJavaModuleFinder.kt
index a6beb4b1b34..8025084eade 100644
--- a/compiler/cli/src/org/jetbrains/kotlin/cli/jvm/modules/CliJavaModuleFinder.kt
+++ b/compiler/cli/src/org/jetbrains/kotlin/cli/jvm/modules/CliJavaModuleFinder.kt
@@ -120,14 +120,41 @@ class CliJavaModuleFinder(
             moduleInfo,
             when {
                 useLastJdkApi -> listOf(JavaModule.Root(moduleRoot, isBinary = true, isBinarySignature = useSig))
-                //TODO: distinguish roots from different modules under JDK 10-11
-                useSig -> listFoldersForRelease().map { JavaModule.Root(it, isBinary = true, isBinarySignature = true) }
+                useSig -> createModuleFromSignature(moduleInfo)
                 else -> error("Can't find ${moduleRoot.path} module")
             },
             file, true
         )
     }
 
+    private fun createModuleFromSignature(moduleInfo: JavaModuleInfo): List<JavaModule.Root> {
+        val packageParts =
+            if (isCompilationJDK12OrLater) emptyMap()
+            else hashMapOf<String, Boolean>().also { parts ->
+                moduleInfo.exports.forEach {
+                    it.packageFqName.pathSegments().fold("") { acc, v ->
+                        val packagePart = if (acc.isEmpty()) v.asString() else "$acc.${v.asString()}"
+                        parts[packagePart] = false
+                        packagePart
+                    }
+                }
+                //Do it separately to avoid reset to false
+                moduleInfo.exports.forEach {
+                    parts[it.packageFqName.asString()] = true
+                }
+            }
+
+
+        return listFoldersForRelease().map { virtualFile ->
+            JavaModule.Root(
+                if (isCompilationJDK12OrLater) virtualFile
+                else ModuleVirtualFileForRootPart(virtualFile.parent, virtualFile, packageParts, ""),
+                isBinary = true,
+                isBinarySignature = true
+            )
+        }
+    }
+
     private fun codeFor(release: Int): String = release.toString(36).toUpperCase()
 
     private fun matchesRelease(fileName: String, release: Int) =
diff --git a/compiler/cli/src/org/jetbrains/kotlin/cli/jvm/modules/CliJavaModuleResolver.kt b/compiler/cli/src/org/jetbrains/kotlin/cli/jvm/modules/CliJavaModuleResolver.kt
index 6afec412dc6..e3ea14f7f90 100644
--- a/compiler/cli/src/org/jetbrains/kotlin/cli/jvm/modules/CliJavaModuleResolver.kt
+++ b/compiler/cli/src/org/jetbrains/kotlin/cli/jvm/modules/CliJavaModuleResolver.kt
@@ -54,8 +54,7 @@ class CliJavaModuleResolver(
     private val sourceModule: JavaModule? = userModules.firstOrNull(JavaModule::isSourceModule)
 
     private fun findJavaModule(file: VirtualFile): JavaModule? {
-        //TODO: proper root filtering is required
-        if (file.fileSystem.protocol == StandardFileSystems.JRT_PROTOCOL /*|| file.extension == "sig"*/) {
+        if (file.fileSystem.protocol == StandardFileSystems.JRT_PROTOCOL) {
             return systemModules.firstOrNull { module -> file in module }
         }
 
diff --git a/compiler/cli/src/org/jetbrains/kotlin/cli/jvm/modules/ModuleVirtualFileForRootPart.kt b/compiler/cli/src/org/jetbrains/kotlin/cli/jvm/modules/ModuleVirtualFileForRootPart.kt
new file mode 100644
index 00000000000..ba59ed744db
--- /dev/null
+++ b/compiler/cli/src/org/jetbrains/kotlin/cli/jvm/modules/ModuleVirtualFileForRootPart.kt
@@ -0,0 +1,62 @@
+/*
+ * Copyright 2010-2021 JetBrains s.r.o. and Kotlin Programming Language contributors.
+ * Use of this source code is governed by the Apache 2.0 license that can be found in the license/LICENSE.txt file.
+ */
+
+package org.jetbrains.kotlin.cli.jvm.modules
+
+import com.intellij.openapi.vfs.VirtualFile
+import java.io.InputStream
+
+class ModuleVirtualFileForRootPart(
+    private val parent: VirtualFile?,
+    private val virtualFile: VirtualFile,
+    private val packages: Map<String, Boolean>,
+    private val currentPackage: String
+) : VirtualFile() {
+
+    private val _children by lazy {
+        val children = virtualFile.children ?: return@lazy null
+        val isExported = packages.getOrDefault(currentPackage, false)
+        children.mapNotNull {
+            when {
+                it.isDirectory -> {
+                    val childPackage = if (currentPackage.isEmpty()) it.name else currentPackage + "." + it.name
+                    if (packages.contains(childPackage))
+                        ModuleVirtualFileForRootPart(this, it, packages, childPackage)
+                    else null
+                }
+                isExported -> ModuleVirtualFileForRootPart(this, it, emptyMap(), currentPackage)
+                else -> null
+            }
+        }.toTypedArray<VirtualFile>()
+    }
+
+    override fun getName() = virtualFile.name
+
+    override fun getFileSystem() = virtualFile.fileSystem
+
+    override fun getPath() = virtualFile.path
+
+    override fun isWritable() = virtualFile.isWritable
+
+    override fun isDirectory() = virtualFile.isDirectory
+
+    override fun isValid() = virtualFile.isValid
+
+    override fun getParent(): VirtualFile? = parent
+
+    override fun getChildren(): Array<VirtualFile>? = _children
+
+    override fun getOutputStream(p0: Any?, p1: Long, p2: Long) = virtualFile.getOutputStream(p0, p1, p2)
+
+    override fun contentsToByteArray(): ByteArray = virtualFile.contentsToByteArray()
+
+    override fun getTimeStamp() = virtualFile.timeStamp
+
+    override fun getLength() = virtualFile.length
+
+    override fun refresh(p0: Boolean, p1: Boolean, p2: Runnable?) = virtualFile.refresh(p0, p1, p2)
+
+    override fun getInputStream(): InputStream? = virtualFile.inputStream
+}
\ No newline at end of file
diff --git a/compiler/testData/javaModules/releaseFlag/moduleSwing.txt b/compiler/testData/javaModules/releaseFlag/moduleSwing.txt
index 3c90171892d..a7fce1d9ab4 100644
--- a/compiler/testData/javaModules/releaseFlag/moduleSwing.txt
+++ b/compiler/testData/javaModules/releaseFlag/moduleSwing.txt
@@ -1,4 +1,4 @@
-compiler/testData/javaModules/releaseFlag/moduleSwing/foo/Foo.kt:5:24: error: symbol is declared in module 'javafx.media' which current module does not depend on
+compiler/testData/javaModules/releaseFlag/moduleSwing/foo/Foo.kt:5:18: error: unresolved reference: swing
     val z: javax.swing.JFrame? = null
-                       ^
+                 ^
 COMPILATION_ERROR