A Critical Review of Georgiou, G. (2010) “The IASB standard-setting process: Participation and perceptions of financial statement users”, British Accounting Review, 42 (2), pp.103-118. Dr George Georgiou is a senior lecturer in Accountancy and the director of the MSc International Accounting & Finance course at the Birmingham Business School, University of Birmingham. He has the following qualifications: BA, MAcc, PhD & CPA. Georgiou is also a PhD supervisor in his research interest topics which lie in accounting regulation, accounting theory, government accounting and market-based accounting. (University of Birmingham, 2010). As stated by Bruce (2010), financial statement users are often described as the primary users of financial …show more content…
Georgiou does offer an explanation throughout his article for this. He points out that there are a low number of studies investigating the reasons behind it. With the amount of literature found for previous empirical evidence, it would have been preferred if it was presented in a table format similar to the article by Duff et al. (2007). Though, narrative, he has presented the previous empirical studies very effectively by criticising their responses in a subtle way. Up-to-date literature has not been presented in the literature review; yet, we must bear in mind that current research will not always be relevant to what the author is trying to convey. In the literature review, the author has referenced a piece of quote incorrectly, only stating the page number, in the first paragraph on page 105 of his article. Georgiou has presented his research questions in the form of hypotheses in a separate section under Development of hypotheses. The Development of hypotheses should have been included after the introduction in which this would lead into the literature review. This section had a few quotes from past studies which would have made Georgiou's literature review
The goal of the Codification is to simplify the organization of thousands of authoritative U.S. accounting pronouncements issued by multiple standard-setters. To achieve this goal, the FASB initiated a project to integrate and topically organize all relevant accounting pronouncements issued by the U.S. standard-setters including those of the FASB, the American Institute of Certified Public Accountants (AICPA), and the Emerging Issues Task Force (EITF)
Australian bookkeeping gauges are set by the Australian Accounting Standards Board (AASB) and have the power of law for Corporations law elements under s 296 of the Corporations Act 2001. They should likewise be connected to all other universally useful monetary reports of reporting elements in general society and private parts.Australian Accounting standards board oversee process of accouting standards if all companies registerd with ASIC complying with these standards and their financial reports are maintend with standards to keep public share holders money in safe hand in past many auditors companies used to ignore accounting standards to give companies actual financial figuers lower or higher to keep their shares prices or investors intact this lead to so many financial crises and collapse of comapanies.The case analyses the high standards required by the accounting profession in line with the requirements of the Australian Standards Board prescription. Further, the case is analyzed technically in line with the accounting standards prescribed by the institute. Here, an employee accountant of a company is asked to iron out the
Wolk, H., Dodd, J., & Tearney, M. (2003). Accounting Theory: Conceptual Issues in a Political and Economic Environment (6th edition ed.). South-Western College Pub.
Accounting is considered to be a Social and institutional practice, one which is constitutive and intrinsic to social relations (Hopwood, 1994, pg1). In case of (MA), internal users like managers are provided with (MA) information (Seal, 2009, pg4). This information focuses on both human performance and product services costs. It also gives the responsibility to managers to take measures according to the planning, directing and motivating and controlling of the business (Young, 2003, chapter5). Modern managerially-run enterprises was first established by Chandler in the United States between ‘1830 to 1860’(Chandler, 1977, pg3).It makes possible the world of oligopolies, which brings imperfect competition and misallocation of resources. It is...
Olusegun Wallace, R. 1996. The Development of Accounting Research in the UK. In: Cooke, T. and Nobes, C. eds. 1997. The Development of Accounting in an International Context. London: Routledge, pp. 218-254.
In 2001, an outline was approved by the IASB to offer direction in creating accounting standards. The outline has 4 main objectives, namely 1) defining the aims and objectives of financial statements 2) identification of features that create useful information 3) explaining the basic facts of financial statements and 4) and offering theories of capital maintenance.
Hines, R. D. (1991). The FASB’s conceptual framework, financial accounting and the maintenance of the social world. Accounting organizations and society, 16(4), 313-331.
Financial reporting and its regulation are affected by the self-interest of the individuals involved and the individuals form into groups to help achieve their objectives. Individuals are involved in the standard setting process scope for self-interest to get in the way of “neutral and unbiased” accounting regulations the individuals that will be regulated by the new accounting standards can have an impact on the standard setting process. The adverse economic and social consequences must also be considered.
In conclusion, appropriate principles could lead to clearer interaction and more comparable financial reporting standards without the need of the current rules. The NZ Framework has provided parts of clear and appropriate underlying principles to lead the application of NZ GAAP and other financial reporting standards. However the standards setting movement from ‘rule-driven’ approach to ‘principle-based’ approach is still half-way in New Zealand. How could principles be sufficiently clearly portrayed and put into practice require the profession to think and support. Just as Tweedie (2007, p.7) states, a principle based system will only work if preparers, auditors, users and regulators wish to make it work.
So for the purpose of this paper let's take a step back and look at the main reasons for why financial reporting practices still differ across most countries today. Since the 14th century when the double-entry accounting system bookkeeping was developed by in Northern Italy and used by Venetian merchants. The two different accounting methods, Anglo-Saxon and Continental-European have always managed to co-exist separately. However, due to the rise of the emerging markets, international harmonization of accounting standards is an important topic in this globalizing economy. Standard setters, company managers, and researchers alike are interested in the evolution of global standards. All current indications are that harmonization will be a ready, it is just a matter of how fast it will happen, who will set the global...
The introduction of International Financial Reporting Standards, users of financial statements are facing a wide range of information on financial instruments yet it is becoming increasingly difficult to understand what is most important.
Judgement is a notion of relevance and reliability in developing and applying accounting policies. It is a requirement of management that they exercise a high degree of professional judgement when selecting appropriate accounting policies in the preparation of financial statements that is relevant to decision-making and assessment needs of users. Management should also consider the applicability of IFRS and AASB in dealing with similar and related issues and then the definitions, recognition criteria in the Conceptual Framework when there is no IFRS standard or interpretation in certain circumstances that are specifically applicable. Management may also consider the most current pronouncements of other standard-setting bodies to the extent that do not conflict with IFRS and AASB in developing accounting standards and accepted industry practices by using a similar conceptual framework.
Accounting gives companies, investors, regulators and others with a standardized way to explain the financial performance of an entity. Accounting standards present preparers of financial statements with a set of rules that they have to follow when preparing an entity’s accounts, making sure this standardization is across the market (Robert 2008). Many Companies are required to publish their financial statements in accordance with the relevant accounting standards. To simply International Financial Reporting Standards (IFRS) is one set of accounting standards, which have been established and maintained by the IASB with the purpose of those standards being efficient of being useful consistently. These two bodies work together to come
What is it exactly that makes a business thrive? Is it the popular line of production being sold? The quality of customer service? The manner in which the industry is organized? Indeed, these attentions have a significant role in a corporation, but most importantly just how well is a company running. Hence, the financial statements are the key element in any business. This provides information to shareholders, investors, and more especially to its managers, because these individuals are the ones to understand and communicate the performance of the company. Investopedia comments that “accounting standards are crucial in an efficient market, as information must be transparent, credible, and understandable.” Therefore, the FASB (Financial Accounting Standards Board) has a mission to improve accounting practices in a corporation by enhancing guidelines for accounting reports, to distinguish and solve issues in a suitable manner, and create a fair standard across the financial markets that all those who are busineess affiliated, must pertain.
The success of a company is very dependent upon its financial accounting. In accounting there are numerous Regulatory bodies that govern the accounting world. These companies are extremely important to a company because they set the standards when it comes to the language and decision making of a company. These regulatory bodies can be structured as agencies, associations, commissions, and boards. Without companies like the Security and Exchange Commission (SEC), The Financial Accounting Standards Board (FASB), the Governmental Accounting Standards Board (GASB), Internal Accounting Standards Board (IASB), Internal Revenue Service (IRS), and other regulatory bodies a company could not make well informed decisions. In this paper the author will look at only four of them.