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Advantages and disadvantages of international accounting standards
Introduction of accounting standards
Introduction of accounting standards
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This framework sets out the concepts that trigger the preparation and presentation of financial statements for external users. The purpose of the framework is to: assist the Board of IASC in the development of future International Accounting Standards and in its review of existing International Accounting Standards; assist the Board of IASC in promoting harmonization of regulations, accounting standards and procedures relating to the presentation of financial statements by providing a basis for reducing the number of alternative accounting treatments permitted by International Accounting Standards; assist national standard-setting bodies in developing national standards; Assist preparers of financial statements in applying International Accounting Standards and in dealing with issues that have yet to form the subject of an International Accounting Standards. assist auditors in establishing an opinion as to whether financial statements conform with International Accounting Standards; Assist users in interpreting the information contained in financial statements prepared in conformity with International Accounting Standards. Provide those who are interested in the work of IASC with information about its approach to the formulation of International Accounting Standards. IASB/FASB JOINT CONCEPTUAL FRAMEWORK PROJECT A major objective of the joint project is to deal with what have been termed ‘cross cutting issues’. These are issues that prove to arise on number of occasions in setting standards and have not been resolved on a consistent basis. The project will seek to develop a framework which facilitates consistency in regulation. Examples of cross cutting issues are,- Should general purpose financ... ... middle of paper ... ...ounting standards upon striving towards convergence Likewise, increase in a number of workshops or seminars for creating awareness and developing skills in the area of IFRS. CONCLUSION Upon researching, it can be stated that Companies in Fiji adopt Conceptual Framework (CF) by 2012 but in a gradual manner, in view of the predicted problems that the adoption may create. Therefore, the research concludes that Fiji companies should converge to IFRS in view of the fact that it will enhance better accountability and transparency and improve quality of reporting. However, due to the fact that IFRS being a principle based standards, it allows companies to utilize only the methods they wish, thus, allowing the financial statements to show only desired results and leading to revenue or profit manipulation and hiding of financial problems in the company.
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)
FASB Codification. Digital image. FASB Accounting Standards Codification Professional View. FASB. Web. 28 Nov. 2010. .
In the world of international finance there are two major accounting systems; GAAP, which stands for Generally Accepted Accounting Principles, and IFRS, which stands for International Financial Reporting Standards. The United States prefers GAAP while the European market, as well as many other countries, prefers IFRS. By 2015 the Securities Exchange Commission is anticipating a total transfer to IFRS in the United States. Though the differences between GAAP and IFRS are few, they could affect accuracy of financial reporting throughout the world. It is important to understand the differences and similarities between both GAAP and IFRS if one is to globalize ones market (Logue).
One of the most debatable topics in the accounting industry today is the extent in which we should make the financial statements understandable to the general population. The FASB currently gears its reporting standards toward...
These varying standards have created inconsistencies between the reporting of financial statements. The International Accounting Standards Board (IASB) and the Financial Accounting Standards Board (FASB) collaborated to develop a compatible set of accounting standards that would provide one framework to solve this problem. The team introduces initial drafts of new revenue recognition standard during 2010 and 2011. The final standard was issued on May 28th, 2014.
By the Companies and Allied Matters Acts 1990(CAMA), the primary function of an auditor is to audit the financial statements of the company and form an opinion as to whether a) proper accounting records have been kept by the company and b) the company’s balance sheet and profit and loss account are in agreement with the accounting records and returns provided to the auditor by the company. The True and Fair view opinion by auditors on the financial statements of companies gives credibility to such reports. This have a way of convincing the users of such information that the financial statements can be relied
The main objective of the IASC was the development of International Accounting Standards, in an effort to reduce the differences in accounting practices across countries. Harmonization is the name given to the process of reducing differences in financial reporting practices and increasing comparability of financial statements in various countries. As such the intent of the IASC was to create a set of accounting rules that would be relevant and consistent to all countries ...
The role of IAASA within the context of international financial reporting is to collaborate with all approved bodies in Ireland. Such as;
According to business, or any organization, Accounting plays a major role in developing and growth of the business. Financial standards of the organization expected as the complexities of business growth and expansion. Hence determining the implementation of the standards can vary according to the type of industry, business or organization.
Growth in international trade has been on the increase over the years necessitating several organizations to be involved in the efforts to harmonize accounting practices either regionally or internationally. Among those, leading in this effort were the European Union (EU) and International Accounting Standards Board (IASB) (formerly International Accounting Standards Committee.
I have applied the IFRS to audit half-year income statement and statement of finical position from domestic sub-company or oversea branches. This allows me to understand the difficultly of dealing with accounting report form different nations. For example, we have to negotiate each report from the U.S. with their reporter by phone. It would take incredibly long time to explain the difference in order to adjust the figures in the reports. During the stuff training, we have been taught that to be professional at everywhere and anytime. Moreover, I realise that the most important feature to be a professional accountancy is responsibility. This is because that a unit of misallocation will cost other team number a huge amount of work to correct it. The experience of taking notes of weekly conferences between senior managers and PWC partner has indicates that how does change in financial policy influence the accounting treatment. For instant, since vice-perminster Mr Le Ke Qiang who visited China Construction Bank at earlier May. He point out that the Rate of Non-Performing Loans could not exceed 7% in the “BIG Four” Chinese bank. This has led Chinese bank to relax its accounting standard of credit rating. It allows me to understand the relationship between government and financial
(i) Judgement and materiality play a significant role in helping to ensure that the selection of accounting policies in presenting the financial statements for a true and fair picture of the company’s financials. This means that entities should provide the financial statements with comparability, consistency and clarity to users of these statements. Entities must follow accounting policies required by IFRS and AASB should be relevant to particular circumstance.
Peasnell, KV 1982, ‘The function of a conceptual framework for corporate financial reporting’, Accounting & Business Research, vol. 12, issue. 48, pp. 243-256, viewed 05 May 2014
The accounting profession, along with its standards and regulatory sources, have changed dramatically in recent years. The accounting profession and its standards once consisted of standardized financial reporting compliance; however, it has now evolved into a specialized profession influenced by its constantly evolving standards resulting in accounting and legal technicalities. Many factors constituted the change, in addition to factors that constituted the need for its change; for example, corporate scandals and a global set of accounting standards respectively. The latter enticed its global trend for accounting harmonization among various private and governmental sectors that work cohesively to obtain its purpose. The various regulatory
Financial statements are intended to be understandable by readers who have "a reasonable knowledge of business and economic activities and accounting and who are willing to study the information diligently."