Essay
The Financial Accounting Standards Boards (FASB) defined conceptual framework as a consistent of underlying concepts and the ideas that describe the nature and general purpose of financial reporting which may lead to consistent standard in accounting (Deegan 2010). The role of the conceptual framework is to ensure that financial statements in accounting are free from bias and to provide useful information that is useful for user’s decision making. The standard-setting board also formulated a range of perceptions and theories related to accounting to trigger the objectives of financial reporting. The standard-setting board keeps issuing the conceptual framework over time to ensure that the conceptual framework’s objectives are improving to provide useful financial information. The innovative work on conceptual framework was embraced in the United States by the FASB in the early 1970s. The FASB accomplished disappointment in attempting to generate a standard that at the outset might not appear to present, especially testing theoretical issues. Regardless, while attempting to achieve concession on Statement of Financial Accounting Standard, tending to the theoretical issues produced critical matter for the board members. In this manner, throughout the outset the FASB understood the requirement for an obvious conceptual framework. Based on Hines’s argument, the conceptual framework is mean to provide the ability to increase self-regulate of a profession in order to neutralizing government interference from arising. Whether this argument has been accepted or not will be discussed in more detail with supported evidence to clarify the main point about Hines’s argument. Further details about this argument will discuss below.
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Donal E. Kieso, Wegandt J. Jerry, Warfield D. Terry. (2012). Intermediate Accounting. Hoboken, NJ: Wiley.
To help accounting professionals easily navigate through 50-plus years of unorganized US generally accepted accounting principles (GAAP) and standards the Trustees of the Financial Accounting Foundation approved the Financial Accounting Standards Board (FASB) Accounting Standards Codification (Codification.) By codifying authoritative US GAAP, FASB will provide users with real-time and accurate information in one location. Concurrently, FASB developed the FASB Codification Research System; a web-based system allowing registered users to electronically research accounting issues. Since 2009, the codification became the single source of nongovernmental authoritative GAAP.
Romney, Marshal, and Paul Steinbart. Accounting Information Systmes. 10th ed. Upper Saddle River: Pearson Education, 2006. 193-195.
Ruth Dianne Hines, born 1951 is an Australian Accounting academic based in the School of Economic and financial studies at Macquarie University from 1978-1994. The Conceptual Frameworks are ‘a strategic maneuver for providing legitimacy to standard-setting boards during periods of competition or threatened government intervention,’ Hines raised this argument in her 1989 journal ‘Financial Accounting Knowledge, Conceptual Framework Project and the Social Construction of the Accounting Profession’. In order to identify the basis of Hines’ argument, one must first take a look at what the Conceptual Framework (CF) is, as well as its purpose. Throughout this discussion, I will be examining – the need for a CF, the benefits and how it provides a legitimacy to the accounting profession. I will also be exploring both the local and international history of the CF projects that were undertaken, why they were undertaken and if these purposes relate to Hine’s argument.
This report analyses the disclosures of objective of general purpose financial reporting and the qualitative characteristics of useful financial information according to The Conceptual Framework for Financial Reporting. It investigates Bega’s current accounting practice of Property, Plant and Equipment in accordance with AASB 116 Property, Plant and Equipment, and how it satisfies the objective of general purpose financial reporting and the qualitative characteristics of useful financial. This result will then recommend Bega to improve their current accounting practices.
Until late 2002, financial reporting standards (FRS) in New Zealand were developed based on a sector neutral approach. This meant a single set of accounting standards were applied to all entities regardless of which sector they were operating in. This was achievable because when FRS was created, the financial reporting standards board (FRSB) took into account that entities in the public sector, not-for-profit sector and private sector would be applying these standards. This included having to think about a broad range of transactions, different reasons for carrying out transactions, the readers of financial statements for all sectors, and the information that those readers needed (Brady, 2009). Not only did FRS account for the range of entities that would be applying the standards but it was also written in a language that was appropriate and made sense for all entities in each sector (Brady, 2009). However, since the decision to
Marshall, M.H., McManus, W.W., Viele, V.F. (2003). Accounting: What the Numbers Mean. 6th ed. New York: McGraw-Hill Companies.
This essay will discuss the influence NZ Framework brings to financial reporting standards that included NZ GAAP based on the debate between principles-based and rule-based. In particular, it will portray: (1) the nature and orientation of financial reporting framework and GAAP; (2) the main improvement of NZ Framework and the applications framework guided in NZ GAAP.
According to Financial Accounting Foundation (2014), the FASB Accounting Standards codification is "the source of authoritative generally accepted accounting principle (GAAP) recognized by the Financial Accounting Standard Board (FASB) to be applied to nongovernmental entities" (FASB.org, 2014). The codification system allows user to access the authoritative content, do research, and give feedback. The purpose of the FASB Codification system is make clear and easier to locating, understanding and applying the accounting standards through using an online database, which developed and issued the standards over the years. The implementation of codification system reduces the amount of time and effort required to resolve accounting research issues.
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The conceptual framework identifies the primary users of accounting information as investors, creditors, and those who advise them. It also assumes a “prudent” investor; that is, an investor who takes the time to become reasonably well informed with respect to accounting theory and practice. Discuss this concept with respect to the current economic environment. Are different groups of investors “prudent”? According to the conceptual framework, the potential users of financial statements are investors, creditors, suppliers, employees, customers, governments and agencies, and the general public (Financial Accounting Standards Board, 2006).
Heisinger, K., & Hoyle, J. B.(2012). Accounting for Managers. Creative Commons by-nc-sa 3.0. Retrieved from: https://open.umn.edu/opentextbooks/BookDetail.aspx?bookId=137
The purpose of this document is to describe the nature, purpose and scope of accounting and it deliberately explains the details of each category in accounting. Accounting involves in preparing financial documents of an entity by analyzing, verifying, and reporting this records. It emphasizes its major characteristic role in field of banking and finance, with a mixture of supportive sub topics.