The Business SchoolBUACC2606–Corporate AccountingSemester 1, 2013RESEARCH ASSIGNMENT Assessment...

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The Business SchoolBUACC2606–Corporate AccountingSemester 1, 2013RESEARCH ASSIGNMENT Assessment weight: 25% Due Date:Week 10Length:2000wordsGroup Assignment: 2 people“International accounting standards are ‘unusable” from an investor’s viewpoint and make ‘global allocation of capital more complex instead of simplifying it”. Chief financial officersat large listed entities say. Millions of dollars have been spent adopting international financial reporting standards to help investors make like-for-like comparisons between companies in global capital markets. But CFO’s say they are useless and have driven financial disclosures to unmanageable levels...... Investors don’t openthe 60-70 pages of IFRS account, they rely on investor reports and management briefing to understand a company’s numbers.......The criticism comes as the United States, the world’s largest capital market, decides whether to retireits domestic accounting standard (US GAAP) and adopt IFRS”.Australian Financial Review, 6/2/2012.In the light of the above statement;1.Describe the IASB Conceptual Framework’s perspective of users and their decisions.2.Which qualitative characteristics of financial reporting, as per the IASB Conceptual Framework, appear not to be satisfied by current reporting practices as per IFRS.3.In your opinion,do corporate financial reports satisfy the central objective of financial reporting as identified in the Conceptual Framework?Discuss and give example to support your opinion.Assessment criteria2000words max.Excellent(HD)Very Good(D)Good(C)Satisfactory(P)Unsatisfactory(F)1. Introduction XXXXXXXXXXBody/Discussion (40)Criticalevaluation of topic3. Recommendation/s (10)Conclusion (5)4. Examples XXXXXXXXXXReferencing, citations (5)7. Evidence of reading, quality and quantity XXXXXXXXXXEnglish expression, coherence, grammar and spelling. Logical flow of ideas XXXXXXXXXX/5= 25%
	
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BUACC2606 – Corporate Accounting 
Semester 1, 2013

RESEARCH ASSIGNMENT  
 
Assessment weight: XXXXXXXXXX25%  
Due Date:   Week 10 
Length: 2000 words 
Group Assignment:     2 people 
 
“International accounting standards are ‘unusable” from an investor’s viewpoint and make 
‘global allocation of capital more complex instead of simplifying it”. Chief financial officers at 
large listed entities say. Millions of dollars have been spent adopting international financial 
reporting standards to help investors make like-for-like comparisons between companies in 
global capital markets. But CFO’s say they are useless and have driven financial disclosures 
to unmanageable levels…… Investors don’t open the 60-70 pages of IFRS account, they 
rely on investor reports and management briefing to understand a company’s numbers……. 
The criticism comes as the United States, the world’s largest capital market, decides 
whether to retire its domestic accounting standard (US GAAP) and adopt IFRS”.  Australian 
Financial Review, 6/2/2012. 
In the light of the above statement; 
1. Describe the IASB Conceptual Framework’s perspective of users and their decisions. 
2. Which qualitative characteristics of financial reporting, as per the IASB Conceptual 
Framework, appear not to be satisfied by current reporting practices as per IFRS. 
3. In your opinion, do corporate financial reports satisfy the central objective of financial 
reporting as identified in the Conceptual Framework? Discuss and give example to 
support your opinion.Assessment criteria 
 2000 words max. Excellent Very Good Good Satisfactory Unsatisfactory 
(HD) (D) (C) (P) (F) 
1.  Introduction (10)      
2. Body/Discussion (40)      
Critical evaluation of topic 
3. Recommendation/s (10)      
Conclusion (5) 
4. Examples (10)      
6. Referencing, citations (5)      
7.  Evidence of reading,      
quality and quantity (10) 
8.  English expression,      
coherence, grammar and 
spelling....

David · Accepted Answer

Introduction: 
IASB or the International Accounting Standards Framework is a framework 
designed and employed for effective and efficient preparation and presentation of the 
Financial Statements. The IASB Framework was approved by the IASC Board in April 
1989 and thereafter was adopted by the IASB in April 2001. The objective of the 
International Accounting Standards Framework was to help in assisting and guiding the 
users of Financial Reports and to develop in existence of the prevailing standards, revised 
standards for preparation and analysis of financial statements. Such application of the 
standards in the preparation of the financial reports will enable the preparers as well as the 
users in bringing uniformity and comparability of financial statements globally. The IASB 
in the interest of the public took the initiative to develop a globally acceptable international 
financial reporting standard, called IFRS. This high quality, simple articulate, adaptable and 
globally acceptable standards objectives lie in promoting the use and application of the 
standards in the financial reports as well as to cater to the needs of emerging economies and 
small and medium sized entities. With reference to the above mentioned introduction on 
IASB and its effort in developing the IFRS, the following questions have been answered.
1. Describe the IASB Conceptual Framework’s perspective of users and their 
decisions.
Answer
The International Accounting Standard Board’s Conceptual framework brings to 
understanding the objectives of financial reporting and the qualitative characteristics of 
useful and meaningful financial information. It also deals with the elements from which 
financial statements are constructed and reported. Any concept relating to capital and capital 
maintenance are also are also covered by the ISAB.
Users of ISAB could be divided primarily into the following types:
Firstly those existing and also potential investors including lenders and creditors 
involved in decisions relating to providing monetary resources to the organization/entity. 
Decisions are primarily regarding either buying or selling or investing in equity and/or debt 
instruments and also in providing loans or any other forms of credit.
The Financial Information to enable the existing and potential investors along with 
the lenders and creditors for decision making on the reporting entity depends on the 
quality of the Financial Statement. Hence if financial information must be relevant and 
useful and must possess the capability of having predictive confirmatory value.
These users extract the type of information they require and the type of decisions 
they need to make out of that decision. Therefore we call them the primary users and 
hence the financial statements are directed to them for their decisions.
The second category of users would be the regulators and the general public other 
than the potential investors/lenders/creditors. The objective mentioned in the IASB 
Conceptual Framework is to provide financial information about the reporting entity and 
make useful information available. Although these set of users would find the general 
purpose financial reports useful however the financial statements prepared as per IASB 
provide an insight about the economic resources and claims, receipts and payments, 
present and future performance, hence better decision making.
Thus depending on the users and the types of decisions that they require the utility 
and affectivity is enhanced on the condition that the financial statement is capable of being 
compared, verified and interpreted.
2. Which qualitative characteristics of financial reporting as per the IASB Conceptual 
Framework, appear not to be satisfied by current reporting practices as per IFRS. 
Answer  
The IASB conceptual framework has defined certain Qualitative characteristics as 
well as certain enhanced qualitative characteristics based on which the financial reporting 
mechanism ideally works.

The Business SchoolBUACC2606–Corporate AccountingSemester 1, 2013RESEARCH ASSIGNMENT Assessment weight: 25% Due Date:Week 10Length:2000wordsGroup Assignment: 2 people“International accounting...

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