The paper 'ASIC Current Accounting Practice and Disclosures" is a good example of a finance and accounting case study. AASB 101 Presentation and disclosure of Financial Statements (reissued in September 2007) is equivalent to International Accounting Standard (1) which is issued by the International Accounting Standards Board IASB. The objective of AASB 101 is to design the basis for the presentation of general purpose financial reports. This accounting treatment was applicable for annual reporting periods from 1 January 2009 onwards. Financial Accounting Standards Board (FASB) stipulates the accounting measures that ensure that the accounting policies are represented and applied universally. The guidance instituted by the International financial reporting standards IFRS insinuates that companies should attributively follow the requirements of accounting policies.
Consistency in following the accounting principles ensures recuperation of policies from judgments and estimation hence provides an appropriate fair view of the company’ s financial performances. Accounting for uncertainties probably occurs due to the application of judgments and estimation of accounting entries (Booysen, 2008). General Accepted Accounting Principles (GAAP) provide policies that are applied to constitute the consistency of accounting standards. In contrast with significant accounting policies, ASIC Company provides considerable discrepancy ratio on critical accounting based on estimates and accounting policies.
Critical accounting instructed as a result, of assumption based on the assumption of uncertain matters in accounting statements (ASIC Company, 2012). The critical accounting procedures and estimates provide definite uncertainties in accounting statements that may be material in financial reports. ASIC limited regulatory guide describes the reporting requirements of disclosure of accounting policies as per the requirement of the Australian Accounting Standards Board (AASB). Executive summary ASIC partially mergers, the Australian International Accounting standards provided by the framework used determining consistency in the representation of accounting statements.
The firm management should consider the requirement of the accounting framework in the representation of accounting statement (Booysen, 2008). Without the accounting conceptual framework, the figures in financial statements are materially misappropriated and hence do not show the true and fair view of the companies state of affairs. In accordance with Accounting Standard (AASB 101) the presentation of a company’ s financial statements should comply with the International Financial Reporting Standards. The audit opinion gives an opinion on the financial statements of the compliance with the International Financial Reporting Standards as disclosures. Accounting policies and disclosures Corporations Act 2001 provides policies on the preparation of financial statements.
This rules provided by the standards should in line with the International Financial Reporting Framework. Also to ensure that the financial statement prepared to represent the utmost fair view of the ASIC Company’ s financial condition and those errors that can arise from financial estimation. Consequently, in recognizing measuring and Interpretation of the requirements of Australian Accounting Standard board which are utilized to determine the company’ s comprehensive income statement and balance sheet. ASIC company observes its recognition, measurement and interpretational Australian Accounting Standards requirements such as amortization of intangible assets, depreciation of non-current assets, accounting for income differed tax, impairment of goodwill, and accounting for the companies liabilities.
AASB 101 defines the presentation of debt and equity in the statement of financial position. The ASIC has also issued policies in compliance with the standard to ensure that non-reporting business entities are considered advantageous on concessions and the requirement of International Accounting Standards. The Australian Accounting Standard Board provides transitional provisions that require the entities to follow in accounting for the business transactions and reporting.
Polices limit the chances of risk that can occur due to use of estimates by the company management. This relief ensures that the non-reporting entity takes into account all evenhanded procedures to ensure that the relevancy of financial reports by complying with all recognition and measurement requirements.
Australia, I., 2012. Chartered Accountants Financial Reporting Handbook. pp.42-24.
Booysen, O.B., 2008. Accounting Standards in Brief. Juta and Company Ltd. p.173.
Carmona, S..a.T.M., 2008. On the global acceptance of IAS/IFRS accounting standards: The logic and implications of the principles-based system. Journal of Accounting and Public Policy, 27, pp.455-61.
Chh, 2009. Australian Master Accountants Guide. CCH Australia Limited.
Frank Clarke, G.W.D., 2007. Indecent Disclosure: Gilding the Corporate Lily.
Ron Dagwell, G.L.W.C.L., 2007. Corporate Accounting in Austalia. UNSW Press. p.510.
ASIC Ltd (2012) ASIC Ltd Annual report 2012 Retrieved on 22nd