Principles of Accounting
ACCT 112: PRINCIPLES OF ACCOUNTING 1
ACCOUNTING THEORY NOTES
(a) International Accounting Standards and International Financial Reporting Standards.
The foreword to accounting standards defines Accounting Standards as Authoritative statements of how particular types of transaction and other events should be reflected in financial statements. Accounting Standards are developed to achieve comparability of financial information between and among different organizations. International Accounting Standards (IAS’s) and International Financial Reporting Standards (IFRS) are meant to apply to most organizations in the world. IAS’s and IFRS’s are produced by the International Accounting Standards Board (IASB) whose objectives are: (a) To formulate and publish in the public interest accounting standards to be observed in the presentation of financial statements and to promote their worldwide acceptance; and (b) To work generally for the improvement and harmonization of regulations, accounting standards and procedures relating to the presentation of financial statements.
The IASB is an affiliate of the International Federation of Accountants (IFAC) established in 1977 which co-ordinates the Accounting profession worldwide. Most accounting bodies of countries are members of IFAC.
The IASC develops IAS’s through an international process that involves the worldwide accountancy profession, the preparers, users of financial statements and national standard setting bodies and other interested parties.
The IASB sets up a steering committee to develop a statement of principles, an Exposure Draft and ultimately an Accounting Standards once a new topic is suggested. The process includes:
* Identifying and reviewing of all the issues associated with the topic, * Studying national and regional accounting requirements and practice, consultation with the member bodies’ standard setting bodies and other interested groups, * Public Exposure of the draft
ACCOUNTING THEORY NOTES
(a) International Accounting Standards and International Financial Reporting Standards.
The foreword to accounting standards defines Accounting Standards as Authoritative statements of how particular types of transaction and other events should be reflected in financial statements. Accounting Standards are developed to achieve comparability of financial information between and among different organizations. International Accounting Standards (IAS’s) and International Financial Reporting Standards (IFRS) are meant to apply to most organizations in the world. IAS’s and IFRS’s are produced by the International Accounting Standards Board (IASB) whose objectives are: (a) To formulate and publish in the public interest accounting standards to be observed in the presentation of financial statements and to promote their worldwide acceptance; and (b) To work generally for the improvement and harmonization of regulations, accounting standards and procedures relating to the presentation of financial statements.
The IASB is an affiliate of the International Federation of Accountants (IFAC) established in 1977 which co-ordinates the Accounting profession worldwide. Most accounting bodies of countries are members of IFAC.
The IASC develops IAS’s through an international process that involves the worldwide accountancy profession, the preparers, users of financial statements and national standard setting bodies and other interested parties.
The IASB sets up a steering committee to develop a statement of principles, an Exposure Draft and ultimately an Accounting Standards once a new topic is suggested. The process includes:
* Identifying and reviewing of all the issues associated with the topic, * Studying national and regional accounting requirements and practice, consultation with the member bodies’ standard setting bodies and other interested groups, * Public Exposure of the draft