Summary Key topics Financial Accounting and Reporting (324059-M-6)
10 views 0 purchase
Course
Financial Accounting And Reporting (324059M6)
Institution
Tilburg University (UVT)
Key topics of the course Financial Accounting and Reporting (324059-M-6), Master Accountancy, Tilburg University. Easy to study summary that contains all important points from the course, clearly divided by IFRS and IAS topics like IFRS 16 Leases, IAS 36 Impairment of assets etc.
The need for ● Cross-listings (costly and confusing)
“international” accounting ○ Cross-listed companies had to present
standards separate financial statements for each market
● Foreign investments (attract foreign investors)
○ Foreign investors are not/less familiar with local
GAAP
Why not one set of Advantages
accounting rules for all ● Cuts compliance costs for firms
types of companies? ● Easier access to international capital
● Increase attractiveness of local capital markets
● Increases comparability of international financial
statements
Disadvantages
● Lack of influence for local governments
● More flexibility (no country specific situations)
● Enforcement of rules is still a local responsibility
● Different general objectives of financial accounting
IFRS IFRS Institutional Background
Consolidated accounts (a) has a majority of the shareholders' or members'
when a parent voting rights in another undertaking (a subsidiary
undertaking: undertaking) OR
(b) has the right to appoint or remove a majority of the
members of the administrative, management or
supervisory body of another undertaking (a
subsidiary undertaking) and is at the same time a
shareholder in or member of that undertaking. OR
(c) has the right to exercise a dominant influence over
an undertaking (a subsidiary undertaking)
IFRS adoption in Europe ● Listing criterion: Public listing of securities on a
regulated market (No difference between equity and/or
bond issuers)
● Group criterion: Parent undertaking
Three pillars of IFRS in ● Standard Setting - IASB
Europe ● Endorsement - giving approval, support
● Enforcement - compliance with law / regulation
IASB Standard Setting To develop, in the public interest, a single set of high quality,
understandable, enforceable and globally accepted financial
reporting standards based upon clearly articulated principles
IASC to IASB IASC
● Initiative: Auditing companies
● Private standard-setting organization
● Developed International Acc Standards (IAS) 1 to 41
IASB
, ● IFRS Foundation as organizational structure
● Developed International Financial Reporting Standards
(IFRS) 1 to 17 (as of Apr. 2022)
IFRS Foundation: 1. IFRS Foundation Monitoring Board - Public
Three-tier structure accountability
2. IFRS Foundation Trustees - Governance, strategy &
(IFRS Advisory Council oversight
provides advice to 3. IASB and ISSB - Independent standard-setting &
Trustees, IASB, ISSB) related activity
Due process IASB holds public hearing on proposed accounting standards
● Agenda consultation - define priorities (3-5 year)
● Research programme - ideas in discussion paper
● Standard-setting programme - exposure draft for
public consultation
● Maintenance programme - to identify any
implementation or application problems
Endorsement - the IAS ● they are not contrary to the [European true and fair
can only be adopted if: view] principle and,
● are conducive to the European public good and,
● they meet the criteria of understandability, relevance,
reliability and comparability required of the financial
information needed for making economic decisions
and assessing the stewardship of management.
- SARG and EFRAG give advice to EU Commission
- ARC votes on endorsement of IFRS standards in
European Union
In general, accounting standards are not altered during the
endorsement process, exeptions:
● hedge accounting
● fair value accounting
Enforcement ESMA, SEC, AFM, Auditing
CF Conceptual Underpinnings of IFRS
IFRS Conceptual Serves as a foundation for the development, application, and
Framework interpretation of IFRS standards
“The objective of general purpose financial reporting is to
provide financial information about the reporting entity that is
useful […] in making decisions […]”
Purpose of financial ● Distribution function (earnings, taxable income)
reporting ● Information function (investors, management etc)
● Other functions
The benefits of buying summaries with Stuvia:
Guaranteed quality through customer reviews
Stuvia customers have reviewed more than 700,000 summaries. This how you know that you are buying the best documents.
Quick and easy check-out
You can quickly pay through credit card or Stuvia-credit for the summaries. There is no membership needed.
Focus on what matters
Your fellow students write the study notes themselves, which is why the documents are always reliable and up-to-date. This ensures you quickly get to the core!
Frequently asked questions
What do I get when I buy this document?
You get a PDF, available immediately after your purchase. The purchased document is accessible anytime, anywhere and indefinitely through your profile.
Satisfaction guarantee: how does it work?
Our satisfaction guarantee ensures that you always find a study document that suits you well. You fill out a form, and our customer service team takes care of the rest.
Who am I buying these notes from?
Stuvia is a marketplace, so you are not buying this document from us, but from seller AccUVT. Stuvia facilitates payment to the seller.
Will I be stuck with a subscription?
No, you only buy these notes for $4.33. You're not tied to anything after your purchase.
