Accountants and the seven year itch

Article Abstract:

Two conceptual frameworks for financial accounting have been developed, including the International Accounting Standards Committee's Framework for the Preparation and Presentation of Financial Statements, and Professor Solomons' Guidelines for Financial Reporting Standards. The frameworks take different directions toward the development of a common conceptual framework for accounting. For instance, the IASC believes that prudence requires accountants to overestimate liabilities and underestimate assets while Solomons argues that such a treatment compromises accuracy and promotes biased reporting. Additionally, Solomons' model is based on value to the business, financial capital maintenance concept, and stabilized pounds while the IASC does not favor any particular model.

Reports, Institute of Chartered Accountants in England and Wales, International Accounting Standards Board

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ASB - time the talking stopped

Article Abstract:

The UK Accounting Standards Board (ASB) goes into operation on 1 Aug 1990, superceding the Accounting Standards Committee (ASC) which lost its effectiveness through controversy. Like the ASC, the ASB lacks the statutory authority to enforce standards. In order for the ASB to be a success, it must be able to persuade the preparers and users of financial statements that the approaches delineated by the ASB are correct and must distinguish itself from the failed ASC immediately. Issues to be addressed by the ASB include reviewing of all standards, exposure drafts, and Statements of Recommended Practice of the ASC, implementing of a quick response mechanism as suggested by the Dearing Report, and delineating the ASB's approach to accounting standards.

Accounting Standards Board

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Fixed assets: the lull before the storm

Article Abstract:

The Accounting Standards Committee's pending fixed assets exposure draft may prove to be very controversial. The exposure draft will deal with revalued fixed assets accounting, capitalization of borrowing costs, and intangible assets accounting. The main controversies may arise over the Committee's choice of maintaining or changing the current handling of revaluations which allows companies to decide what they are going to revalue, when they are going to revalue it, and how they are going to revalue it. If the Committee opts to change the rules, they will probably revert to requiring companies to incorporate revaluations on balance sheets. However, many companies would prefer to use comprehensive disclosure instead.

Laws, regulations and rules, Accounting and auditing, Fixed assets

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