Setting Standards for Standard Setting
Article Abstract:
An argument over the issue of overregulation versus underregulation of accounting professionals seems constant. The aim should be directed towards the standard setting process, rather than the regulation issue. The Canadian Institute of Chartered Accountants (CICA) Accountant Standards Committee (ASC) developed a set of accounting standards governing financial reporting. The philosophy underlying the standard setting considered the judgement and leadership of accounting professionals. The standards are not meant to be rules, but rather principles guiding judgment. The ASC is not a regulatory body allowing it to deal with longer-term and objective views of the needs of financial reporting. Attempts at involving both users and preparers in standard setting are made and are successful. The process involves research, discussion and debate. It is somewhat cumbersome, but has a means of reacting quickly when needed. The ASC does not act democratically, with individuals representing their companies or groups, but to transcend those politics. Several alternatives to the ASC setting standards exist, but appear to be either expensive, lacking independence or benefitting one side. The important issue is not the level of regulation, but the soundness of the underlying philosophy and its ability to respond.
Publication Name: CA Magazine
Subject: Business
ISSN: 0317-6878
Year: 1984
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CICA Issues Section 7100 on Auditors and Prospectuses
Article Abstract:
Canada's Auditing Standards Committee (AUSC) is releasing a revision of the section dealing with the auditor's involvement with offerings. Auditor's consent is clarified. The exposure draft was criticized for dating reports, inconsistencies, and the burden placed on auditors. The AUSC changed the wording of consent letters. Assistance to underwriters is warranted, though auditors should be aware of the legal responsibilities they are assuming. Negative assurance letters to authorities can only be written when the audit is substantially completed.
Publication Name: CA Magazine
Subject: Business
ISSN: 0317-6878
Year: 1983
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Disclosures of Variations in the Effective Income Tax Rate
Article Abstract:
The Accounting Standards Committee (ACSC) issued an exposure in 1982 on disclosure of variations in the effective income tax rate. It called for disclosure of reasons for significant variation and significant offsetting items. The benefits of disclosure were deemed to outweigh the disadvantages after receiving responses. Clarification and amendment of examples were done.
Publication Name: CA Magazine
Subject: Business
ISSN: 0317-6878
Year: 1983
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