ACC307 AccountingTheory 会计理论 case study assignment 代写

100%原创包过,高质代写&免费提供Turnitin报告--24小时客服QQ&微信：120591129

 
 
 
 
 ACC307 AccountingTheory 会计理论 case study assignment 代写
 

 
 
 
 
 

Unit:                                                       ACC307 –AccountingTheory

 
Weighting:                                Theassignmentisworth40% ofthetotalunitweight.
 
Due date:                 7^th April, 2017
Instructions:
 
1.        Studentsarerequiredtocompletethreecasestudies.
2.        YouranswermustbebothuploadedtoMoodleinwordfileandhandedoveraprintedcopywith signedcoversheet.
3.        Youneed to supportyouranswerswithappropriateHarvard/APAstylereferenceswherenecessary.
4.        Onlyincludeinformationinyourappendixesthathasbeendirectlyreferredtointhebodyofyourdocument.
5.        Includeatitle/cover pagecontainingthesubjecttitleandcodeandthename,studentidnumbers.
6.        PleasesavethedocumentasACC307AT1_firstname_surname
_StudentNumberEg: ACC307AT1_John_Smith_20160000

CaseStudy 1 (1000words)Revisiting theconceptualframework

 
TheFASBandIASBbeganajointagendaprojectto revisittheirconceptualframeworks forfinancial accountingand reportingin2002.Eachboardbases its accountingstandardsdecisions inlargepartonthe foundationofobjectives,characteristics,definitions, andcriteriasetforthintheirexistingconceptual frameworks.Thegoals ofthe newprojectare tobuildonthe twoboards'existingframeworks by refining,updating,completing,andconvergingthem into acommonframework thatbothBoardscanuse indeveloping newandrevisedaccountingstandards.Acommon goal oftheFASBand IASB,sharedbytheirconstituents, is fortheirstandards tobe'principles-based'.Tobeprinciples•based,standardscannotbe a collectionofconventionsbut rathermust berootedinfundamental concepts. Forstandards onvariousissuestoresultincoherentfinancial accountingandreporting,the fundamentalconceptsneedto constitute a frameworkthatissound,comprehensive,andinternally consistent.
 
Withouttheguidanceprovidedby anagreed-upon framework,standardsettingendsup beingbasedontheindividual conceptsdevelopedby eachmemberofthestandard• settingbody.Standardsettingthatis basedonthe personal conceptual frameworks of individualstandardsetterscanproduceagreementonspecificstandard-settingissues onfy when enough of thosepersonalframeworkshappentointersectonthatissue.However, eventhose agreements mayprovetransitory because,as themembership ofthestandard-settingbodychangesovertime,themix of personalconceptual frameworkschanges as well.Asa result,thatstandard-settingbodymay reachsignificantlydifferentconclusionsaboutsimilar(or even identical)issuesthanitdidpreviously,withstandardsnotbeingconsistentwith one anotherandpastdecisions notbeingindicativeoffutureones.Thatconcernisnotmerely hypothetical:substantialdifficultiesinreachingagreement initsfirststandards projectswas a majorreasonthattheoriginal FASBmembersdecidedtodevotesubstantialefforttodevelop aconceptualframework.
 
TheIASBFramework isintended to assistnotonly standardsettersbutalsopreparers of financialstatements (inapplyinginternational financialreportingstandards andindealingwith topics onwhichstandardshavenotyetbeen developed),auditors (in formingopinions about financial statements),andusers (ininterpretinginformationcontainedin financial statements).Those purposesalsoarebetterservedbyconcepts thataresound,comprehensive,andinternallyconsistent.(Incontrast,the FASBConceptsStatementsstatethat they donotjustify changinggenerallyacceptedaccountingandreportingpracticesorinterpretingexistingstandardsbasedon personalinterpretationsof theconcepts,oneof anumberof differencesbetweenthetwoframeworks.)
 
Anothercommongoal of the FASBandIASB istoconvergetheirstandards.TheBoardshave beenpursuinganumberofprojectsthatareaimed atachievingshort-term convergenceonspecificissues,as well as severalmajorprojects thatarebeingconductedjointly or intandem.Moreover,the Boards havealignedtheir agendasmorecloselytoachieveconvergencein futurestandards. The Boardswillencounterdifficultiesconvergingtheirstandardsiftheybasetheirdecisions ondifferentframeworks.
 
TheFASB's current ConceptsStatementsandthe IASB'sFramework,developedmainlyduring the1970sand1980s,articulateconcepts thatgo a long way towardbeing an adequatefoundationfor principles-basedstandards.Someconstituentsacceptthoseconcepts,butothersdonot.Althoughthecurrentconceptshavebeen helpful,theIASBand FASSwillnot be abletorealisefullytheirgoal ofissuinga commonsetofprinciples-basedstandardsif thosestandards arebasedonthecurrentFASSConceptsStatements andIASBFramework.That isbecausethosedocumentsare inneedof refinement, updating,completion,andconvergence.
 
Theplannedapproach inthejointprojectwillidentify troublesomeissues thatseem toreappeartimeandtimeagain ina variety ofstandard-settingprojectsand ofteninavariety of guises.Thatis,thefocuswillbeonissuesthat cutacross anumberofdifferentprojects.Becauseit isnotpossibleto addressthosecross-cuttingissuescomprehensively inthecontext of anyonestandards-level project,theconceptualframework projectprovidesabetterwaytoconsidertheirbroaderimplications,therebyassistingtheboards indevelopingstandards-levelguidance.

Asnotedinthe chapter,theboardshaveissuedandreceivedcommentsonanexposuredraftrelatingtoPhaseAObjectivesandQualitativeCharacteristics.AdiscussionpaperrelatingtoPhaseDReportingEntityhadbeenissued and workiscontinuingon PhaseBElements andRecognitionandPhase CMeasurement.
 
Source:ExcerptsfromHalseyG.BullenandKimberleyCrook, ‘Revisiting theconcepts:  Anewconceptualframeworkproject', M<1y 200'), FASBand11\SB,www.fasb.org  orwww.idsh.org.
 
Questions
1.              Explainwhyprinciples-basedstandardsrequireaconceptual framework.
2.              Whyisit importantthat theIASBandFASBsharea common conceptualframework?
3.              It is suggestedthatseveral partiescanbenefitfromaconceptualframework.Doyouconsiderthataconceptual framework is moreimportant forsomepartiesthanothers?Explainyourreasoning.
4.              Whatis meantby a'cross-cutting'issue?Suggestsomepossibleexamplesofcross•cuttingissues.
 
 
 

CaseStudy 2 (1000words)

 
Thetrendtowardfairvalueaccounting
by J RussellMadray, CPA
 
 
TheDebate
Critics contendthatGAAPisseriouslyflawed.Someintheaccountingprofessiongoso faras to pronouncefinancialstatementsalmostcompletelyirrelevanttothefinancialanalystcommunity.Thefact thatthemarketvalueof publiclytradedfirms on the NewYorkStock Exchange isanaverageoffivetimes theirassetvaluesservestohighlightthisdeficiency.Many reformers,includingFASBchairmanRobertHerz,believethatfairvalueaccountingmustbepart of theanswer tomakingfinancial statementsmorerelevantanduseful.*Advocatesoffair valueaccountingsayit wouldgiveusersoffinancial statements afarclearerpicture oftheeconomicstate ofa company.
Butswitching fromhistorical cost to fairvalue requiresenormouseffort.Valuingassetsin theabsenceofactivemarketscanbeverysubjective,makingfinancialstatementsless reliable.Infact,disputescanariseovertheverydefinitionofcertainassetsand liabilities.
Thecrux of thefairvaluedebate is this:Eachsideagreesthatrelevanceandreliabilityareimportant,but fairvalueadvocates emphasizerelevance,whilehistorical costadvocatesplacegreaterweightonreliability.
Relevanceversus Reliability
Thepertinentconceptual guidance formakingtrade-offs betweenrelevanceand reliabilityisprovidedby FASBConcepts StatementNo.2,QualitativeCharacteristicsofAccountingInformation. Itprovides guidance formakingstandard-setting decisionsaimedatproducinginformationuseful toinvestorsandcreditors. ConceptsStatementNo.2 states:
Thequalitiesthatdistinguish"better" (moreuseful)informationfrom "inferior"(lessuseful)informationareprimarilythequalities of relevance andreliability ...Theobjective ofaccountingpolicydecisionsis toproduceaccountinginformationthatis relevanttothepurposestobeservedandis reliable.
Critics offairvaluegenerallybelievethat reliabilityshouldbethe dominantcharacteristic offinancial statementmeasures.ButtheFASBhas requiredgreateruseoffairvaluemeasurementsinfinancialstatements becauseit perceives thatinformationasmorerelevanttoinvestors andcreditorsthanhistorical costinformation.Inthatregard, theFASBhas notaccepted theviewthatreliabilityshouldoutweighrelevance forfinancial statement

measures.
Somecriticsalsointerpretreliabilityas havingameaningthatdiffers inat leastcertainrespectsfromhowthatterm isdefinedintheFASB'sConceptual Framework.Somecritics equate reliabilitywithprecision,andothersviewitprincipallyintermsofverifiability.However,ConceptsStatementNo.2 defines reliabilityas "thequality ofinformationthatassuresthatinformation isreasonablyfreefromerror orbias andfaithfully representswhatitpurportstorepresent." Withrespecttomeasures,it statesthat "[t]hereliability ofa measurerestsonthefaithfulnesswithwhichitrepresentswhat it purports torepresent,coupledwith an assurance fortheuser,whichcomesthroughverification, that it hasthatrepresentational quality." Thus,theprincipal componentsof reliabilityarerepresentational faithfulness andverifiability.
Althoughtherearereliabilityconcernsassociatedwith fairvaluemeasures,particularly whensuchmeasuresmay notbeable to be observedin activemarkets andgreaterreliancemustbeplaced onestimates ofthosemeasures,present-day financialstatements arerepletewithestimatesthatareviewedas beingsufficientlyreliable.Indeed,presentdaymeasures ofmany assets andliabilities(andchanges inthem) arebasedonestimates,forexample,thecollectability ofreceivables,salability ofinventories,useful livesofequipment,amountsandtiming of futurecashflowsfrom investments,orlikelihood ofloss intortor environmentallitigation.
Eventhoughtheprecision ofcalculatedmeasures such asthose indepreciationaccountingis notopentoquestionsincetheycanbecalculateddown tothe penny,thereliability of thosemeasuresisopen toquestion.Precision,therefore,isnot a componentofreliabilityunderConcepts StatementNo.2.Infact,ConceptsStatementNo.2 expressly states thatreliabilitydoesnotimplycertainty orprecision,andadds thatanypretension tothosequalities ifthey donotexist isa negationof reliability.
*RobertH.Herz'sremarkstotheFinancialExecutivesInternational CurrentFinancialReportingIssuesConference,NewYorkHiltonHotel,November4,2002.
Source:Excerptsfrom‘Thetrendtowardfairvalueaccounting',Journal of FinancialServiceProfessionals,May2001,pp. 16-113.
 
 
Questions
1.         Whatyouthinkis thefundamentalproblem with financialstatements baseduponthehistoriccostmeasurementprincipleusedunder USGAAP?
2.         What doyouthink ofthe principle'... accountsmustreflecteconomic reality'asacoreprincipleofmeasurementinaccounting?
3.         Howwould youmeasure economic reality?
4.         Whatisreliability in accounting?
 
 
 ACC307 AccountingTheory 会计理论 case study assignment 代写
 

CaseStudy 3 (1000words)

 
 
Disclosureofenvironmentalliability
byLindenePattonC.l.H.,Seniorvice-presidentandcounsel,Zurich

Aroundtheworld, companiesarebeingrequiredtomeethigherlevels ofdisclosureofenvironmental liability...Inthe UnitedStates,for example, the USFinancialAccountingStandardBoard(FASB)issuedprovisionsin2002for accountingforenvironmentalliabilitiesonassets beingretiredfrom service.Theprovision foraccounting forassetretirementobligationsrequiredcompaniestoreserveenvironmental liabilitiesrelatedto the eventualretirement ofanasset ifitsfairmarketvaluecould bereasonablyestimated.
Theintent of therulingwas disclosure,butthe conditional nature ofestimatinga fairmarketvaluecausedcorporations totaketheposition that theycoulddefertheirliabilityindefinitely by'mothballing' a contaminatedproperty.Companieseffectivelypostponedtherecognitionoftheirenvironmentalliabilitiesin the absence ofpendingoranticipatedlitigation.
Earlierthisyear,FASBclarified its intentionby providing aninterpretationthatsaidcompanieshavealegalobligation toreserveforenvironmental andotherliabilities associatedwiththeeventual retirement ofmanufacturingfacilities or parts of facilities,evenwhenthetiming ormethodofsettlementisuncertain.AmongexamplesgivenbyFASB:
•                      Anasbestos-contaminatedfactorycannotsimply be'mothballed' withoutadequatereservesto coverthe eventual costof removing theasbestos
•                      Reservesmustbeestablishedtodayfortheeventualdisposalof still-in-use,creosote•soakedutilitypoles
As a resultof whatmay seem like aminortechnicalre-interpretation,companies mayhavetorecogniseimmediatelymillionsofdollarsinliabilities intheirincomestatementstocomplywiththis change.
In Europe,regulatorshavealsoinitiatedeffortsto promotedisclosure.In2001,the EuropeanCommissionpromulgatedtougher,non-bindingguidancefordisclosingenvironmentalcostsandliabilities,andvariouscountriesinEuropehaveissuedadditional requirementsrelated to environmentaldisclosure. In 2002,theCanadianInstituteofCharteredAccountantspublishedvoluntaryguidancethatstressedtheimportanceofdisclosingallmaterialrisks,including environmentalliabilities,incompanies'annual reports.
Somefinancialinstitutionshave alsopledgedto adheretotenets ofinternational initiativessuchas theEquatorPrinciples, whichfactorenvironmental andsocial considerationsintoassessingtheriskofaproject.Also,a groupofpensionfunds,foundations,EuropeaninvestorsandUSstate treasurershaveendorsedUNefforts topromote a minimumlevel ofdisclosure onenvironmental,social andgovernanceissues.
Recognition ofenvironmental liabilitiesmayalsosoon emerge as anissue forcompanies inAsia.Whileenvironmentalissuesmayhave takena backseat to rapideconomicdevelopmentover thepast 20 years,thatsituationmay changeas legislationandregulationcatch upwithdevelopment.
Theresponsibility for disclosingfuture environmentalliabilityisclearly a growingissue forcompaniesaroundtheworld.However,accurately estimatingcleanupcosts isnotaneasy task duetounknowncontaminants,legacyliabilitiesrelatedtoformerlyoperated property,regulatory changes orunexpectedclaimsrelatedtonaturalresourcedamage.
 ACC307 AccountingTheory 会计理论 case study assignment 代写
 
Questions
1.       ThearticlestatesthattheUSstandardsetterFASBrequirescompanies torecord a provisioninrelationtoenvironmentalcostsof retiringan asset ('toreserveenvironmental liabilities')ifits fairvaluecouldbe reasonablyestimated.Howdo youthinkcompanieswould go aboutestimatingsuch aprovision?