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fianancial reporting and analysis - Essay Example
Author : valeriereichel
Finance & Accounting
Pages 4 (1004 words)
These standards are created as a unified international business language, so that financial records of organizations can be understood all over the globe. This is because globalization has managed to create an aspect of international shareholding, and international trade…
In 2011, the international accounting standard board revised the existing financial standards, and issued a new set of standard for purposes of reflecting the changes in global business practices, economies of the world, and markets. The new rules are, consolidated financial statement (IFRS 10), joint arrangements (IFRS 11), disclosure of interests other entities (IFRS 12), separate financial statements (IAS 27), and revised associates and joint ventures (IAS 28). The consolidated financial statement (IFRS 10) was created for purposes of outlining the presentations of a consolidated financial statement. This rule requires business organizations to consolidate the entities that are under their control, and this includes giving them the rights of variable returns, and the capability of affecting the returns acquired over an investee (ACCA, 2012). On this basis therefore, the rule was created to institute the values that will guide the preparation of consolidated financial statements when one business organization controls one or more business organizations (ACCA study text, 2011). This rule was created for purposes of defining the concept of control of a business entity, and as a basis of consolidation. ...