All the listed companies were asked to follow these accounting standards for maintaining their accounting transaction and developing financial reports. These accounting standards were introduced to enhance credibility and reliability of the financial statement developed by the listed companies of a nation. These accounting standards assisted the accountants and auditors to resolve different controversies related to different accounting practices. Even the managers consider these accounting policies while developing various strategies and policies to be followed by the company.
Like other developed nation, the accounting standards were formulated in UK in early 1980s. People identified the necessity of a well structured accounting standard that assures “relevance, reliability, comparability and understand-ability” in the financial report that is developed by the listed companies (Kirk, 2005, p.9).
In UK, the accounting standards are popularly known as Financial Reporting Standards (FRS). These FRS were developed by Accounting Standards Boards (ASB) and all the listed companies are required to adhere to these standards so that a true and fair picture of the companies’ financial condition can be represented.
Prior to 1990, the accounting standards were developed by Accounting Standards Committee (ASC) which was later replaced with Accounting Standards Boards (ASB). In the first meeting of ASB, it formally accepted all the accounting standards prevailing in UK GAAP. With time, this board introduced few new standards and modified many existing standards.
In UK, the four main constituents responsible for development and maintenance of accounting standards are Financial Reporting council (FRC), The Accounting Standards Board (ASB), Urgent Issues Task Force (UITF) and The Financial Reporting Review Panel (FRRP). FRC is ...
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The essay discusses the challenges faced by International Accounting Standards Board in accomplishing its mission of introducing international financial reporting standards for general purpose financial statements. It further discusses about the key characteristics of International Accounting Standards Board’s framework.
2. Tax authorities Tax authorities want to determine the extent to which filed tax returns are credible (Webster, 2004). 3. Creditors Creditors want to determine an organization’s credit worthiness. They give credit according to their customer’s level of financial health.
Standard systems of reporting provide transparency for investors, creditors, management, and government. Thus, regulation and enforcement provide a degree of security for investors and protect honest businesses.
In Kuwait, the evolution of financial reporting began in the late 50s with the growth of the business sector.
To support such changes, companies have altered their management accounting practices to adapt to the ever changing environment. There is sufficient research done by the authors discussed in this work, to support such a statement.
It is the presentation of financial data relating to the performance, position as well as the flow of assets in a given accounting period which is then conveyed to different users of accounting information in order to facilitate their decision-making process. The sole objective
uch information is subject to different laws and regulations in various countries, which influence the content and the format for preparing the financial statements. In response to the existence of different accounting practices, the International Accounting Standard has
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