In a recent issue of this journal, Argilés and Slof (
2001
) analysed the main features of the European Farm Accountancy Database Network (FADN) against the backdrop of IAS 41, the new international ...accounting standard on agriculture, and arrived at the conclusion that FADN offers an excellent tool for operationalizing IAS 41 in European farms. The present study revisits some of the key issues in Argilés and Slof's paper in a wider international context and highlights their implications for the harmonization of farm accounting practices around the world. In particular, this paper contends that there are some key provisions of IAS 41 that are incompatible with the European Union Fourth Directive which Argilés and Slof (
2001
, p. 364) apparently overlooked by focusing only on aspects of the directive that sanction current value measurement and ignoring those that relate to the treatment of associated holding gains or losses. Furthermore, this paper also demonstrates that Argilés and Slof's argument that simplicity is another improvement of IAS 41 vis-à-vis the French Plan Comptable Général Agricole is flawed. Indeed, it is shown here that it would be virtually impossible to implement IAS 41 in Francophone countries in the absence of a fundamental revision, if not complete abandonment, of the plan comptable, at least in view of major conceptual differences between the notions of income, production and value added espoused by national statisticians and those enshrined in IAS 41.
This article considers the financial reporting aspects concerning subsequent events using a case study type scenario, and will then discuss the auditing requirements that all the professional ...auditors need to be aware of. Financial reporting aspects relating to events after the reporting period are analyzed in the first part of the article. The second part of the article will consider the auditor's responsibility in relation to ensuring all events occurring between the reporting date and the (expected) date of the auditor's report have been adequately taken into consideration and sufficient appropriate audit evidence have been gathered to achieve the objectives. Subsequent events are and will continue to be a key area in audits and it is crucial that all those involved in the process have an understanding of the types of audit evidence that the auditor should obtain to confirm that the accounting and disclosure requirements (particularly in IAS 10) have been applied correctly within the financial statements.
Zusammenfassung
Die Bilanzierung von Pensionsverpflichtungen basiert auf der Verwendung zahlreicher Schätzparameter, deren zukünftige Entwicklung zu Bewertungszwecken prognostiziert werden muss. ...Weichen die tatsächlich eintretenden Realisationen dieser Parameter von den ursprünglichen Schätzwerten ab, entstehen sogenannte versicherungsmathematische Gewinne und Verluste. Zu deren bilanzieller Erfassung stellt der aktuelle IAS 19 drei Alternativen zur Verfügung. Insbesondere die in der Praxis häufig angewendete erfolgsneutrale Erfassung und die Korridormethode unterstellen dabei implizit, dass sich die versicherungsmathematischen Gewinne und Verluste langfristig ausgleichen. Verschiedene Arbeiten kommen jedoch auf Basis der Monte-Carlo-Simulationstechnik zu dem Ergebnis, dass dieser langfristige Ausgleich gerade nicht gewährleistet ist. Diese Arbeiten bleiben aber eine Begründung für das systematische Entstehen versicherungsmathematischer Gewinne und Verluste schuldig. Der vorliegende Beitrag liefert eine analytische Begründung für dieses systematische Auftreten und kommt zu folgenden Ergebnissen: Ein langfristiger Ausgleich der versicherungsmathematischen Gewinne und Verluste ist nur dann gewährleistet, wenn die zu schätzenden Bewertungsparameter unabhängig voneinander sind. Für den realistischen Fall eines Bestehens von Abhängigkeiten zwischen den Bewertungsparametern ist diese Annahme dagegen nicht haltbar. Im Falle einer positiven Korrelation zwischen den Bewertungsparametern entstehen vielmehr systematisch versicherungsmathematische Verluste, im Falle einer negativen Korrelation versicherungsmathematische Gewinne.
International Accounting Standard (IAS) 14 on segment reporting was revised in 1997. IAS 14R substantially changed segment reporting requirements in response to numerous criticisms of the original ...standard. The objective of this study is to determine how IAS 14R affected the segment disclosure practices of companies claiming to comply with IAS.
This paper examines the following questions: (1) What items of information are disclosed under IAS 14 and IAS 14R? Was there a gain or a loss of information disclosed for business and geographic segments with the implementation of IAS 14R? (2) Has the number of business and geographic segments reported by companies changed with the implementation of IAS 14R? (3) Are companies disclosing the items required by IAS 14R? (4) Are companies' segment reporting practices related to size, country of domicile, industry, international listing status, and having a then-Big Five auditor?
We find that the impact of IAS 14R is mixed. Companies are responding to IAS 14R, but not wholly embracing it. Our findings suggest that companies audited by a Big Five (now Big Four) firm and, to a lesser extent, companies that are larger, listed on multiple stock exchanges, and from Switzerland have greater compliance with IAS 14R than other companies in our study.
Gary K. Meek, Oscar S. Gellein/Deloitte & Touche Professor, School of Accounting, College of Business Administration, Oklahoma State University, Stillwater, OK 74078-4011, USA. E-mail: gmeek@okstate.edu
AASB 138 Intangible Assets, adopted by reporting entities in Australia for annual reporting periods beginning on or after 1 January 2005, required derecognition of internally generated intangible ...assets. Prior to its adoption, the standard was widely expected to have a substantial impact on the reports of affected listed entities. On the basis of information available in the 2004/05 annual reports, this paper projects the expected effects of AASB 138 on reported intangible assets and on key financial measures. It compares these projected measures to the realised measures, reported under both Australian GAAP and AIFRS in the 2005/06 reports. While reported intangible assets and the debt to equity ratio were expected to change significantly as a result of AASB 138, the reported AIFRS results show a significant change in only the debt to equity ratio. The paper considers reasons why the pre‐adoption expected changes did not eventuate, and also how the actual changes were reported to stakeholders in the management discussion sections of the annual reports. The conclusion draws implications regarding the transparency of communication in annual reports.
Purpose - The purpose of this paper is to contemplate the degree to which Singaporean firms comply with the highly technical disclosure requirements required under International Accounting Standards ...(IAS) IAS 36 specific to goodwill impairment testing.Design methodology approach - The adoption of IAS in Singapore from 1 July 2004 introduced a highly technical standard (financial reporting standards - FRS 36) which has challenged many preparers. While it is generally accepted that accounting compliance may be suboptimal in transition periods as preparers accommodate change, it is assumed compliance quality improves with the passage of time. This study examines compliance of the largest 168 Singaporean goodwill-intensive firms over a three year period, 2005-2007, to interrogate compliance quality post-transition.Findings - The paper reports distinctly poor compliance systemically over the three years across many facets of goodwill impairment testing disclosures including cash-generating unit (CGU) definition and goodwill allocation, and key input variables used in estimating CGU recoverable amounts.Practical implications - The results raise questions about the quality of accounting information among goodwill-intensive firms in Singapore and the robustness of regulatory oversight institutions operating within Singapore.Originality value - The paper illustrates a novel approach to examining the issue of accounting quality under IFRS by examining compliance quality through large sample time-series analysis focusing on note-form disclosures.
