1
Q
Benefits of accounting standards?
A
- credibility
- comparability
- discipline
2
Q
Cons of accounting standards?
A
- consensus seeking
- overload
- potential economic consequences
3
Q
Who is the standard setter in the UK and what type of standards do they create?
A
Financial reporting council: FRS
4
Q
Who is the standard setters in the US?
A
Financial accounting standards board (FASB)
5
Q
Why are there differences in reporting across nations?
A
- legal systems
- different methods of financing prominent (debt or equity)
- relationship between tax and reporting systems
- the influence of the accounting profession
- historical accidents
- language
6
Q
Who is the international standard setter and what type of standards do they create?
A
Previously IAS, now IFRS
7
Q
Who is the standard setter for small businesses?
A
Financial reporting for smaller entities
8
Q
What is the British conceptual framework?
A
ISAB conceptual framework
9
Q
Qualitative characteristics of financial information?
A
Relevance Reliability Faithful representation Free from bias Complete Comparability Understandability Materiality
10
Q
Why is external reporting regulated?
A
- to help users make decisions
- can help accountants make decisions
- prevent accounting scandals like Enron crash
- supplement to the companies act 1985 which requires companies to provide a true and fair view
ACCU9A4
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