Premium Essay

Accounting Issue Outline

In: Business and Management

Submitted By coolie57
Words 340
Pages 2
Accounting Issue: Financial Reporting * Comprehensive Income * Issued to address the presentation of certain items that bypass the income statement and were recorded directly to equity * Focused on net income would not take into account comprehensive income items in measuring financial performance * Bypassed the incomes statement: recorded directly to stockholder’s equity * Foreign currency matters * Derivatives and hedging * Compensation –Retirement benefits. * Prior to ASC 220 entities were required to present only the accumulated balances in the statement of stockholder’s equity. To date, ASC 220 has required that comprehensive income be presented in financial statements. * ASC 220 must be reported one of three ways * Present separate statement of comprehensive income. * Combine statement of income & comprehensive income * Present comprehensive income as a section within the statement of stockholder’s equity. * GAAP vs IFRS * GAAP * Does not require a consecutive presentation of statement of income and comprehensive income. * Presents three alternatives of presenting comprehensive income * Separate statement * Combined statement with income statement * As part of the statement of changes in stockholders equity * IFRS * Presents two alternatives of presenting comprehensive income * Separate statement * Combined statement with income statement * Requires consecutive presentation of statement of income and comprehensive income. * According to FASB removing certain presentations options will make it easier to compare comprehensive income used within GAAP vs IFRS. * Key Changes * Reclassification…...

Similar Documents

Premium Essay

Cost Accounting Issue

...GULU UNIVERSITY FACULTY OF BUSINESS AND DEVELOPMENT STUDIES DEPARTMENT OF FINANCE AND ACCOUNTING BACHELOR OF BUSINESS ADMINISTRATION (BBA) COST AND MANAGEMENT ACCOUNTING (BBA 314) COURSE WORK SEMESTER ONE: 2012/2013 Henry Egyeyu 07/U/456/BAK/PS Tel: +256774366667/+256714366667 Question: Accounting theory and practices have identified financial management, financial accounting and management accounting as distinct entities and granted them independent status. Unfortunately, cost accounting which also appears to many users of accounting data and information as fit to be an independent stream of knowledge, has been denied this opportunity. In many circles, this is considered a very unfair treatment and must be corrected if the accounting discipline has to meaningfully grow. As an upcoming professional in the field, develop a logical position on the cost accounting issue relating it to a practical scenario (case study) in Uganda. Your argument should be presented inform of a report addressed to: Director, cost concern international (Uganda chapter) P.o. Box 17 Kampala Important Response Information: i. The report must be 6-7 (six to seven) pages, well-edited. ii. Strictly use Times New Roman fontage, Font size 12, and 1.5 spacing iii. You must sign the report and provide your phone contact. iv. The report must be submitted within exactly 30 (thirty) days from the date of receipt. Henry & Egyeyu Consultancy P.o box 26031, Gulu 1st October,......

Words: 2961 - Pages: 12

Premium Essay

Key Issues in Cost Accounting

...Introduction and background Cost accounting is the process of accumulating, measuring, analyzing, interpreting and reporting of the information related to the cost. This type of process is useful and relevant for all internal and external stakeholders of the business entity. In the management accounting, the term cost accounting includes the works of establishing budget and actual cost of operations, processes, departments, analysis of the variances and profitability or social use of the funds. In the external stakeholders we include all those who have invested money in the company, such as banks, financial houses, investors and others. Internal stakeholders are those people who work within the premise of the company, such as business or company directors, division heads and managers. Cost accounting has long been used to help managers understand the costs of running a business. Modern cost accounting originated during the industrial revolution, when the complexities of running a large scale business led to the development of systems for recording and tracking costs to help business owners and managers make decisions. In the early industrial age, most of the costs incurred by a business were what modern accountants call "variable costs" because they varied directly with the amount of production. Money was spent on labor, raw materials, power to run a factory, etc. in direct proportion to production. Managers could simply total the variable costs for a product and use......

Words: 3232 - Pages: 13

Premium Essay

Emission Allowances and the Related Accounting Issues

...Emission allowances and the related accounting issues Laura Chilian April 5, 2012 For many years, the Securities and Exchange Commission (SEC), and the International Financial Reporting Standards (IFRS), tried to establish a proper accounting treatment for emission allowances. The mechanism for these credits is based on a simple ‘cap and trade’ idea. The government issues a number of credits to each company based on the amount of greenhouse gases emitted. Issuing a lower number of credits than needed creates scarcity, which makes trade possible. Companies that emit more gases than they were allowed will pay a fine or buy more credits. Situations are reversed if companies use less credits than they should have. This creates a market-based system on an international level (“Emission Trading Schemes” 2). The first accounting conflict arises from the nature of these allowances. They could be considered assets held for use, grants from the government for the value of the allowances, or a liability/promise to deliver allowances equal to the emissions that have been made. Considering this, emission allowances can not be categorized as either net assets or net liabilities. Due to the lack of authority, accounting practitioners create diversity (“Emission Trading Schemes” 5). Two models or treatments are developed to account for these rights. 1) The inventory model: when...

Words: 1173 - Pages: 5

Premium Essay

Health Care Economics Issues Outline

...* Health Care Economic Issues Outline * I. Introduction A. More than 50 million uninsured in the United States (Young, 2012) B. Uninsured population is considered vulnerable population C. Uninsured use emergency department to meet their primary health care needs D. Overcrowded emergency departments require reallocation of resources * II. Effectiveness of the Current Procedures in Place * A. Federal Emergency Medical Treatment and Labor Act (EMTALA) requires hospitals * to treat every patient irrespective of the payer source B. Limited community resources forces uninsured population returning to emergency department for minor ailments C. Shrinking federal and state funding for medical assistance programs D. Current procedures do not address medical needs of the undocumented populations * E. Treating uninsured costs taxpayers more than $175 billion per year (KFF, 2008) F. Hospitals absorb more than $65 billion dollars per year in uncompensated care III. Affects of financial decision-making process A. Express/Urgent Care areas added to emergency B. PA added to Triage to treat minor health issues C. Sponsor Care Funds Created 1. Hospitals have created sponsor care programs designed to help alleviate the amount of debt created by an insured patient.  The funding for sponsor care programs comes from direct donations from the community and are meant specifically for patients that are......

Words: 1600 - Pages: 7

Premium Essay

Principle Accounting, and Recognition and Measurement Issues

...DEFENCE OF HISTORICAL COST ACCOUNTING i. Historical cost is relevant in making economic decisions. * Ijiri present 3 reasons historical cost is relevant for making decision * It effect the evaluation n selection of decision rules. It used the past info to measures the quality of their past decisions. * Provides input for satisficing notion where some managers make decisions that will support expected or satisfactory outcome. They are consider how much has already earned rather than how much mote they can earn. * It is used bcoz it imposed on decision makers by their environment. Eg: taxation decision n cost plus contract. ii. Historical cost is based on actual, not merely possible transaction. * Record done based on actual transactions made. * Ijiri- it possible to prepared a balance she on the basis of year-end market price without references to actual transactions. * Historical cost provides evidences for determining how efficiency management has meet their responsibilities. iii. Through history, FS based on historical cost have been found to be useful. * Mautz – “if whose who make management n investment decision had found financial reports based on historical cost useful over the years, changes in acctg would long since have been mad” iv. The best understood concept of profit is the access of selling price over historical cost. * People understand the basic notion of actual cost compared to...

Words: 3307 - Pages: 14

Premium Essay

Accounting Issue Memo

...accounting issue memorandUM to: Audit files FROM: [YOUR NAME], MEMBER OF AUDIT TEAM FOR PARKER & PROCK APPROVED BY: FRANK REEDY, ENGAGEMENT MANAGER ON AUDIT FOR PARKER & PROCK SUBJECT: TREATMENT OF MANUFACTURING OVERHEAD COSTS AT PARKER & PROCK FOR YEAR ENDING DECEMBER 31, 2013 DATE: JANUARY 16, 2014 CC: CLAIRE ALLYSON, CONTROLLER, PARKER & PROCK In performing the audit planning for the audit of Parker & Prock (P&P) for the year ending December 31, 2013, we discovered that P&P has an accounting policy that results in only direct manufacturing labor and direct material costs being included in the cost of manufactured inventory. Furthermore, this accounting policy results in all other costs, including those properly categorized as “manufacturing overhead,” being accounted for as period costs that are being expensed as incurred. This accounting policy has the effect of understating inventory balances at period end and as well as understating the cost of goods sold and overstating operating expenses for the period. P&P is a private company. Prior to undertaking tests of inventory balances, we determined that a review of P&P’s inventory accounting policy was warranted. The subject of this review is to research whether P&P’s treatment of manufacturing overhead is in accordance with generally accepted accounting principles (GAAP). In performing our research we used the FASB Accounting Standards Codification (the Codification). Within the Codification we......

Words: 600 - Pages: 3

Free Essay

Financial Accounting Issues

...With the spate of recent corporate failures there have been increased criticisms and calls for regulatory reform of existing accounting and auditing practices. The issue of regulation within the accounting profession has been highly contentious and led to many debates. Those in favour of a free-market stress that market forces will optimise the allocation of resources and as such regulation is not necessary. Whilst those opposing this view believe that markets are imperfect and as such outside intervention in the form of regulation is required. Both sides hold valid arguments as to why regulation is or is not necessary and this paper shall examine these opposing views before providing an informed opinion. The anti-regulation or free-market approach to accounting is one that has been subscribed to for many years. The main thrust of the American Institute of Accountants in 1934 was anti-regulation, they stressed that, “no attempt [should be made] to restrict the rights of corporations to select detailed methods of accounting deemed by them to be best adapted to the requirements of their business” (May 1934, 80). The argument behind this notion is that the natural market forces or the “invisible hand” of the market will ensure self-regulation. Ross (1979, 379) implies this when he writes, “…disclosure regulations are generally neither required nor desirable, since left on their own, firms will have incentives to report accurately”. The belief that firms have internal......

Words: 1591 - Pages: 7

Premium Essay

Accounting Issues

...for asset) | | | | | | | | | 30-06-21 | | Cash | | | 8000 | | | | Executory expense recoupment | 1000 | | | Interest revenue | | | 3131.73 | | | Lease receivable | | | 3868.27 | | | (to record receipt of lease payment) | | 5) According to Deegan(2013) disclosure requirements for lessee and lessors have different criteria’s. PART 2 IAS\AASB 117 are both equivalent to that of the rules and regulations issued by the International Accounting Standards Board(Jesswein, 2009). As stated in AASB 117, the purpose is to assist entities in classifying leases as operating or finance leases and to state the appropriate accounting policies with regards to leases(ICAA, 2012). And to also, set a guideline in the disclosure requirements in respect to the lease agreement. Stated in Pounder (2009) a lease agreement specifies the property to be leased, term of lease and payments detailing the amount to be made by the lessee to the lessor. Whereas, the International Accounting Standards Board or shortly known as IASB is a self-governing private body that helps expands and approves International Financial Reporting Standards(AASB, 2010). IFRS which has been adopted by most countries around the world has raised many intense political and legal aspects. The adoption of this process will most definitely affect various users which can vary from preparers, auditors and users (Nobez and Zeff, 2010). The dramatic change towards the acceptance of global......

Words: 1461 - Pages: 6

Premium Essay

Ethical Issues in Accounting

...Ethical Issues in Business and Accounting Barbi Hammond October 31, 2010 Ethical Issues in Business and Accounting The business and accounting worlds are full of ethical dilemmas and scandals. The works of great philosophers of the past can be directly applied to current situations in today’s business and accounting ethical situations. David Hume is one of the philosophers whose works could be applied to the business world today. David Hume was a Scottish philosopher. Hume introduced the moral philosophy known as metaethics. Metaethics refers to the study of moral language and its meaning. (Gaffikin, 2007.) Metaethics focuses on the following questions: * semantic questions such as the meaning of moral terms such as good, right and ought; * logical questions such as the (syllogistic) validity of moral arguments; * ontological questions such as the existence of moral facts; and * epistemological questions such as the possibility of moral knowledge and, if so, the scope of such knowledge Hume felt that although moral beliefs hold meaning they are not logical thought. According to Hume morals are psychological thoughts and can’t be taught. Hume’s theory regarding morals can be tied to the business world in many ways. The most prominent of these would be an organizations decision to hire someone with a history of less than reputable behavior in hope that the person has learned the error of their ways. According to Hume, this person cannot be reformed...

Words: 724 - Pages: 3

Premium Essay

Financial Accounting Issue regarded as one of the most important topic in accounting. However, it is most difficult issues that standard setters and accountants must deal with regularly because the accounting standards and rules are changing all the time for improving the quality of accounting, which also explains why there are so many changes over these two decades on Australian Accounting policy. This report will focus on some accounting policies regarding to recognition of revenue from the contracts with customers, its history before the adoption of international financial reporting standards (IFRS). Also, current standards and the convergence between IFRS and US GAAP in future will be discussed. There are some drawbacks and ambiguity on the earlier accounting standard to recognize revenue, therefore it is understood that the international accounting standard board (IASB) and Financial Accounting Standard Board (FASB) are currently working on the policy relating to the recognizing revenue from the contracts with customers. They have decided that the ultimate goal of the convergence is a single set of high-quality, international accounting standards that both domestic and international companies can use. Once the convergence is bringing U.S. GAAP and IFRS closer together in a few years, Australian entities may be influenced by the new proposals. It would be a challenging task for companies because it is difference from the two current accounting standards for recognizing revenue. There will be......

Words: 1929 - Pages: 8

Free Essay

Social Issues Outline

...sections) of the research paper. Remember you are making a STATEMENT of the PROBLEM. Questions cause doubt in the readers mind. You are attempting to make a point. For example a start might be, “This research will investigate A; B; C; D. Be specific about exactly what this research will do and how (questionnaire) it will be accomplished. Discuss briefly what methods of investigation and analysis you will use. A common problem with this section is it gets too long. It should be concise and directly to the point. DO NOT WRITE IN THE FIRST PERSON. ELIMINATE THE WORD “I”, “we”, “they”, “our(‘s)”, or “their(‘s)” . B. LITERATURE REVIEW Write at least 500 to 1,000 words discussing information that has been previously written on the issue. This is the Library Research (historical) component of your research paper. You should try to include as much as you can which directly relates to your research paper. This section should compare and contrast different authors, opinions, and concepts. The Literature Review is NOT a series of book reports. This section is a mini standard research paper/essay. C. HYPOTHESIS This hypothesis is based on the literature you have read, your questionnaire, and your sociological intuition/imagination. (250 – 350 words) It will contain the expected answers to the questions you have developed in your questionnaire. 1. Be specific and try to guess the percentages (% of answers to your questions) of how people will respond to......

Words: 4187 - Pages: 17

Premium Essay

Currrent Issue of Financial Accounting

...gain the competitive advantage over competitors, leading to their acquisition (Hughes 16). With the increase of business acquisitions, there was a need to reexamine old accounting principles in order for the transactions to be properly recorded; this accounting is known as goodwill accounting. The concept of goodwill accounting has surprisingly been present for over a hundred years, first appearing around the 1880’s (1). Since its creation however, goodwill accounting has been a source of debate and controversy due to its adverse effects on the net income of numerous firms. Goodwill accounting has undergone recent revision by the FASB, specifically in the area of goodwill impairment. The purpose of this paper is to examine the history of goodwill accounting, the initial amortization method and revised current method of testing for impairment, and the needed, yet sometimes detrimental effects this accounting has had on several high-tech industrial firms. Without proper accounting for goodwill impairment, several firms would have the ability to overstate their net earnings and destroy the reliability of the financial statements in the eyes of investors. To understand the history and need for goodwill accounting and impairment, one must start with a definition of the concept. According to the Intermediate Accounting text by Stice, “goodwill is best thought of as a residual amount, the amount of the purchase prices of a business that is left over after all other tangible and......

Words: 1902 - Pages: 8

Premium Essay

Issues in Accounting Ethics

...Issues in Accounting Ethics ETH 557: Accounting Ethics September 14, 2015 Ethical Issues for Companies As an accountant and being in the public or the private sector you have to remain loyal to your clients and to be loyal to the ethical guidelines and rules when it comes to a company or and individual person financial records for the purpose of reporting. Being an accountant you will run across some unethical issues and this would be regardless of the type of industry and their goal would be to reduce any and all factors that they would face when it comes to manipulating financial records and this could lead to an ethical issue or criminal violations. The Sears Auto Center Scandal As stated in the textbook (Duska, 2011) “Those who appeal to consequences over fairness and rights are called consequentialist. Finally, the theory that gives precedence to the issues of fairness, rights, and commitment, and advocates doing the right thing – no matter what the consequences to self and others – is called deontological theory. Under this theory, the end does not justify means.” (Duska, 2011; pg. 52 & 62) Identify the ethical issues involved in the case from a consequentialist and deontological perspective (refer to Chapter 2). Ethics will always be a key factor when it comes to deciding what society would deem as being acceptable in order to live out one’s life. This factor would develop as a person and would include the morale as a whole......

Words: 1377 - Pages: 6

Premium Essay

Accounting Issues

...Jenna McMorrow Accounting 249 Linda Amman Ethical Paper 4/09/2015 Fraud An Oak Brook Chicago attorney, Kathleen Niew age 59, was once known as a successful real estate attorney and a popular radio host. Now known as crooked and corrupt behind the scenes. She used her law license to lie and steal from clients. Kathleen Niew used to host call-in radio shows on WIND-AM 560, and she offered estate and financial planning advice. Mrs. Niew also wrote multiple books about financial advice and lead countless seminars regarding how people can improve their finances. Kathleen Niew was offering advice to society, however behind the scenes she was bilking more than $2.3 million dollars from a Chicago couple who entrusted Kathleen with their life savings. Instead of investing and getting real estate deals for the married couple like they had asked, Kathleen diverted the money into her own investors. Unfortunately these clients of Kathleen’s are not alone, she has robbed multiple clients that came to her for help regarding their finances. She wired millions of dollars to a gold mining company in Australia, hoping to get a commission for herself in the deal. Kathleen had used the couple’s money for her own desires instead of theirs. Mrs. Niew pleaded guilty to 10 counts of wire fraud in 2014. Which resulted in her getting 70 months in prison, has been ordered to pay restitution of $2.34 million to all the victims of her fraud, and has to forfeit assets related to the crimes. She......

Words: 836 - Pages: 4

Premium Essay

Case Issues - Accounting

...Common Error Sheet • IFRS/ASPE are the new accounting standard and must be used when discussing all accounting issues. Although the case mentioned GAAP, you learned in class that IFRS was to be used. Going forward, discuss the case using IFRS/ASPE, even if the case says GAAP. • A lot of students missed mentioning that an unqualified audit opinion was needed; this was a constraint in the case. • The required in this case was to “provide advice about terms that should be included in the sale agreement to minimize the risks to Mr. Jones of being affected by accounting choices made by the new owner of the company”. Therefore, you are to write the case from the perspective that the new owner would make accounting choices that would not be fair to Mr. Jones, and to conclude on what is FAIR. • When discussing users and objective, make sure that you conclude on the primary user and objective. Also, make sure you are discussing users based on what is asked of you in the case. This case asked for advice on terms to be included in the sale agreement to minimize the risks to Mr. Jones; therefore, Mr. Jones is the primary user. Since Angela requested this case, she is also the main user. The buyer, CRA, auditor, etc. are not relevant users for this advice. • When discussing the new equipment purchase, a lot of students did not discuss the amortization policy that is to be used. This is an important issue within capital assets and it is especially......

Words: 464 - Pages: 2

Tokyo Ghoul √A | Classification of Authority | The Terror