regulatory framework 1

8/8/2019 Regulatory Framework 1

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Learning Outcomes

yWhy do we need to regulate?

yWhat regulation is there of accounting information?yWhat regulation is there of accountants?

y How should regulation be best achieved?


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Why do we need to regulate?


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Regulatory Framework of

Accounting Information

Law StockExchange

AccountingStandards


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Law StockExchange

AccountingStandards

Law

CompaniesAct 2006

Civil Law

ContractLaw

Regulatory Framework ofAccounting Information


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Law StockExchange

AccountingStandards

StockExchange

Listing

Rules

Listing

Rules

CorporateGovernance

CorporateGovernance



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Law StockExchange

AccountingStandards

AccountingStandards

UKAccounting

Standards

InternationalAccounting

Standards

GAAPConceptualFrameworks



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Process of issuing an accounting

standard

AdvisoryCommitteeformed by

IASB

DiscussionDocument

Exposure DraftIFRS or

amendment toIAS


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Accounting standards and choice?y Many accounting standards give choices on

accounting. Should they?

y The USA follows a prescriptive system where standardsare very detailed and they attempt to cover alleventualities

y The IASB is a principles based system which does notspecify all the details but seeks to obtain adherence tothe spirit of the regulations.


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What is the Conceptual

Framework?y A coherent system of interrelated objectives and

fundamentals that can lead to consistent standards

and that prescribes the nature, function and limits offinancial statements.


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What regulation is there of

accountants?

Ethical

Standards

e lat r( inancial

e rtinncil)

ec nisedS ervis ry

B dies


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accountants?

Ethical

Standards

e lat r( inancial

e rtinncil)

ec nisedS ervis ry

B dies

Ethical

Standards

I A c de

Pr fessi nalB dies

Em l yinOr anisati ns


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Ethical

Standards

e lat r( inancial

e rtinncil)

ec nisedS ervis ry

B dies


accountants?

e lat r( inancial

e rtinncil)

Pr fessi nalOversi ht

B ard

Acc ntancyand Act arial

Disci line

B ard


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accountants?

Ethical

Standards

e lat r( inancial

e rtinncil)

ec nisedS ervis ry

B dies

ec nisedS ervis ry

B dies

Q alificati n

PD

Ethics

Disci line


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Regulationy Imposed regulation is expensive accountants need to

prepare; analysts need to interpret

y Research suggests that markets respond to increasedvoluntary disclosure.


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TutorialWork

y Prepare bullet points for discussion on whether or notaccounting standards are necessary.

y Ensure you argue for and against the point

y No more than 12 bullet points in total

y Post to the assessment section of studynet within one

hour of the tutorialy Be prepared to present and argue your case in tutorials

next week

regulatory framework 1

Documents