Identification, description and discussion of the key issues disclosed in the news article
Discuss about the Conceptual Framework In Financial Standard Setting.
This essay has been constructed in accordance to reviewing an accounting professional journal article with the help of which an idea can be obtained with respect to the news article that has been published. The assessment of the article assists in having an understanding of 22nd enforcement decisions report.
This particular essay is related to the article that has been published on 30th April 2018 and the article is based on the “22nd enforcement decisions report”. This article looks to consider the European securities and even the market authority and discloses the extracts that are supplementary in nature from several database of distinct decisions related to enforcements that are specifically undertaken by the European national enforcers. It is seen that this distinct group manages all the decisions related to the various standards of accounting that are inclusive of the “IAS 36, IFRS 5, IAS 29, IFRS 10 and IFRS 3”.
The essential concern on which the essay tries to cover has been the announcement of ESMA associated to several information that is available from several data sources that are private with respect to the decisions related to enforcements on the financial statements. There exists a problem related to the knowledge about the degree with respect to which it can fortify the management convergence and the current various issuers in relation to the ones who make use of the financial data that is precise to the financial data in the suitable application of the rules that have been explained under the “International Financial Reporting Standards”. Furthermore, the article that has been chosen addresses the disclosures of the decisions related to the enforcements that would address the respondents in the market about which the treatment of accounting related to the European enforcements and this may potentially consider the conformation with the IFRS accounting trend (Giner et al., 2016). The several kinds of standards of accounting especially in the purview along with the range and this have been the one that are allowed by IFRS. Therefore the key problem that can be regarded is inclusive of having an understanding of the explanation that is behind the distinct decisions that can course the path towards the effective use of the regulations and standards of IFRS that has been explained in EEA (Adhikari et al., 2014). The paper explains that the European enforcers of distinct financial report assessment and thereafter address the financial pronouncements. It is seen that the pronouncements are explained by several issuers with district securities that are generally traded on a market that is guarded and is situated in Europe and distinctly the ones that can arrange the financial reports in accordance to IFRS.
Evaluation and the deconstruction of the issues reported in the news article
In addition, the chosen article of the paper tries to assess the extent of the conformation in accordance to the IFRS standards of IFRS in relation to the requirements that have been applied for the purpose of reporting which is inclusive of the national objective. “ESMA” constructed a database that is secret for the distinctive decisions related to enforcements that is undertaken by the specific enforcers that has been undertaken by the specific European enforcers on the basis of the data in order to nurture the suitable incorporation of the standards of IFRS (Beck et al., 2017). This concerned article has even looked to address the disclosure of the distinct decisions specifically on the enforcements that are constructed in order to address the several partakers related to the market that considers the treatments of accounting (Olibe, 2016). The article even addresses the assessment of whether the various treatments of accounting can be regarded to being with the range that has been identified of the ones that is permitted by the IFRS standards. Furthermore, ESMA even takes into account the pronouncements of the specific decisions in accordance to the intention behind the same. Therefore, this element can be supportive in assisting towards the stable implementation of the IFRS standard specifically within the European Union (Markelevich et al., 2015).
There are several topics that have been discussed in the news article that has been selected and the standard that has been included in the article has been IFRS 5. This essentially on the non-current assets that are preserved for the purpose of sales as discounted activities comprising of the matter of the subject in accordance to the asset classification (Osei, 2017). It is seen that it is not anticipated to be promoted in the market with the distinct time frame of 1 year. In this manner, it is seen that the information can be added in this distinct piece of the explanation that has been considered (André et al., 2016). Distinctively, the general context, this allows the assessment of the assets or the batch that is disposal and is preserved essentially for sales are not depreciated. It is computed at a much smaller value of the distinctively the carrying value in accordance to the fair value by subtracting the cost that is associated to the market.
IAS 7 focuses on the cash flow statement and this has been observed in this article. This encompasses the explanation as well the disclosure of the limited cash balance. This article even is inclusive of the IAS 32 specifically on the financial tools and focuses on the presentation. This essay therefore addresses the everlasting notes that can be explained as the liabilities that are disclosed in this specific part (Schreiber, 2017). Furthermore, IAS 1 is even addressed in this article prioritizing the disclosure of the financial reports. Additionally, IAS 36 duplicating the asset impairment assists in explaining the declarations on the specific estimations that are related to the various competitive prices that have significant amount of risk that leads to the adjustments of the materials to distinct amounts related to carrying. IFRS 3 has been enclosed in the article on the “Business Combination”, IFRS 13 concentrates on the enumeration of the fair value and IAS 38 concentrates on the intangible assets that explain the price of the purchase intention of a distinct group of the various assets that have been accumulated (Fisher, & Nehmer 2016). In addition, it is seen that IFRS 17 explains the distribution of the various non-cash assets to the several owners addressing the demergers and the precise distribution of the particular segment to the issuer of the shareholder (Blatt et al., 2018). Furthermore, IAS 1 explains the disclosure of the financial announcements of the several losses of the revaluation of the several assets that is utilised in the operational activities. In addition, IAS 10 focuses on the financial statement consolidation. This specific section of the focuses in the development of authority over a specific issuer that is specific to the offer given to the tender.
Identification of a range of the applicable accounting theories
Positive theory of a specific rule and regulation addresses about the amendment, elimination and develop in accordance to the institutional incorporation of the directions that are distinct to the sector. The influence that is undertaken by the organizations with respect to the interests of the consumers along with the self interests of the authoritarian agency needs to be considered for addressing the regulatory attitude (Klann et al., 2015). There are several interest groups of the specifically consumers, manufacturers with respect to the related interest groups that may even fight with one another for the intention of gaining certain kind of political influence. This model can be related to the present article as this document with respect to enforcement that is inclusive of the several regulations that essentially forces the effect on the business organization that are functioning in several segments, consumer interests along with the regulators (Adeyemo et al., 2017).
It is even seen that the public theory can even be related to the present research on this article that has been explained. It is seen that this is a particular point of view that can be related to the perception of the associated wellbeing (De Luca, & Prather-Kinsey 2018). This explains the empirical authentication of the regulation. The theory even addresses the marker comprises of distinct characteristics, which may be ineffective and may even under go failure of the market that needs to be rectified with the use of the distinct rules.
It is seen that this theory has established a key supposition in relation to the characteristics of the various regulators, utilisation of the entire data and this manner can undertake specific suitable enforcement (Edwards Jr, 2016). This theory even associates with the enforcements of the plans that are vital for the development of welfare. Therefore, this article that has been explained can be understood by exploiting the theory of public interest and in accordance to the regulation of the positive theory.
Conclusion
The explanation that has been done on the article explains the enforcement decisions report that has been published by ESMA. In this manner, this theory has been assistive in assessing the decisions of enforcement related to a specific announcement with the purpose of developing the management convergence and explaining various issuers with precise data on suitable incorporation of the IFRS standards.
This report has been prepared in order to understand the development of the comments and the proposals that have been provided by the “Financial Accounting Standards Board” (FASB) and the draft has been associated with the “Proposed accounting standards and the updates in the income statement and the reporting of the comprehensive income”. These drafts have been offered for comments and there are several companies who have given their comments on the draft and have either agreed to have disagreed to the draft. Out of all the companies who have provided their comments, four participants have been selected and accordingly their views are assessed in order to have an understanding of whether the exposure draft can be put into implementation or not
The comment letters that have been provided by the companies have been provided in the appendix below and accordingly the proposal that has been constructed is associated to the distinct advises in accordance to the accounting standards and thereby creating a foundation of the updates on the income statement and the reporting of the comprehensive income.
The exposure draft that has been constructed with respect to the distinct regulation or standard associated with accounting, which looks to shed light on the updates that can be made in the income statement and accordingly the reports that can be made for the comprehensive income. This can be helpful in creating a better income statement and all the transactions within the income statement can be understood in an effective manner. The development is essential in order to mitigate the errors that are existent and the complexities that are related to the construction and the understanding of the income statement (Gordon et al., 2017). This would be helpful in creating a process that would provide effective construction of the income statement and accordingly create a better disclosure of the comprehensive income of the companies.
The report that has been constructed comprises of the four selected companies who have commented on the draft that has been published in the website of FASB. The report has been helpful in creating an idea about the critical assessment of the comments that are different and has been attained from the selected companies with the help of which an extensive solution can be attained with the method of assessing the standards of accounting. Therefore, this method can be assistive in answering the several problems (Gotti, 2016). Furthermore, the secondary objective of the report is to express the process of completing the principles of guiding related to accounting that would be helpful in the development of the accounting standards. In addition, the current paper looks to assess the different kinds of comments with respect to the approval and the disapproval of the companies in order to reach the outcome in accordance to the effectiveness of the accounting standards (Alon, & Dwyer 2016).
The report would even be helpful in explaining the fact accounting standard in relation to the updates of the income statement and the reporting of the comprehensive income would be helpful in addressing the safeguard and the protection of the emotions and the feelings of the companies due to which the effectiveness of the business can be maintained and along with a strong bonding among the different companies and their operations as well that would lead to a better overall business scenario. Therefore the improvement and the upgradation of this kind of processes that are related to the disclosure of accounting have been explained in an explicit manner. Walton, (2018) explained that accounting regulations and standards looks to address the particular knowledge and ideas and thereby essentially effective for the companies associated in different sectors in order to get engaged in the process of giving out the comments. The comments act as the feedback that is attained with respect to the distinct proposals and this has been an effective process with the help of which interests of the public can be enhanced (Perkins, 2016). In the same manner the questions that are pertinent related to the alterations that are disclosed in the frameworks of the Financial Accounting Standards Board are discussed through the comments. It is seen that the organizations have the liability of commenting on the distinct questions that are disclosed in the form and explains the agreements and the disagreements that have been provided by the respondents. It is seen that there are several questions that are explained and all the questions that are disclosed essentially requires to be answered in order to take care of the interests of the public.
It is explained in this report that the comments that have been gathered from the selected participants can be regarded in order to decipher the ideas and the knowledge about the agreements and the disagreements with respect to the alterations that are recommended in the accounting regulations and guidelines. In this manner, the comments that have been attained from the companies can be regarded in this outlook.
This is a renowned banking organization that looks to control and take care of the banking activities that are undertaken in United States of America. This association looks to address the concerns and the issues that are related to the banks in America and accordingly an effective framework can be maintained. In accordance to the draft that has been provided by the FASB related on this topic, it is seen that the association has appreciated the opportunity to provide a comment on the proposed standards of accounting and the present guidance of accounting and practice create a general value in the comprehensive income that have accumulated and the outcome that has been attained has been misleading to the investors and a burden on the administration (Whittington, 2015). The amendment in the structure will not be helpful for the banks where the stranded amount can have an impact on the extent of capital. Therefore, the company disagrees to this draft as they feel that these changes in the accounting standards can have an impact on the financial transactions and reporting of that are done by the organizations and the banks and this can have an impact on the operational activities as well. The association recommends that changes are made in the proposal as well.
This company associates with providing casualty and property insurance services and products to an extensive variety of the operations and the individuals as well. The company in their feedback has explained that they are supporting to the approach in order to address the concerns of the stakeholders with relation to the present guidance in GAAP that needs the deferred tax liabilities and assets (Aleksanyan, & Danbolt 2015). The company agrees with the changes that are proposed ASU that would need reclassification from the accumulated comprehensive income. In this manner, it is seen that all the proposals that have been addressed in the draft are supported by Travellers Companies Inc and therefore they feel that all the changes that have been suggested needs to be incorporated.
The company concentrates on manufacturing tires and various other rubber accessories to the consumers and thereby tries to maintain an effective market for themselves. With respect to the draft that has been disclosed by the FASB, it is seen that the company does not support the proposal where the reclassification and the transition requirements are explained as they feel that it would lead to a huger balance of the stranded taxes defeating the purpose of the amendment (Glover, & Werner 2015).
On the other hand, the company supports the backward tracing that is proposed in the draft as the company feels that this would eliminate the stranded tax impacts from the financial statement preparers.
The organization is one of the world’s leading energy companies that are associated to providing crude oil, natural gas and other products that would be useful in the development of the economy as a whole. The company has answered to all the questions that have been answered and accordingly it is seen that with respect to reclassification, it is seen that the company supports to this proposition and even supports that all the early adoption needs to be undertaken. The company even supports to the date that has been proposed (Baker, & Burlaud 2015). With respect to the reclassification proposal, it is seen that the company accepts the proposal but feels that impact on the tax changes of the foreign subsidiaries can lead to the impact on the stranded tax impacts.
The importance of the draft explains that the developments are significant for the amendments for the income statement and the reporting of the comprehensive income and thereby the improvements in the income statement can be introduced and better accounting results can be attained (Moldovan, 2014).
Conclusion
The results have indicated that the proposal that has been undertaken explains the fact that the draft needs certain amendments according to the recommendations that have been provided by the selected companies in order to make the proposal better and effective.
Reference List
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