Contemporary Issues Flashcards
smaller clients are not likely to use IFRS, what are the likely to use instead
FRS (Ireland+UK accouting standards)
what is the UK/IRL equivalent of IASB
Financial Reporting Council (FRC)
Are IFRS and FRS very different?
No
example of public sector companies
government
universities
i.e. public money funding and stakeholders
what is the issue with public sector accounting
needs modernisation
call to follow accruals basis
currently using cash basis i.e. waiting on money to flow in and out rather than recognising money when earned and expenses when incurred
what is the negative of using the cash basis of accounting
does not enable planning as delays in information
what will be some challenges in modernisation of public sector accounting
education and training staff
tailoring standards to suit an Irish context
will require a roll out over many years
what do alternative performance measures do
cover a range of areas related to the performance of the company
e.g. financial APMs and non financial
what are APMs also known as
non GAAP measures
i.e. not covered in GAAP
why are APMs unlike GAAP
are not consistently calculated for every company because of lack of rules and standards so can be manipulated and are then hard to compar
how do companies often manipulate APMs
will only disclose what is improving (biased)
adjusted for inflation
what are some examples of financial APMs
adjusted earnings
debt ratio
return on capital employed
what are some examples of non financial APMs
regarding workforce
green house gas emissions
water and energy consumption
how can APM reporting be improved
clear standards and rules around how to measure APMs and which should be included
or more information required in financial reporting so that there is less need for APMs
what are the two sustainability reporting standards published
IFRS S1: General requirements for disclosure of sustainability related financial information
IFRS S2: Climate related disclosures
in effect from Jan 1 2024
