Regulatory Framework

Question 1

Name 2 needs for regulatory framework

Answer 1

• The users receive a minimum amount of info to help with meaningful decisions
• Information is less subjective to help users with investment decisions
• Increases user confidence in reporting process so better decision making
• Regulate company/director behaviour

Question 2

What are the 2 main approaches to accounting?

Answer 2

A principles-based or conceptual framework approach
GAAP – generally accepted accounting principles.

A rules-based approach
A list of detailed rules that must be followed.

Question 3

What does IFRS stand for?

Answer 3

International Financial Reporting Standards

Question 4

What is the IFRS Foundation?

Answer 4

The supervisory body for the IASB, responsible for governance issues and ensuring each body is properly funded.

Question 5

What’s the main objective of the IFRS foundation?

Answer 5

The main objective of the IFRS Foundation is to develop and promote high quality global accounting standards – that are understandable and enforceable.

Question 6

What’s IASB?

Answer 6

International Accounting Standards Board.

An independent standard setting body of the IFRS Foundation solely responsible for the development and publication of IFRSs.

Question 7

What’s the main goal of IASB?

Answer 7

The main intention of the IASB is to develop a single set of understandable and enforceable worldwide standards.

Question 8

Which accounting standards do IASB have?

Answer 8

IAS’s - older standards adopted by IASB
IFRS’s - new standards issued by IASB

Question 9

What’s the IFRS IC?

Answer 9

International Financial Reporting Standards Foundation Interpretations Committee.

Question 10

What’s the goal for the for IFRS IC?

Answer 10

Reviews accounting issues and provides rapid guidance on divergent interpretations of IFRSs.

The IFRSIC works closely with the national standards setters.

Question 11

What’s the IFRS AC?

Answer 11

International Financial Reporting Standards Foundation Advisory Council.

Formal advisory body to interested parties affected by the IASB’s work.

Question 12

What do the IFRS AC do?

Answer 12

The IFRSAC gives advice to the IASB.

Question 13

Name 3 of the examinable accounting standards for L5 FR&A

Answer 13

IAS 1 - Presentation of Financial Statements
IAS 2 - Inventories
IAS 7 - Statement of Cash Flows
IAS 16 - PPE
IAS 36 - Impairment of Assets
IAS 38 - Intangible Assets
IAS 40 - Investment Property
IFRS 5 - NCA Held for Sale and Discontinued Operations
IFRS 16 - Leases