International Financial Accounting Standards Research Articles

Comparative Analysis of Ukrainian and European Accounting Standards

The relevance of the study is substantiated by the need to study the peculiarities of the implementation of accounting standards in Ukraine. This research is focused on the comparison of Ukrainian, American and European accounting standards in a number of key elements. The research aims to study problems, perspectives and factors that influence the implementation of international financial accounting standards, conduct analysis and make recommendations. The comparison method is the main method for investigating this problem, which allowed comparing National Accounting Standards, International Accounting Standards and the American system of accounting United States Generally Accepted Accounting Principles. The design of this research is observational and theoretical in structure, which is a prerequisite for detailed study of the theoretical grounds of international and Ukrainian accounting standards, their analysis and comparison. For the processing of information obtained through the method of comparison, the following methods of scientific knowledge were used: the method of analysis, method of synthesis, deduction and induction, the method of classification, as well as the method of analysis of scientific sources, studies, regulations and laws. The article presents the results of comparative analysis of Ukrainian, American and European accounting standards in a number of key elements with the aim of studying the problems, perspectives and factors that influence the implementation of International Financial Reporting Standards. The study includes recommendations for the direction of development and expansion of the National Accounting Standards. Materials of the article are of practical value for accountants, lecturers and students of the specialty “Accounting and Audit”, public servants Keywords: stocks evaluation, regulation of agricultural business transformation accounting, regulations, international accounting standards, accounting standards comparison

The modern correlation of RAS and IFRS systems of the public and non-public sectors

Currently, the process of reforming the Russian Accounting Standards (RAS) systems for organizations in both the state and nonstate sectors (or organizations in the budget and not budget spheres) is ongoing. At the same time, this process continues to be carried out taking into account the systems of International Financial Reporting and Accounting Standards for organizations of the public and non-public sectors (IFRS, IAS, IPSAS). Therefore, today it is relevant to determine the modern ratio of the RAS and International Standards systems of the state (public) sector, as well as the RAS and International Standards systems of the non-state (non-public) sector. In addition, a comparative analysis of the systems of domestic accounting standards of organizations in the state and non-state sectors makes it possible to identify possible future changes in these systems. Indeed, in general, the accounting methodology for these organizations (including healthcare organizations in these sectors) should be unified. As a result, any innovation in the accounting of one of the above sectors may indicate the feasibility and possibility of making similar adjustments to the accounting of another of these sectors. For similar reasons, it is relevant to determine the current relationship between public and non-public sector International Standards systems. A comparative analysis of all these systems (including for healthcare organizations of the above sectors) is carried out in this article. Grouping method, comparison, analogy method, analysis and synthesis, systematic approach, logical approach were used as research methods. As a result of the research, the article presents proposals for the further development of the RAS and International Standards systems of the state/public and non-state/non-public sectors (including for healthcare organizations).

The concept of the fair value of fixed assets in accounting practice

The concept of fair value used in international financial valuation and accounting standards is now also widely used in domestic accounting practice. The object of the study is the federal accounting system. The subject of the study is fair value as a theoretical category of valuation of fixed assets within the framework of domestic accounting and valuation practice. The purpose of the study is to reveal the concept of fair value as a subject–conceptual category of accounting. Research objectives: 1. Theoretical and heuristic analysis of international and domestic standards; 2. Theoretical analysis of distinctive and characteristic features of fair value as a subject-conceptual category of accounting; 3. Formulation of objective and scientifically based research results. The research methodology is a subject-conceptual approach formed by general scientific accounting methods. The results of the study are presented in a summary tabular form, which identifies the types of transactions, the subject attribution of fair value depending on the type of transactions and the legal source (standard).

A review of accounting developments in Africa

Entities in the developing nations of Africa, just like other entities in the developed world need to demonstrate good stewardship in order to attract and retain investment. This means that African countries need a robust accounting infrastructure to deliver reliable and comparable financial information. This paper reviews the current status of accounting in Africa, by looking at the structure of the accounting profession, oversight of accounting entities, currency and monetary control, the status of adoption of International Financial Accounting Standards, the level of accounting research in Africa, and developments in accounting pedagogy at African institutions of higher education. This overview is intended to provide a baseline from which future researchers can develop further investigations into the accounting profession across the continent or a region of Africa.

Accounting for leases – lessons from COVID-19

Purpose The International Accounting Standards Board (IASB) and Financial Accounting Standards Board (FASB) have given relief to lessees in response to the coronavirus (COVID-19) pandemic. However, it is not clear why any relief from the requirements in International Financial Reporting Standards (IFRS) or the Accounting Standards Codification (ASC) should be necessary. The purpose of this paper is to highlight weaknesses in how the IASB and FASB developed their leases Standards, and why those Standards are not robust enough to cope with a shock to the economic system. Design/methodology/approach The COVID-19 relief suspends some features of the leasing requirements rather than changing them. What if other economic or regulatory events cause the same circumstances to arise? Findings Have COVID-19 exposed weaknesses in the leasing standards that should have been avoided when they were developed or is COVID-19 the problem? Originality/value Analysis of actual board discussions and staff papers is unusual and provides insights into the standard-setting process.

Islamic (Partner) Accounting and its Comparison with International Financial Accounting Standards (IFRS)

Accounting information systems are evolving along with modern information technology, which opens up countless opportunities to expand the intellectual, scientific and professional potential, contributing to the culture and

Impairment or amortization of goodwill? An analysis of CFO perceptions of goodwill accounting

Given the ongoing controversy around the accounting treatment of goodwill and the search by the International Accounting Standards Board (IASB) and Financial Accounting Standards Board (FASB) for improvements to goodwill accounting, this study surveys a global sample of 352 chief financial officers (CFOs) to understand their perceptions of adopting a goodwill impairment-only approach compared to an amortization model. More than half of the respondents agree that alternative accounting treatments of impairment testing might provide more useful information. However, almost two thirds still prefer goodwill impairment testing to the amortization process. Theoretically, the study shows that the impairment-only model preference is associated with characteristics on an individual, firm and country level. The results indicate that more expert CFOs and overall CFO perceptions of firms’ economic conditions and the role of external auditors affect preference for the goodwill accounting model. Further, there is evidence that dominant ownership structures and accounting culture affect CFO preferences. The study investigates several areas in which regulators and standard setters can intervene, thereby contributing to the debate on whether to reintroduce the amortization of goodwill.

Credit risk assessment: a comparison of the performances of the linear discriminant analysis and the logistic regression

The prediction of credit risk and borrowers solvency has been widely discussed in the financial and accounting literature whatever the international financial accounting standards (Levy et al., 2016). Various methods are used to build prediction models and can be adapted according to the country, the sector of activity and the nature of the data used. These methods have shown their effectiveness compared to traditional financial analysis for companies classification. This paper aims to compare the classification performances of the logistic regression (LR) model with those of the linear discriminant analysis (LDA) one on a SMEs sample belonging to the Algerian private sector.

International financial accounting standards in Uzbekistan

The organization of financial accounting and reporting through the principles of IFRS, which is not carried out within the framework of special government programs, is not supported by the state, will not allow to solve the main tasks of the transition in the coming years.

Banks’ Discretion Over the Debt Valuation Adjustment for Own Credit Risk

During our 2007 to 2015 sample period, firms recorded unrealized gains and losses on fair-valued liabilities attributable to changes in the firms’ own credit risk, referred to as the debt valuation adjustment (DVA), in earnings. Various parties criticized the inclusion of DVA in earnings as counterintuitive and manipulable. Using a small but comprehensive sample of European banks reporting nonzero DVA during this period, we decompose banks’ DVA into a normal portion explained by economic factors (e.g., changes in bond yield spreads) and an abnormal portion (the residual). Controlling for abnormal loan loss provisions (LLP) and realized securities gains and losses (RGL), we find that banks’ abnormal DVA is negatively associated with their premanaged earnings, consistent with banks exercising discretion over DVA to smooth earnings. We further find that banks that record larger LLP or RGL or that have histories of using LLP or RGL to smooth earnings are less likely to exercise discretion over DVA. These findings obtain in the financial crisis but not afterward. Collectively, our findings suggest that banks exercised discretion over DVA substitutably with discretion over LLP and RGL during the crisis. With the caveat that our analysis is limited by a small sample and the inherent difficulties of DVA decomposition, our findings have implications for how bank regulators and investors should interpret banks’ reported DVA, particularly in stress periods such as the crisis, and they provide support for the International Accounting Standards Board and Financial Accounting Standards Board’s (FASB) decisions to require firms to record DVA in other comprehensive income starting in 2018.

Credit risk assessment: a comparison of the performances of the linear discriminant analysis and the logistic regression

The prediction of credit risk and borrowers solvency has been widely discussed in the financial and accounting literature whatever the international financial accounting standards (Levy et al., 2016). Various methods are used to build prediction models and can be adapted according to the country, the sector of activity and the nature of the data used. These methods have shown their effectiveness compared to traditional financial analysis for companies classification. This paper aims to compare the classification performances of the logistic regression (LR) model with those of the linear discriminant analysis (LDA) one on a SMEs sample belonging to the Algerian private sector.

THE APPLICATION OF IAS 2 INVENTORIES STANDARD IN ACCOUNTING PRACTICES

In this study, IAS 2 Inventories standard is examined and the real-world accounting applications related to inventories are presented.IAS 2 Inventories is an accounting standard, which is part of the International Financial Accounting Standards (IFRS). It is the framework for the accounting treatment of inventories. Inventory makes up substantial part of the total asset value. Therefore, value determination and presentation of inventories is a fundamental part of accounting.The contribution of this work is highlighting the components which make up the value of inventories and the importance of choosing the inventory valuation method in managerial decision making. Moreover, accounts are suggested for journal entries to record inventory related costs.

BOBİ FRS İLE ORTAYA ÇIKMASI MUHTEMEL ETKİLERİN TEORİK BOYUTTA DEĞERLENDİRİLMESİ

BOBI FRS is a financial accounting set which is based on International Financial Accounting Standards (IFRS) developed by International Accounting Standard Board (IASB). Effective usage of BOBI FRS will contribute to the concept of mutual accounting reporting. Juridical regulations of countiries, economic structure and the place and importance of accounting profession in the country and other things cause the accounting standarts different from each other. These different accounting applications make the realtionships difficult for countries. After globilization, it is getting more and more necessary to have one type of standart set in accounting like all areas. However, only one universal accounting standart set will certainly contribute to development for commercial relationships. The study is aimed to display the challenges faced by the countries like Turkey in adopting International accounting standards like BOBI FRS. In addition to this, recommendations were given to eliminate the challanges ahead of effective usage of BOBI FRS. It was also explained what affirmative effects are expected with effective usage of BOBI FRS.

Mergers and Acquisitions from an Accounting Approach: A Review of the Empirical Literature

The European Committee support that the Financial Statements drawn up in accordance with IFRS as issued by the International Accounting Standards Board (IASB) provide users of these statements with a sufficient level of information to enable them to make an informed assessment of the assets and liabilities, financial position, profit and losses and prospects of an issuer. The International Financial Accounting Standards (IFRS) are a sound basis on which to unify accounting standards across the world. In its deliberations on and in elaborating positions to be taken on documents and papers issued by the IASB in the process of developing international accounting standards (IFRS and SIC), the Commission should take into account the importance of avoiding competitive disadvantages for European companies operating in the global marketplace, and, to the maximum possible extent, the views expressed by the delegations in the Accounting Regulatory Committee.This paper attempts to present the accounting methods applied with literature and examples when a merger or an acquisition takes place. This work is mainly directed at students and scientist of accountant and finance. Professionals also will get benefit from this paper because they will learn how to apply and understand the IFRS 3, so as to be able to fill in and analyze financial statements with IFRS. At the beginning we talk about IFRS 3 which is relevant to the accounting methods in mergers and acquisitions that occurred in every European country between big firms. We also show what happened when a big firm wants to takeover a small firm. Afterwards we analyze the steps that are needed to take when a firm wants to takeover a bank or an enterprise. Then we describe the Goodwill that is given from the bidder to the target firm if there is any. But which is the fair value of a takeover. If the bidder wants to allocate the cost should use the notes that we describe to determine it. Keywords: Finance, Accounting, Mergers and Acquisitions Jel Classification: M41, G34 DOI : 10.7176/RJFA/10-16-01 Publication date : August 31 st 2019

Implementation of accounting in the system of integrated business structures

The object of research is the European integration of Ukrainian accounting. One of the most problematic places is the insufficient compliance of Ukrainian accounting with international standards, which prevents Ukraine from integrating into the global financial space. Empirical research methods (observation, comparison, generalization), theoretical research methods and the analytical method are used. The paper discusses in detail the differences between the Provision (standard) of accounting of Ukraine and the International standards of financial reporting and accounting of other states. These differences create significant obstacles to doing business and prevent the implementation of accounting in the system of integrated business structures. The necessity of bringing state accounting and the basic principles of its construction with international standards is substantiated. This is necessary for the correct implementation of business integration structures in the system in order to ensure its effective functioning and obtain significant competitive advantages in the modern market environment. Changes in accounting should entail changes in tax and civil law, since the transition of Ukrainian accounting to international standards will become an important link in the integration of the Ukrainian economy into European and world economy. To justify the need to bring state accounting and the basic principles of its construction with international standards, the author proposed the following steps to solve this problem: – bringing into compliance the Provision (standard) of accounting of Ukraine with the International standards of financial reporting and accounting of other states; – ensuring adequate interpretation and compliance with the provisions of the Provision (standard) of accounting in Ukraine; – obtaining an audit opinion on the compliance of financial statements with the requirements of International Financial Reporting and Accounting Standards of other states.

Income and expenditure accounting: areas of harmonization of international and national financial accounting standards

Comparative analysis of accounting, valuation, determination and classification of income and expenses by international and national accounting standards has been performed, and problems of improvement of accounting of income and expenses by national and international accounting standards are outlined. Based on the comparison of national standards and international standards, the main characteristics and features of the classification of income and expenditure are considered. The expediency of using International Accounting Standards in Ukraine is substantiated. The objective necessity of applying the practice of accounting according to International Accounting Standards and outlining the benefits of using such practice is stated, the correspondence of the International Accounting Standards and Accounting Regulations (Standards), regarding accounting of income and expenses taking into account national and international practices, international and national accounting standards is investigated income grouping by type of experience in the Accounting Standards (Standard) and International Standard accounting. A comparative analysis of disclosure of financial results by international standards and national standards has been carried out. The current practice of compiling and presenting the Financial Statements (Income Statement) in accordance with international and national standards is reviewed. The necessity for application of the international financial reporting standards for Ukrainian enterprises is substantiated. A comparative analysis international and national accounting standards of disclosure of financial results by international standards and national standards has been carried out. The economic essence and features of the financial statement in the process of adapting the financial statements to international standards are considered. The regulatory aspects of the statement of financial performance have been investigated, which is a pressing issue as a result of bringing the national accounting system into line with international accounting standards.

Consolidated financial reporting and the effect of mandatory IFRS adoption on the information content of earnings announcements: evidence from Korea

ABSTRACT We examine the effect of mandatory IFRS adoption on the information content of earnings announcement in Korea, and its main driving factors. We find an increase in earnings information content with IFRS adoption; however, this increase is only weakly associated with the IFRS reconciliation adjustment, as a proxy for accounting rule differences. In contrast, we observe a strong association between the availability of consolidated financial statements and the increase in information content. Collectively, our analysis contributes to understanding the source of the IFRS effect, by providing new evidence of the crucial role of disclosure policy changes in consolidated reporting. Abbreviation: International Financial Accounting Standards (IFRS).

‘Fair Value’ accounting as the normative Fisherian phase of accounting

ABSTRACT‘Fair value’ accounting has been described as a new ‘actuarial/forward-looking’ phase of accounting regulations and standards. In this study, we present the hypothesis that ‘fair value’ regulations and standards are aligned with Irving Fisher’s theoretical writings (written more than a century ago) about economic and accounting value, and market prices. Through content analysis, we reveal a literal correspondence of Fisher’s writings to key fair value norms from the International Accounting Standards Board (IASB) and Financial Accounting Standards Board (FASB), such as the usage of alleged forecasts of future cash flows and discount rates in explaining market values and prices. Aligning with shareholders/owners interests, Fisher’s theoretical framework can be found in contemporary fair value accounting norms.

Implementation of international financial accounting standards from the perspective of companies in the Czech Republic

Implementation of international financial accounting standards from the perspective of companies in the Czech Republic

The Positive Outlook Of The Last In First Out Inventory Methods

Until very recently, the Last In First Out method (LIFO) was under severe scrutiny from the financial community, and its repeal as an acceptable accounting method seemed imminent. There were pressures from the Securities and Exchange Commission and the International Financial Accounting Standards Board to standardize accounting standards worldwide. In addition, there were political pressures imposed by US Congress to raise additional revenues. Both groups strongly oppose LIFO. However, an SEC Report issued in July 2012 has greatly renewed the lifeline of LIFO indefinitely. In the unlikely case of its ultimate repeal, the author presents some tax opportunities available in this transition period.