Tuesday, May 5, 2020
Contemporary Issues and Conceptual Framework Sample for Students
Question: Does the Current Accounting Framework meet the needs of the users of Financial Reports as prescribed in the Objective of the Conceptual Framework of Accounting? Answer: Introduction The definition of the conceptual structure is being explained by the financial reporting that consists of the aims and the purposes related to the financial reporting. The financial reporting structure can be easily indicated by the help of the goals that includes the assumptions by the underlying development of the characteristics, and the definition can be appropriately constructed by expressing the explanations regarding the enhancement of the reports. The construction and the measurement of the financial elements are appropriately considered for the purpose of illustrating the various forms that depict the development of the forms and the contents for the purpose of reviewing the process of the financial reports (Beechy and Conrod, 2008). These characteristics are dependent on the development of the conceptual framework which is included in the project and the decision for the purpose of framing the financial framework easily shows the structure for the appropriate representation of the empowerment of the investors. The construction of the board seems to be envying the frameworks which enable the establishment of the corporation rules and the regulations, and it enables the establishment of the drives for the purpose of achieving the success (Spiceland, 2010). Therefore, the formulation of the appropriate needs can be easily framed by enabling the adoption of the framework and thereby the progress can be easily made by enhancing the views for the research. Main Context Analysis of conceptual framework As per the explanation of the conceptual framework, the Woolworths Limited is seen to be constituting of the standards that are being established by the IASB and the AASB. The frameworks enable the growth of the structure of the Woolworths Limited and also the characteristics can be easily defined by the proper establishment of the structure (Berk and DeMarzo, 2017). The operations regarding the work can be easily segregated by forming the appropriate establishment, and the structural framework can be easily obtained by indicating the success for the work. Therefore, the operations are properly carried out by the showing the implementation of the framework rules and the regulations that are related to the work. As per the conceptual framework of the Wesfarmers Limited are properly established by providing the development of the application for the future periods. The operations regarding the development of the market and the structure can be carried out by taking crucial decisions for the enhancement of the work, and the illustrations can be easily shown by describing the development of the structure. The formation of the appropriate structure is illustrated to be creating a user-friendly environment so that it becomes easier for the purpose of purchasing the underlying assets (Annual Report, 2017). The development requirements can be indicated to be in the form of the appropriate operation which is being carried out by the formation of the structure. The clarity can be signified by the constructing the functions, and the services which enable the storing operations in an appropriate way and therefore the liabilities can be easily removed that enables the operations to be carried out in a p roper way. The liabilities can be easily removed from the functions that enable the storage of the operations, and the construction can be easily developed by revising the standards (Brealey, Myers and Marcus, 2017). The figures can be easily constructed for the betterment of the assessment of the framework, and the enhancement of the views can be appropriately constructed by the framework as illustrated in the case of the Wesfarmers limited. The construction of the framework can be easy can be shown by illustrating the framework of the Wesfarmers limited. The figuring of the structure enables the establishment of the appropriate framework which is being extracted by the establishment by the progress which is being provided by showing the appropriate establishment of the construction regarding the framework. Governance of corporation The corporate governance of the Wesfarmers is appropriately explained by the help of depicting the curator type, and the companies board is enabled for determining the directions with showing the establishment of the progress of the operations. The structure is depicted to be dependent by constructing the framework of the processes, and the progress can be done by showing the enhancement of the work (Britton and Waterston, 2013). The delegation of the job and the set of the subjects are responsible for showing the enhancement of the structure of the processes. The structure shows the formation of the work that ensures the establishment of the structure and enabling the enhancement of the context that is undertaken by this case study. The structure seems to be depicting the framework of the system. The framework seems to be protecting the views which can be easily enhanced for the betterment of the work. The framework clearly shows the context that must be enhanced for the betterment of the processes and this enables the growth of the corporate governance (Weil, 2017). The corporate governance framework of the Woolworths Holding Limited shows the strategic deliberations that show the appropriate structure and operations of the Woolworths Holdings Limited. The strategic directions are appropriately structured for the development of the processes and the implementing the objectives in an appropriate way (Annual Report, 2017). The enhancement of the structures enables the enhancement of the objective for the development of the processes. The framework is being structured by showing the framework for the purpose of following the standards. Therefore, the Australian standards are illustrated by enabling the enhancement of the processes and the structure clearly describes the framework of the acts that are constructed for the betterment of the systems (Rahman, 2015). Therefore, it indicates the appropriate management of the social responsibility by following the rules and the regulations. The code of conduct is also followed of the companies which is imp ortant for the development. The development of an organization depends on the team members and management team within the organization. The rules and regulations need to be followed by the organization. Analysis on compliance with the AASB standards and conceptual framework The analysis of the financial report of the Woolworths shows that the consolidated financial reports have been prepared in accordance with the requirement of Corporations Act 2001, Australian Accounting Standards and International Financial Reporting Standards. Thus, the financial statements are being prepared as per the accounting standards and conceptual frameworks. All the accounting standards and interpretations that are issued by the Australian Accounting Standards Board is being adopted by the companies (Christensen, Cottrell and Budd, 2016). The company gets the direction from the AASB standards on the hedge accounting as it has replaced the existing requirements of the AASB139 financial instruments. Thus, the disclosure initiatives have also been applied by the company as per the standard. The information can be obtained by the investors from the annual report. The financial report analysis of Wesfarmers depicts that the financial statements in the annual report have prepared in accordance with the Corporations Act 2001, International Financial Reporting and Australian Accounting Standards Board. The conceptual framework has also been followed by the company that has enabled to prepare the financial statements. All the changed and new accounting standards and interpretations have been adopted by the company that is issued by the AASB (Eckbo, 2009). The financial statements disclose all the items as per the Australian Accounting Standards. The preparation of the financial statements of the company has been analyzed which shows that it has been prepared in accordance with the accounting standards. The accountants and the auditors follow the accounting standards that helps them to show the fair value of the financial statements (Welch, 2014). Conceptual framework revision The conceptual framework describes the main objective and importance of the financial statements. The conceptual framework is being followed by the organizations in order to prepare the financial report as per the accounting standards. The accounting standards are based on reliable concepts and methods. The accounting framework and policies are developed with the help of conceptual framework when the accounting standards cannot be applied to a particular transaction. The accounting standards can be understood and examined with the assistance of the conceptual framework (Holton, 2012). The annual report of Wesfarmers and Woolworths shows that both the organizations follow the conceptual frameworks to prepare the financial statements. The main objective of the conceptual framework is to improve the quality of the annual report by proving complete, updated and clear information. In the balance sheet, the liabilities and assets are adjusted appropriately in order to depict the fair value of the financial statements. The Australian Accounting Standards has been followed by the company to prepare the financial statements. The profitability, liquidity, and efficiency can be determined and examined from the annual report. The amended and new accounting rules and regulations have been followed by the company as per the accounting standards (Annual Report, 2017). The main aim of the companies is to depict fair value of the items in the financial statements. The management of the companies is responsible for managing all the operations and accounting rules and regulations. The profitability increases with the increase in the brand reputation of the company. Comparison of the annual reports The annual report of the organization provides important information to the users. The annual report discloses all the non-financial and financial transactions in their annual reports which provides significant information to the investors. The financial statements that are prepared by the companies are income statement, balance sheet, cash flow statement and statement of equity changes (KIESO, 2016). The investors will get all the information from the financial statements of the companies. The management team takes all the decisions on the basis of the information and able to get the actual value of the companies. The two companies are the leading retailers in the market and they have to present the financial reports fairly in front of the users. The income statement shows the expenses and income during a specific period of time. The balance sheet shows the assets, liabilities and statement of equity. The cash flow statements depict the inflow and outflow of cash during a specific p eriod of time. Both the companies have follows the accounting standards to prepare their financial statements that are shown in the annual report. The accounting transactions are also clearly stated in the annual reports of the companies. The companies generate returns for their shareholders and also present the accurate value of an organization. Conclusion The financial statements of the companies provide significant information about the value of the company in the market. The financial statements also provide significant information about the non-financial activities and financial activities of the organizations. The shareholders and investors get all the information from the financial report that helps them to take investment decisions. The IASB provides direction to the companies for preparing their financial statements and processes for reporting the financial events (Parrino, 2015). The rules and regulations are followed by the companies to depicts their annual report in front of the investors and stakeholders. The managers should manage all the operations appropriately. Recommendations The companies have to prepare their financial reports as per the accounting standards. The financial statements should provide the fair value of the items in the financial statements. The accountants and auditors are responsible for disclosing all the necessary financial items in the financial statements that help the investors to make effective decisions (Powers and Needles, 2012). The companies should also focus on increasing the quality of the products which is important for the development in the long run. The material misstatements affect the value of the annual report, and it is the responsibility of the accountants to determines and examine the errors and omissions in the financial accountants. The roles and responsibilities are divided among the members of the organizations. The employees have to carry out their tasks as per the guidelines. It is responsibility of the managers to guide their employees, accountants and auditors. References Annual Report, (2017). [online] Available at: https://wow2016ar.qreports.com.au/home/pdf/woolworths-annual-report-2016.pdf [Accessed 14 Apr. 2017]. Annual Report, (2017).Cite a Website - Cite This For Me. [online] Wesfarmers.com.au. Available at: https://www.wesfarmers.com.au/docs/default-source/reports/2016-annual-report.pdf?sfvrsn=4 [Accessed 14 Apr. 2017]. Beechy, T. and Conrod, J. (2008).Intermediate accounting. Toronto: McGraw-Hill Ryerson. Berk, J. and DeMarzo, P. (2017).Corporate finance. Harlow, England: Pearson. 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