Compare and contrast the objective of GPFRs in the current AASB Framework with that proposed in the IASB Exposure Draft. Do you think the IASB proposal is an improvement? Why, or why not? Do you think that the objective in either of these documents is app

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DEGREE : xxxxxxxxxxxxx

SUPERVISOR : xxxxxxxxxxxxxxxxx TITLE : Comparison and contrast the objective of GPFRs in the current AASB Framework with that proposed in the IASB Exposure Draft

STUDENT No

Accounting practices which are guided by the accounting standards that are set in every country vary from one country to the other . However there arise some regional accounting standards which provide accounting guideline for a group of countries . The rules that are contained in any accounting standard provide guidelines on how different types of transactions should be presented in

the accounting reporting . Some of the aspects that cause these variations include revenue recognition , and orientation of accounting principles to law among other related aspects that are likely to cause disparities across various accounting standards . For instant , the General Principles of Financial Reporting is an accounting standard that is adapted in Australia accounting practices . It provides the accounting guidelines that should be used by accounting practitioners in Australia

Following the different accounting standards which provide varied disclosure requirements , it poses a problem on comparability of information and also on using the financial reports for tax purposes This arises from the fact that different accounting standards are likely to report variedly even when using the same data . There has been an accelerated globalization and international trade , which implies that an international standard is advisable (Bragg 2007 ,

.8 . The aim of the International standard , which is in this case the International Accounting Standard Board , is to reconcile the various accounting standards adapted in various countries on promoting international trade and international financial accounting . The board is also responsible on evaluating the reliability of various accounting standards to the intended use

The objective of GPFR according the provision of its framework is to provide information about the financial status , the performance of the firm and also the cash flow of an entity (Godfrey and Chalmers 2007 br

.56 This information is expected to be useful to a wide range of users in the varied economic and business decision making requirements . In an attempt of improving the conceptual framework of GPFR , International Accounting Standards Board (IASB ) provided a recommendation over the objective of GPFR . IASB adapted the same objective as GPFR . In addition to this , IASB framework provided that the information that is contained in the financial reports should be comprehensive . It should be comprehensible in the sense that , the users of the information with a reasonable understanding of business and economic activities should be able to use it with reasonable diligence . It further requires that , the users of the information should have a reasonable business , economic and accounting activities knowledge

GPFR was perceived to have had a limitation of presenting the Off-Balance sheet financial transactions which required for an improvement as provided by IASB (Abeysekera , 2007 ,

.23 . IASB recommended for an improvement in the disclosure of information because the users of the information found it difficult in understanding the content of the financial reports . The failure of the users of the information to...