Accounting Policies And The Decision Usefulness Of The...

Abstract The paper starts with the explanation of public interest, which means to act for the interest of the public. Public interest helps managers; regulators make ethical decisions for the society. The essay then goes on to talk about the accounting policies and the decision usefulness of those accounting policies. Examples of accounting policies are the balance sheet, income statement and cash flows statement. These give investor essential ideas of how profitability and how strong its financial position is; Corporate Governance and Auditing build up the confidence of stakeholders in the firm. Lastly, it talks about the amendments to the Australian Conceptual framework reduced the number of users in financial reports. The amendment to the framework results in the creation of more decision useful information for all the users of financial statements. Intro The notion of public interest refers to the interest of the society as a whole; when it comes to decisions making, decision makers should act for the best interest of the public but not for themselves. Public interest is an ethical term, it is very critical to know its importance and consider it when making decisions. As there are so many accounting policies in a financial report, investors can take advantage of those accounting policies for their decision usefulness because those accounting policies are there to protect the stakeholders. The paper then talks about the amendments to the Conceptual Framework as it reducedShow MoreRelatedShould the Fasb Consider Economic Consequences in Standard Setting1542 Words   |  7 PagesEstablishing Accounting Standards, â€Å"The process of setting accounting standards can be described as democratic because like all rule-making bodies the board’s right to make rules depends ultimately on the consent of the ruled†. One of the adv antages of the process is that external parties are invited to comment on exposure drafts or present testimony during roundtable discussions. The history behind SFAS No. 123 provides us with a prime example of external parties influencing Board decision in orderRead MoreChanges Of Fasb Accounting Standards Essay877 Words   |  4 PagesChanges in FASB Accounting Standards In 1973 the Financial Accounting Standards Board (FASB) was established to set the financial accounting standards in the United States of America for nongovernmental entities. These standards are collectively called U.S. Generally accepted Accounting Principles, or U.S. GAAP. The Securities and Exchange Commission (SEC) and the American Institute of Certified Public Accountants acknowledge the authority of these standards (FASB, n.d). A â€Å"proven, independent dueRead MorePositive vs Normative Accounting Theory Essay1032 Words   |  5 PagesEssay Guideline (brief simple short essay - example only to assist with planning) TOPIC: Discuss positive accounting theory and contrast it with normative accounting theory. Provide examples where appropriate.       The purpose of this essay is to provide an overview of positive accounting theory (PAT) and highlight how this theory differs to normative accounting theory. Definitions and assumptions of both theories will be considered and examples of the theories will be provided. In additionRead MoreEarnings Management Essay1007 Words   |  5 Pagescreditors etc. Many users rely on the information from financial statements to make decisions. Therefore, financial statements should be relevant, provide faithful representation, comparability, verifiability, timeliness and understandability. However, there are different evidences of managers manipulating the earnings for various reasons. â€Å"Earnings management is the choice by a manager of accounting policies, or real actions, affecting earnings so as to achieve some specific reported earningsRead MoreThe Role Of Asset Management Policy And Procedures Guide Of The Mai Wel Group1278 Words   |  6 PagesChallenge Foundation of NSW to being incorporated as a Public Company Limited by Guarantee. Current services offered by the Mai-Wel group include supported employment, residential living, day activity programs, job skills training, respite services, communit y access programs, accommodation support programs and training services. (Maiwel.com.au, 2015) 1.1) BACKGROUND Recently there have been concerns about the effectiveness of the asset management policy and procedures guide of the Mai-Wel group. The overallRead MoreThe Conceptual Framework Of Financial Statements1248 Words   |  5 Pagesstated accounting is a science that is involved in the reading, monitoring and assessment of the financial affairs of a business at any time. In accounting procedures one cannot make a rational choice without some framework of principle (Macve, 1981). The Conceptual framework was introduced in 1989 by the International Accounting standard board also known as IASB. A conceptual framework comprises of a set of basic principles that give general support and can assist with detailed decisions by increasingRead MoreDecision Usefulness Approach2877 Words   |  12 Pages| Decision Usefulness Approach | Can the decision usefulness approach make financial reporting more useful? | | | | | Prepared by Jing Wang Abstract This paper explores the question whether the financial statements can be made more useful. This leads to an important concept in accounting-- the concept of decision usefulness. To properly understand this conceptRead MoreFinancial Statements And Evaluating A Corporation Essay1150 Words   |  5 Pagesfor providing information of the company and are prepared from the balances of the accounting records of the company at a given date. Classification and summary of accounting data are properly structured financial statements. These are Income Statement, Accounting Profit, Economic Profit, and Balance sheet. The main objectives of financial statements are to help managers of an organization to determine whether decisions about funding were most appropriate, and thus determine the future of investmentsRead MoreFinancial Accounting Corporate Report 19751563 Words   |  7 PagesINTRODUCTION In 1975 the Corporate Report was published, this was the outcome from the Accounting Standards Steering Committees wide ranging discussion paper and in part considered the usefulness of financial statements (Dunn, April 2002) discusses that to meet their basic objective financial statements must be useful; and the information relevant and reliable. Information will have relevance if it influences the decisions of the users. Relevance and reliability are primary characteristics relating toRead MoreWhat Is Meant by Saying That Accounting Information Should Be ‘Decision Useful?824 Words   |  4 Pagesof users in making economic decisions. What is meant by saying that accounting information should be ‘decision useful? As stated in the AASB Framework, financial statements play an utmost important role to a variety of users, which mainly consist of the investors, employees, lenders, suppliers and other trade creditors, customers, governments and their agencies, as well as the public, in making vital financial decisions. For accounting information to be ‘decision useful to this groups of people