Why Consistency of Accounting Standards Matters: A Contribution to the Rules‐Versus‐Principles Debate in Financial Reporting

Wüstemann, Jens; Wüstemann, Sonja

doi:10.1111/j.1467-6281.2010.00304.x

Cited by 50 publications

(35 citation statements)

References 51 publications

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“…Supported by some previous research by Sirantiani & Handayani , Sari & Witono, (2014), Setiawati & Permata Sari, (2014), Widyaningrum and Rahmawati (2010) as well as Sukirman et al (2011), they find that human resources has a positive effect on the reliability of local government financial reporting. In line with that stated by Oluwatoyin, (2014); Savino, McGuire, & White, (2012);Wüstemann & Wüstemann, (2010) that human resource skills will increase along with the demands of technical complexity of modern business. Based on the regulation which sets about State Civil Apparatus Law Number 5 Year 2014, the third hypothesis is proposed in this research.…”

Section: Introductionsupporting

confidence: 68%

The Effect of Accrual-GAS on the Financial Reporting Reliability With HR Capacity as Mediating Variables

Aryani

Kiswanto

2017

jda

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This research aimed to gets empirical evidence of the influence of human resource capacity with relation accrual-based government accounting standards on the relia-bility of financial reporting. This Research is a population research with the number of respondents 52 State Civil Apparatus who officiate as treasurer in each SKPD and employees in the accounting field in BPPKAD Kudus. Analysis method for hypothesis in this research used path analysis. The results of this research indicate that accrual basis government accounting standards and the capacity of human resources has a positive influence to the reliability of financial reporting, while accrual based government accounting standards have a positive effect on the capacity of human resource, but the capacity of human resources is not mediate the influence between accrual based government accounting standards to reliability of financial reporting. Conclusion of this study says that implementation of accrual based in Kudus District can support reliability of financial reporting and the capacity of State Civil Apparatus who officiate as treasurer in each SKPD and employees in the accounting field in BPPKAD Kudus also supports the created of financial reporting reliability.

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Section: Introductionsupporting

confidence: 68%

The Effect of Accrual-GAS on the Financial Reporting Reliability With HR Capacity as Mediating Variables

Aryani

Kiswanto

2017

jda

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“…If the International Accounting Standards Board aims to move to a more 'principles-based' approach to standard-setting, this increases the role of professional judgment and potentially provides greater scope for the 'management' of reported results (Wüstemann and Wüstemann 2010). Such management may be limited through the design of standards or through the issue of International Financial Reporting Standard Interpretations (IFRICs).…”

Section: Discussionmentioning

confidence: 99%

Discretion in accounting for pensions under IAS 19: using the ‘magic telescope’?

Billings

O’Brien

Woods

et al. 2016

Accounting and Business Research

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We use a panel data set of UK-listed companies over the period 2005 to 2009 to analyse the actuarial assumptions used to value pension plan liabilities under IAS 19. The valuation process requires companies to make assumptions about financial and demographic variables, notably discount rate, price inflation, salary inflation, and mortality/life expectancy of plan members/beneficiaries.We use regression analysis to analyse the relationships between these key assumptions (except mortality, where disclosures are limited) and companyspecific factors such as the pension plan funding position and duration of pension liabilities. We find evidence of selective 'management' of the three assumptions investigated, although the nature of this appears to differ from the findings of US authors. We conclude that IAS 19 does not prevent the use of managerial discretion, particularly by companies whose pension plan funding positions are weak, thereby reducing the representational faithfulness of the reported pension figures. We also highlight that the degree of discretion used reflects the extent to which IAS 19 defines how the assumptions are to be determined. We therefore suggest that companies should be encouraged to justify more explicitly their choice of assumptions.

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“…A clear, consistent and unambiguous world is not the reality which accountants encounter when they compile financial statements or reports governed by financial accounting standards (Bhimani, 2008;Schipper, 2003;Tweedie, 2007;Wüstemann & Wüstemann, 2010). The history, some of the mechanisms used to develop these standards as well as the concomitant interpretations of both US GAAP and IFRS standards, often resulted in vagueness, inconsistencies and ambiguities in the Conceptual Framework and financial accounting standards (FASB, 2009).…”

Section: Introductionmentioning

confidence: 99%

An analysis of fundamental concepts in the conceptual framework using ontology technologies

Gerber

Gerber²,

Merwe³

2014

SAJEMS

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The interpretation of financial data obtained from the accounting process for reporting purposes is regulated by financial accounting standards (FAS). The history and mechanisms used for the development of ʻThe Conceptual Framework for Financial Reporting' (the Conceptual Framework) as well as the financial accounting standards resulted in impressive volumes of material that guides modern financial reporting practices, but unfortunately, as is often the case with textual manuscripts, it contains descriptions that are vague, inconsistent or ambiguous. As part of the on-going initiatives to improve International Financial Reporting Standards (IFRS), the International Accounting Standards Board (IASB) promotes the development of principle-based IFRS, which aim to address the problems of vagueness, inconsistency and ambiguity.This paper reports on the findings of a design science research (DSR) project that, as artefact, developed a first version ontology-based formal language representing the definitions of asset, liability and equity (the fundamental elements of the statement of financial position as defined in the Conceptual Framework) through the application of knowledge representation (ontology) techniques as used within computing. We suggest that this artefact may assist with addressing vagueness, inconsistencies and ambiguities within the definitions of the Conceptual Framework. Based on our findings, we include suggestions for the further development of a formal language and approach to assist the formulation of the Conceptual Framework. The project focuses on the Conceptual Framework for Financial Reporting after the incorporation of Phase A in the convergence project between the Financial Accounting Standards Board (FASB) and IASB.

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Why Consistency of Accounting Standards Matters: A Contribution to the Rules‐Versus‐Principles Debate in Financial Reporting

Cited by 50 publications

References 51 publications

The Effect of Accrual-GAS on the Financial Reporting Reliability With HR Capacity as Mediating Variables

The Effect of Accrual-GAS on the Financial Reporting Reliability With HR Capacity as Mediating Variables

Discretion in accounting for pensions under IAS 19: using the ‘magic telescope’?

An analysis of fundamental concepts in the conceptual framework using ontology technologies

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