Regulation, Financial Accounting Information…
Thursday, 23 July 2015
6:49 PM
• Regulating Companies and Financial Reports in Australia
1. Corporations Act
i) Australian companies must comply with the requirements of the Corporations Act
2001
ii) The Australian Securities and Investments Commission (ASIC), a body established by
the federal government , administers this law
2. Australian Accounting Standards
i) All entities required to prepare financial statements in accordance with the
Corporations Act must apply Australian accounting standards
ii) An accounting standard is a technical pronouncement that sets out the required
accounting for a particular types of transactions and events
iii) Reporting entities must prepare General Purpose Financial Reports (GPFR) using the
Australian accounting standards
iv) In 2002 the FRC announce AASB would adopt IASB standards for all financial
statements for years starting Jan 1 2005, into which the AASB inserts any AUS
paragraphs deemed necessary for the public and NFP sector
3. Australian Securities Exchange Listing Rules
• Bodies involved in Regulating Financial Reporting in Australia
1. Australian Accounting Standards Board (AASB)
--- develop a conceptual framework
--- make accounting standards for purposes of the Corporations Act
--- formulate accounting standards for other purposes (e.g. public sector)
---participate in the development of a single set of accounting standards for worldwide
use
--- promote the main objectives of developing accounting standards
2. Financial Reporting Council (FRC)
--- responsible for the broad oversight of the process for setting accounting standards
--- appoints members of AASB
Week 1 Lecture Note Page 1
--- appoints members of AASB
--- advice and feedback on the accounting standards
--- determine broad strategic direction of AASB
--- monitor development of international accounting standards
--- assess continued relevance and...