Midterm review
1. Main sources of regulation of financial reporting 1. Government Regulation (true and fair; corporation act 2001) 2. ASX Listing Rules (firms on exchange) 3. Accounting standards (prepared by AASB)
2. International convergence: develop new or revise International harmonization: Australia accounting standards apply the international standard-setting bodies

Adoption by Australia of international accounting standards by 1 January 2005

3. Aust standards are set for all reporting entities, but IFRS are primarily designed for large corporations

4. Objective of financial reporting
Provide information to users that is useful for making and evaluating decisions about the allocation of scarce resources

5. Measurement of comprehensive income
Income
Less: Expenses
= Profit or loss for the period
+/- Items of other comprehensive income
=Total comprehensive income for the period

6. Other comprehensive income
Changes in asset revaluation surplus, actuarial gains and losses on defined benefit superannuation plans, gains and losses arising from translating the financial statements of a foreign operation, gains and losses on remeasuring available-for-sale financial assets, effective portion of gains and losses on hedging instruments in a cash flow hedge

7. The face of the statement of comprehensive income must include amounts for:
-Revenue
-Finance costs
-Equity accounted share of profit or loss of associates [covered in ACCT6010]
-Tax expense
-Profit or loss on discontinued operations
-Profit or loss for the period
-Each component of other comprehensive income, classified by nature
-Total comprehensive income

8. Recognition of asset:
“Assets" are future economic benefits controlled by the entity as a result of past transactions or other past events.
An asset should be recognised in the statement of financial position when and only when:
1)