...A critical review of the trade-offs between the concepts of relevance and reliability in financial reporting Theme: Financial Accounting Classification: M41 Author: Prof D Coetsee Affiliation: Department of Accountancy, University of Johannesburg, South Africa Contact address: Department of Accountancy R-Ring 607 University of Johannesburg PO Box 524 Auckland Park Johannesburg South-Africa 2006 Telephone: +27-11-559-3047 Fax: +27-11-559-2777 E-Mail dcoetsee@uj.ac.za A critical review of the trade-offs between the concepts of relevance and reliability in financial reporting |Abstract | |In an information orientated system of financial reporting the move from historical cost to fair value | |accounting has created numerous debates surrounding the trade-offs of the concepts of relevance and | |reliability. This article contributes to the debate by critically reviewing the current developments of | |these trade-offs to determine whether current financial reporting guidelines are appropriate to deal with | |the difficulties and uncertainties of financial reporting. The article found that the proposals of the joint| |framework discussion paper goes a long way in resolving the issues around the trade-offs of relevance and | |reliability. Changing the concept of reliability to faithful representation...
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...Argumentative Paper Peer Review Rubric. Please have a peer (friend, family member, coworker- your choice) read your paper and complete this rubric. To make using the rubric easier to submit to me please have your coworker read your paper, and highlight the appropriate level they believe you have achieved using the highlighting tool in your word processing software. In addition, please have them identify and copy and paste your thesis statement and the topic sentences for each paragraph. | |Exemplary |Proficient |Emerging |Not Yet Demonstrated | | |100% |86% |73% |60% | |INTRODUCTION / THESIS |Well-developed introduction |Introduction creates interest |Introduction adequately |Background details are a | | |engages the reader and creates |and contains background |explains the background of the|random collection of | |Background/History |interest. Contains detailed |information. Thesis clearly |problem, but may lack |information, are unclear, and | |Defining the Problem |background information and a |states a problem and the |clarity. Thesis states a |may be loosely related to the | |Thesis Statement...
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...Qualitative characteristics in accounting disclosures: a desirability trade-off Malcolm Smith Associate Professor of Accounting, School of Economics and Commerce, Murdoch University, Perth, Australia A number of studies in the USA, UK, Australia and Canada have addressed the evaluation of the usefulness of accounting information and sought to identify criteria for assessing the quality and utility of financial reports (e.g. Institute of Chartered Accountants in England and Wales (1975), Financial Accounting Standards Board (1980), Institute of Chartered Accountants in Scotland (1988), Accounting Standards Board (1991)). The qualitative characteristics viewed as desirable for the fulfilment of the fundamental objective of communicating decision-useful measurement recognize that all of these characteristics are not simultaneously achievable and that some trade-off is necessary. Examines the nature of this conflict of objectives and attempts to quantify the extent of the conflict for different user groups. Introduction Since the late 1960s research efforts regarding a conceptual framework have been commissioned in response to mounting public and professional pressure with regard to the nature of corporate reporting and deficiencies in the accounting standard setting process. Peasnell[1, p. 254] with respect to the Financial Accounting Standards Board (FASB) conceptual framework observes: “it perceives a need to show that its heart and mind are in the right place: to demonstrate...
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...Critical Thinking and Its Applications Many lessons are learned in life. Some lessons are instructions on how to be polite, how much of a tip should be given for different services, and how to be professional. Another lesson not often taught in the workplace or at home, are the hows and whys of critical thinking. Critical thinking is an important skill and can be described as the careful and deliberate determination to accept, reject, or suspend judgment about a claim. In this, critical thinking is the process of evaluating what people say and write in determining whether to believe their statements or not. This paper will provide a concise definition of critical thinking, and examples from personal experiences in the workplace (Cengage Learning, 2008). William Graham Sumner (1906) defined critical thinkers in the following way, they “cannot be stampeded… are slow to believe … can hold things as possible or probable in all degrees, without certainty and without pain … can wait for evidence and weigh evidence … can resist appeals to their dearest prejudices.” (Paul, R. and Elder L., 2006) In simpler terms, critical thinking is the mental processes of discernment, analysis and evaluation. It includes possible processes of reflecting upon a tangible or intangible item in order to form a solid judgment that reconciles scientific evidence with common sense (Wikipedia, 2008). Some characteristics of critical thinkers are: being intellectually humble; knowing what ones biases...
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...final submission. In Module 1, you reviewed the instructions for the capstone strategy audit assignment and grading rubric due in Module 5. By now, you have completed the following steps: • Identified the organization for your report • Interviewed at least one key mid-level or senior-level manager • Created a market position analysis • Conducted an external environmental scan in preparation of your final report and presentation In this assignment, you will generate a preliminary strategy audit in preparation for your final course project. Prepare a report that includes the following: • In preparation for your course project, prepare the preliminary strategy audit using the tools and framework you have focused on so far including the following: o Analysis of the company value proposition, market position, and competitive advantage o External environmental scan/five forces analysis • Identify the most important (5-7) strategic issues facing the organization or business unit. o You may modify the strategic issues in your final report based on the additional analysis you will conduct in the next module as well as the feedback you receive on this paper from your instructor. o Keep in mind that it is important to look at the strategic issue(s) from more than just one perspective in the business unit or company—speak to or research the issue from more than one angle to offer a 360-degree approach that does not cause more problems or issues. o Strategic...
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...Statement of Financial Accounting Concepts No. 8 September 2010 Conceptual Framework for Financial Reporting Chapter 1, The Objective of General Purpose Financial Reporting, and Chapter 3, Qualitative Characteristics of Useful Financial Information a replacement of FASB Concepts Statements No. 1 and No. 2 Copyright © 2010 by Financial Accounting Foundation. All rights reserved. Content copyrighted by Financial Accounting Foundation may not be reproduced, stored in a retrieval system, or transmitted, in any form or by any means, electronic, mechanical, photocopying, recording, or otherwise, without the prior written permission of the Financial Accounting Foundation. Statement of Financial Accounting Concepts No. 8 September 2010 Conceptual Framework for Financial Reporting Chapter 1, The Objective of General Purpose Financial Reporting, and Chapter 3, Qualitative Characteristics of Useful Financial Information a replacement of FASB Concepts Statements No. 1 and No. 2 Financial Accounting Standards Board of the Financial Accounting Foundation 401 MERRITT 7, PO BOX 5116, NORWALK, CONNECTICUT 06856-5116 Statements of Financial Accounting Concepts This Statement of Financial Accounting Concepts (Concepts Statement) is one of a series of publications in the Board’s Conceptual Framework for financial accounting and reporting. Since the publication of the last Concepts Statement, the Board has undertaken a project with the International Accounting Standards...
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...Statement of Financial Accounting Concepts No. 8 September 2010 Conceptual Framework for Financial Reporting Chapter 1, The Objective of General Purpose Financial Reporting, and Chapter 3, Qualitative Characteristics of Useful Financial Information a replacement of FASB Concepts Statements No. 1 and No. 2 Copyright © 2010 by Financial Accounting Foundation. All rights reserved. Content copyrighted by Financial Accounting Foundation may not be reproduced, stored in a retrieval system, or transmitted, in any form or by any means, electronic, mechanical, photocopying, recording, or otherwise, without the prior written permission of the Financial Accounting Foundation. Statement of Financial Accounting Concepts No. 8 September 2010 Conceptual Framework for Financial Reporting Chapter 1, The Objective of General Purpose Financial Reporting, and Chapter 3, Qualitative Characteristics of Useful Financial Information a replacement of FASB Concepts Statements No. 1 and No. 2 Financial Accounting Standards Board of the Financial Accounting Foundation 401 MERRITT 7, PO BOX 5116, NORWALK, CONNECTICUT 06856-5116 Statements of Financial Accounting Concepts This Statement of Financial Accounting Concepts (Concepts Statement) is one of a series of publications in the Board’s Conceptual Framework for financial accounting and reporting. Since the publication of the last Concepts Statement, the Board has undertaken a project with the International Accounting Standards...
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...Technology, Auckland, New Zealand Abstract This paper examines the development of positive accounting theory (PAT) and compares it with three standard accounts of science: Popper (1959), Kuhn (1996), and Lakatos (1970). PAT has been one of the most influential accounting research programs during the last four decades. One important reason which Watts & Zimmerman (1986) have used to popularize and legitimize their approach is that their view of accounting theory is the same as that used in science. Thus, it is important to examine how far accounting has been successful in imitating natural science and how the development of PAT compares with the three standard accounts of science. This paper shows that accounting could not emulate the success of natural science. Further, the methodological positions of PAT conform to none of the standard accounts of science. Rather, PAT contains elements of all three. Finally, this paper identifies some methodological gaps in PAT. Keywords: Positive Accounting Theory, Philosophy of Science, Methodological Controversies Acknowledgements I would like to thank two anonymous reviewers of the journal for their helpful comments. Earlier versions of this paper benefited from comments from Lee Parker of the University of South Australia, Keith Hooper of Auckland University of Technology, Divesh Sharma of Kennesaw State University, and Santi Narayan Ghosh of the University of Dhaka. Introduction This paper examines the development of positive accounting...
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...Exchange and Macroeconomic Content Thomson Reuters Three Times Square New York, NY 10036 Tel: 1-917-971-1082 June 17, 2015 To Whom It May Concern: In addition to my full time position at Thomson Reuters, I teach a course on Emerging Market Investment Strategies as an Adjunct Professor at the Columbia School of International Affairs. I had the pleasure of having Tian Tian as a student in my class last year and would be happy to provide a recommendation on her behalf for the Research Analyst position at the Peterson Institute for International Economics. Tian was one of the best students in my class and consistently did A level work on all assignments. The course required term papers on selected countries and her papers on Mongolia and Taiwan were professional caliber. Both papers required sourcing and analyzing macroeconomic and firm specific data. Her work was technically competent and the presentation provided a nice assessment of the economic prospects and investment opportunities available in these countries. Tian Tian also regularly contributed to the in-class discussions and consistently made well thought out and insightful comments. Tian Tian and I have remained in communication since she graduated and several times she has made me aware of articles that were of relevance to my class which I much appreciated. Again, I want to vouch for Tian Tian’s technical competency and also her ability to write and speak in a professional and fluent manner. Please...
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...second part of this paper sets out to assess the difficulty preparing a useful set of financial statements that exhibits the qualitative characteristics mentioned in the first part. Defining a financial report: A financial report is a written report which quantitatively describes the financial health of a company. Financial statements are usually compiled on a quarterly and annually basis . According to the Accounting Standards Board (1999), the objective of financial statement is to provide information on the reporting entity's financial position and performance that is useful to a wide range of users to assess the management and for decision making. Composition of a complete financial statement As per IAS 1 (international Accounting Standard), a complete set of financial statement comprises of: * A statement of financial position (balance sheet) * A statement of comprehensive income for the period (income statement) * A statement of cash flow * A statement of changes in equity * Notes comprising a summary of significant accounting policies and other explanatory information. * A statement of financial position (Balance sheet) as at the beginning of the earliest comparative period when an entity applies an accounting policy retrospectively or makes a retrospective restatement in items in financial statement or when it reclassifies in its financial statement. However, the primary financial statements comprises of statement of financial position, statement of comprehensive...
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...Title of Paper In order to obtain the greatest benefit from research, it is necessary to interpret results accurately. The development and application of critical thinking skills is paramount when reading and evaluating research articles, rather than to take the research as fact. The following paper is a critique of a qualitative research article published in 2007 by Journal of Critical Nursing, titled “The Effects of Different Maternal Positions on Non-Stress Test: An Experimental Study”. Title and Introduction The title “The Effects of Different Maternal Positions on Non-Stress Test: An Experimental Study” (Alus, Okumus, Mete, Guclu, 2007) accurately reflected the content of the article and research study. The abstract remained concise as well as provided more detail to the article. The objectives, background, study design, means of data collection and analysis, results; conclusion, and relevance to clinical practice were all mentioned in a brief paragraph. The importance of the study was clearly stated, obtaining erroneous results from non-stress tests, when, indeed, the fetus is healthy and well oxygenated. The authors further described the supine position showed the least fetal activity, increased maternal back pain as well as maternal shortness of breath. (Alus, Okumus, Mete, & Serkan, 2007). The introduction was informative and included additional information into the understanding of decreased fetal movement. Alcohol intake, smoking, certain medications...
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...Plutocrats: The Rise of the New Global Super-Rich and the Fall of Everyone Else provides many thought provoking issues such as its relevance to the lives of the average worker. However, it falls short of truly providing a way ahead for addressing the main issue, income inequality. In the view of the author of this paper, Freeland tries to incite pity of the plutocrats. Regardless, she does provide an extremely important lesson for everyone, which is the significance of education. Therefore, this paper focuses on the book’s relevance, how income inequality could impact the economic futures of the next generation, and areas on the book that the author of this paper disagrees and agrees with. Relevance The book can be seen as a doom and gloom examination of income inequality to those who are not part of the 1 percent, much less the .1 percent. On the hand, rather than focus on the income inequality between the plutocrats and everyone else, the book can be used as a wakeup call to the average person to take their personal finances seriously. While the middle-class in America is shrinking, the middle-class family income is still defined as “$42,000 to $126,000 annually in 2014 dollars for a household of three.” Additionally, according to a 2015 study, roughly 46 percent of...
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...poverty i. On paper, the sheer amount of capital expended on social programs since their inception is a testament to their success – we wouldn’t be spending if they weren’t working I. Once these programs are taken into account, the data show a significant decline in poverty, and a much larger decline in extreme poverty II. Explanation of relevance b. The battle for economic equality between the have and the have-nots has been fought ever since animals started having connections to possessions. c. Because of this, groups of people have always been fighting to level the playing field using either violent or peaceful means III. Thesis statement d. America’s war on domestic and international poverty has not only been successful but has exceeded expectations in how successful it would be. ii. Expanded thesis statement II. Capital expended III. Wide range of successful programs IV. Unsuccessful programs have been culled or overhauled V. Statistical decrease in poverty level as qualifications for “poverty” have remained consistent IV. Arguments: Each of your main arguments can either argue a point that supports your position, or argue against something you believe is wrong. e. iii. iv. f. v. vi. g. vii. viii. V. Conclusion: This section of your paper should summarize and...
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...Capstone Essay: For the capstone essay, you will write a position paper on an issue related to , for example. To write an informed position paper, you will need to use one or more of the course readings, and at least three sources that you research on your own. Your independent research will serve to expand and better inform your understanding of the issue and help you to formulate a clear position on it. All of these sources will provide you with the evidence you need to support your point of view. Pre-writing Stage: Step 1: Step 2: The discussions in class and course materials should help you to determine how and where to find articles for your research. You must find two articles that are specifically related to your topic, which help you to support your position. (You might not need to use both articles, but it is better to have extra information in case one of your sources ends up not being useful). Step 3: Carefully read and annotate your researched articles. Step 4: Submit annotated bibliographies for each article. Annotations should summarize points made in the article and analysis of the ideas. In addition, you need to identify how specific ideas can be useful to you for writing your research. What points are made that can help support your views? What specific quotes from the text might you choose to include in your essay and why (what do the quotes show and how could they fit within the context of your research)? All annotations are...
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...Content Chapter 3 Review of Related Literature and Studies 3.1 Review of Related Literature 3.1.1 Title of Related Literature 1 Discuss the relevance of the related literature 1 and make the conclusions and contradictions found in the literature clear in the report. Use the guidelines below in discussing review of related literature. 3.1.2 Title of Related Literature 2 Discuss the relevance of the related literature 2 and make the conclusions and contradictions found in the literature clear in the report. Use the guidelines below in discussing review of related literature. 3.1.3 Title of Related Literature 3 Discuss the relevance of the related literature 3 and make the conclusions and contradictions found in the literature clear in the report. Use the guidelines below in discussing review of related literature. 3.2 Review of Related Studies 3.2.1 Title of Related Study 1 Discuss the relevance of the related study 1 and make the conclusions and contradictions found in the study clear in the report. Use the guidelines below in discussing review of related study. 3.2.2 Title of Related Study 2 Discuss the relevance of the related study 2 and make the conclusions and contradictions found in the study clear in the report. Use the guidelines below in discussing review of related study. 3.2.3 Title of Related Study 3 Discuss the relevance of the related study 3 and make the conclusions and contradictions found in the study clear in the report. Use the guidelines below in discussing...
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