...Governmental Accounting Standards Board (GASB) and Financial Accounting Standards Board (FASB) Analysis Paper Accountants or individuals, who put the financial statements together, need the knowledge of the two different accounting standards board. The Governmental Accounting Standards Board (GASB) and the Financial Accounting Standards Board (FASB) differ from each other and are similar in different ways and individuals need knowledge of the differences and similarities. GASB and FASB allow use of the modified accrual basis of accounting or the full accrual accounting for government and not-for-profit organizations. Knowing the differences between the two methods and the meaning are important. GASB and FASB Similarities GASB and FASB accounting are sets of objectives that proprietorship, government, and not-for-profit organizations follow in preparing financial statements. According to Weygandt (2008, p. 17) “both the GASB and the FASB have established objectives that circumscribe the functions of financial reports.” GASB and FASB objectives show whether a company is making enough profit to pay for expenses throughout the year, allows investors information to decide whether to invest or not, and how well the company budget complied throughout the year. Also, the two accounting standard boards show whether management is complying with all aspects of the objectives. GASB and FASB accounting have differences that individuals need knowledge about to prepare financial statements...
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...Groupon Inc. was forced to restate their revenue numbers on the financial statements before being able to offer an Initial Public Offer (IPO) in 2011. Groupon is a company that offers daily deals for local services of their customers. These deals can be bought one day and then used at a future date of the customer’s choosing. These offers are comprised of a set portion for the business owner and a markup commission value for Groupon. Previously Groupon would book the entire value of the sale as revenue and then back out the business owner’s portion of the sale and call the remainder as profit. The Securities and Exchange Commission (SEC) has refused this booking procedure and wants Groupon to state revenue as the total value of the sale minus the business owner’s portion of the sale. This brings up an interesting twist on how today’s service based economy can consider booking revenues opposed to a clearer manufactures revenue process. In a traditional manufacturing process it was reasonable to state the total sale numbers of the final products as revenue. I believe this process is acceptable under this traditional way because the timing between purchase of materials and sale of the finished product have different timing. This easily identifiable timing difference between sale and purchase of the product and its components drawls a clear line between the timing of booking revenue and expenses. The fact that the two bookings have different timing allows a company to...
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...Financial and Managerial accounting are used for making sound financial decisions about an organization. They provide information of past quantitative financial activities and are useful in making future economic decisions. (Albrecht, Stice, Stice, & Skousen, 2002) The same financial data is used to derive reports for each accounting process yet they differ in some ways. Financial accounting primarily provides external reports for external users such as stock holders, creditors, regulating authority and others. (Garrison, Noreen, & Brewer, 2010) On the other hand Managerial accounting is concern with providing information that deals with the internal viability of the organization and is tailored to meet the needs of an individual organization. (Albrecht, Stice, Stice, & Skousen, 2002) Managerial Accounting addresses those aspects that relates to an individual organization return on investments (ROI). (Albrecht, Stice, Stice, & Skousen, 2002) A company’s profitability depends on periodic attention to its assets turnover and profit margin. This process is designed to support the de... ... middle of paper ... ...egulator or auditor is going to insist that a company implement a good management accounting system. (Garrison, Noreen, & Brewer, 2010) The choice of how to collect and utilize information in a company is strictly management’s decision and is a part of the company’s competitive strategy. Financial and Managerial accounting are used for making sound financial...
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...Interpretation 36 Project Abstract The purpose of this paper is to look at FASB Interpretation No. 36, Accounting for Exploratory Wells in Progress at the End of a Period-an interpretation of FASB Statement No. 19. This paper will cover what is discussed, how the authority was found, what industry is affected, and what are the major organizational parts of that authority. FASB Interpretations are published by the Financial Accounting Standards Board (FASB). The interpretations extend or explain standards that have been published. They are part of the U.S. GAAP and there are currently 48 interpretations that have been published as of September 2006. In this paper we will look at FASB Interpretation No. 36 Accounting for Exploratory Wells in Progress at the End of a Period an interpretation of FASB Statement No. 19. Statement 19 specifies that companies should follow the successful efforts method of accounting for costs of acquiring, exploring, and developing mineral resources. It also specifies how capitalized costs should be amortized and addresses accounting for mineral property conveyances. Also addressed are the disclosure to be included in financial statements and accounting for income taxes. (fasb.org/summary/stsum19.shtml) Interpretation No. 36 addresses the questions that have been raised as to when to expense the costs of an exploratory well in progress that has been determined to be dry before the financial statements for that period have been issued. FASB requires...
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...Accounting Standards Boards Paper Jacobian Stephens ACC/541 June 29, 2015 Mrs. JoEtta Malone Accounting Standards Boards Paper The Financial Accounting Standards Board (FASB) started the Convergence program back in 2002 and stated that a three-part strategy for seeking greater comparability in accounting standards internationally should be implemented.. FASB sought out to develop a higher quality for Generally Accepted Accounting Principles (GAAP) standards and improve the relations and communication with additional nationwide standards setters. The convergence program is to help increase the quality of recording standards. FASB and IASB recognized that increasing the comparability of principles will not be as easy as they thought. To do so, they will need the help of setters around the world to have an agreement amongst the standards. We also have to remember that FASB priority is to improve financial reporting. Doing so will help investors. Eliminate any other alterations between IFRSs and U. S. GAAP that may remain on January 1, 2005 by undertaking projects that both Boards would address simultaneously. Carry on the progress on the joint projects presently proceeding. Inspire their consistent interpretative bodies to organize their activities. FASB has been the nominated union in the private division for generating standards of financial bookkeeping that administer the training of financial reports by non-governmental entities. To improve and establish principles...
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...Accounting Standards Boards Paper Accounting Standards Boards Paper This paper will discuss the relationship of the two accounting boards, International Accounting Standards Board (IASB) and the Financial Accounting Standards Board (FASB). Both groups are working on a venture known as the convergent project. The convergent project is an attempt by the IASB and FASB to eliminate differences between the International Financial Reporting Standards and the US GAAP. This paper will also explain how the MSA program will help students to prepare for a career in the accounting field. The Security Exchange Commission (SEC) was established by the Security Exchange Act in 1934. The SEC is the authority to establish financial accounting standards for publically held companies in the United States. The FASB was established in 1973 as the official body charged with issuing accounting standards. It is a private organization and is documented by the American Institute of Certified Public Accountants as well as the SEC. The mission of the FASB “is to establish and improve standards of financial accounting and reporting” (FASB.ORG, 2014). The FASB also oversees that reporting from publically held companies provide useful information investors, auditors and creditors, as well as anyone else who needs the information. The FASB issues Financial Accounting Standards (FAS) and other accounting pronouncements that make up the Generally Accepted Accounting Procedure. The GAAP is...
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...function and primary focus of financial accounting. Level of Learning: Easy 28. The primary focus for financial accounting information is to provide information useful for: A. Option A B. Option B C. Option C D. Option D AACSB: Reflective thinking Bloom's: Knowledge Learning Objective: 01-01 Describe the function and primary focus of financial accounting. Level of Learning: Easy 29. Which of the following is not true about net operating cash flow? A. It is the difference between cash receipts and cash disbursements from providing goods and services. B. It is a measure used in accrual accounting and is recognized as the best predictor of future operating cash flows. C. Over short periods of time, it may not be indicative of long-run cash-generating ability. D. It is easy to understand and all information required to measure it is factual. AACSB: Reflective thinking Bloom's: Knowledge Learning Objective: 01-01 Describe the function and primary focus of financial accounting. Level of Learning: Medium 30. Which of the following groups is not among financial intermediaries? A. Mutual fund managers B. Financial analysts C. CPAs D. Credit rating organizations AACSB: Reflective thinking Bloom's: Knowledge Learning Objective: 01-01 Describe the function and primary focus of financial accounting. Level of Learning: Medium 31. Which of the following was the first private sector entity that set accounting standards in the United...
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...Accounting Standards Board Paper Joy L. Stigall ACC/541 Accounting Theory and Research September 8, 2013 Heber Howard Accounting Standards Board Paper The accounting profession has been around for thousands of years. According to records, accounting can be seen as early as 1915 B.C. It wasn’t until 1494 that an Italian monk, Fra Luca Pacioli, wrote a book that included a description of double-entry bookkeeping system that enabled business organizations to keep complete records of transactions and ultimately resulted in the ability to prepare financial statements (Schroeder, 2011). This was just the beginning of the accounting profession. It has evolved to include many governing entities. One of the first was the Committee on Accounting Procedures, then the Accounting Principles Board, the Wheat Committee, Trueblood Committee and to where we are now, the Financial Accounting Standards Board (FASB). With the wide array of business relationships that we have developed in today’s time, the international business world has adopted the International Accounting Standards Board (IASB). These two boards have decided to adopt a convergence project. I am going to attempt to briefly show some similarities and differences in the two boards and how the Master’s program at the University of Phoenix will prepare me for the accounting profession. First let’s look at the FASB. They are the main governing board for accountants and govern the Generally Accepted Accounting Principles...
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...healthcare organizations face an intimidating financial situation in today’s healthcare atmosphere. “Decreasing revenues, increasing costs, and high consumer expectations present a complex challenge for healthcare administrators and medical directors who must not only manage in today’s climate, but also position their organizations for tomorrow’s storms” (Gale Group, 2004, p. 2). This paper will summarize the four elements of financial management; summarize generally accepted accounting principles and general financial ethical standards; and provide examples from articles that reflect ethical standards of conduct and financial reporting practices. Four Financial Management Elements Planning, controlling, organizing and directing, and decision making are the four elements of financial management. The purpose of planning is for the financial manager to identify the objectives and identify the steps required to achieve those objectives. The purpose of controlling is for the financial manager to review and compare current reports against previous data to ensure the plans, set by the organization, are being followed properly and efficiently. The purpose of organizing and directing is for the financial manager to ensure effective resource use and provide daily supervision. Lastly, the purpose of decision making is for the financial manager to make informed choices through primary tasks of analysis and evaluation. These four elements of financial management are the key to leading a...
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...Accounting Standards Building international opportunities for Australian business Corporate Law Economic Reform Program Proposals for Reform: Paper No. 1 © Commonwealth of Australia 1997 ISBN 0 642 26110 5 This work is copyright. Apart from any use as permitted under the Copyright Act 1968, no part may be reproduced by any process without prior written permission from the Australian Government Publishing Service. Requests and inquiries concerning reproduction rights should be directed to the Manager, Commonwealth Information Services, Australian Government Publishing Service, GPO Box 84, Canberra ACT 2601. The Government is seeking comments from interested parties on the detail of the proposals in this paper which should be forwarded to the following address:| First Assistant SecretaryBusiness Law DivisionThe TreasuryParkes PlacePARKES ACT 2600|Telephone:Fax:Email:|02 6263 396002 6263 2882clerp@treasury.gov.au| Copies of this paper are available from the Australian Government Publishing Service and on the Treasury web site (http://www.treasury.gov.au).Enquiries concerning the paper can be made to:Ms Veronique IngramAssistant SecretaryThe TreasuryTelephone: 02 6263 3970| Printed by the Australian Government Publishing Service Table of Contents Page Abbreviations v PART 1: Reform Proposals 1 PART 2: Introduction 9 2.1 Background 9 2.2 Key economic principles 10 PART 3: The Case for Reform 11 3.1 Impetus for reform 11 3.2 What the Government is seeking...
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...Abstract This paper is intended to explain a joint venture referred to as the convergence project, between the International Accounting Standards Board (IASB) and the Financial Accounting Standards Board (FASB) (FASB, 2002). This paper will also provide a brief history of the relationships between the two boards, and the equivalents between IASB and FASB. Along with an explanation of how the Master of Science in Accountancy Program helps prepare students for a professional life, within the accounting vocation. Accounting Standards Boards Within each country, there are different types of governments who follow different sets of regulations and require different accounting standards. With the current growth of global commerce, companies conducting business abroad require more consideration in there accounting, versus a business who only conducts commerce in one country. Many countries do not have the same level of regulation boards as the United States, who follows the standard set of principles by FASB, because of the accounting reporting differences, it is extremely important for any global organization to use IASB for best financial practices on a global scale. However with such a high-demand for global commerce, following different sets and types of accounting regulations has caused confusion and has become cumbersome to the stakeholders involved in international commerce (FASB, 2003). National Regulatory Boards Local and state laws, plus a host of regulatory commissions...
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...Proposed Statement of Financial Accounting Concepts Issued: March 11, 2010 Comments Due: July 16, 2010 Conceptual Framework for Financial Reporting: The Reporting Entity This Exposure Draft of a proposed Statement of Financial Accounting Concepts is issued by the Board for public comment. Written comments should be addressed to: Technical Director File Reference No. 1770-100 Responses from interested parties wishing to comment on the Exposure Draft must be received in writing by July 16, 2010. Interested parties should submit their comments by email to director@fasb.org, File Reference No. 1770-100. Those without email may send their comments to the “Technical Director, File Reference No. 1770-100, FASB, 401 Merritt 7, PO Box 5116, Norwalk, CT 06856-5116.” Do not send responses by fax. Please send only one comment letter to either the FASB or the International Accounting Standards Board (IASB), which is also requesting comments on this jointly issued Exposure Draft. The FASB and the IASB will share and consider jointly all comment letters received. Comments are most helpful if they: a. b. c. Indicate the specific paragraph or paragraphs to which the comments relate Contain a clear rationale Include any alternative the Boards should consider. All comments received constitute part of the FASB’s public file. The FASB will make all comments publicly available by posting them to its website and by making them available in its public reference room in Norwalk, Connecticut. An...
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...Death of the Operating Lease Running head: DEATH OF THE OPERATING LEASE 1 Death of the Operating Lease and its Impact on Leading U.S. Companies Mark S. Lynn Mount St. Mary’s University Copyright 2010, Mark S. Lynn Death of the Operating Lease Abstract The proposed elimination of operating lease treatment by the IASB and FASB, as outlined in 2 their discussion paper, Leases – Preliminary Views, will have a varying degree of impact on U.S firms. After a review of the evolution of lease accounting and a discussion of financial ratio analysis, this paper examines the impact of the proposed accounting change on common financial ratios of 142 large public companies. The proposal requiring the capitalization of all lease arrangements is generally detrimental to such financial measurements, with significant variability among industry sectors. Through surveys and interviews, it is further determined that while a majority of corporate financial executives do not support the proposed accounting change, they have yet to analyze the impact and prepare for the effects of the change within their own companies. Copyright 2010, Mark S. Lynn Death of the Operating Lease Death of the Operating Lease and its Impact on Leading U.S. Companies 3 “We are only tenants, and shortly the great Landlord will give us notice that our lease has expired.” ~ Joseph Jefferson (1897, p. 476). A lease is broadly defined as a contract by which an owner of property grants to another...
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...Reporting Practices and Ethics paper | HCS/405 – Louis Eubank | | Reporting Practices and Ethics Financial Management This paper will go over the various steps involved in financial reporting practices as well as the ethical standards in healthcare financing. Financial management is a major part of the health care facility running smoothly. There are numerous financial decisions made on a daily basis regarding business transactions and even some accounts (patient accounts, accounts concerning revenue). There are some ethics that those that are managing and reporting financial information should keep in mind. They are often referred to as the generally accepted accounting principles (GAAP). Each organization may have a different way of doing things but they do have to follow the organizations rules as well as the state and federal regulations. We will touch on that shortly. There are four aspects that take place in financial planning/management. I will be breaking down the elements and explaining each step and I will follow suit with the accounting code of ethics. Elements of financial management: The four aspects of financial management are: planning, controlling, organizing and directing and lastly decision making. Planning: This is the first step of the process and it is where the financial managers start to develop a plan with projections in revenue for each area in the facility. This is the area where expectations and goals are set. Employees are provided with...
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...Case 1 Understanding Financial Statements By Robert Kimble ACC 501 Dr. Tara Murphy August 29, 2011 In this paper, we are going to take a look at three companies and compare their 2010 income statement in regards to total revenues, operating income and net income. We are also going to review some financial terms and concepts that can affect how the data in their income statement is presented. After looking at some terms and how they are used, we will make some comparisons and reach some conclusions about those same companies. Lastly, we will look at how we compared and contrasted information in the income statement. So let’s get this paper started by taking a look into all three companies and we will start with Apple Incorporated. According to Apple’s company perspective, “Apple ignited the personal computer revolution in the 1970s with the Apple II and reinvented the personal computer in the 1980s with the Macintosh. Apple is committed to bringing the best personal computing experience to students, educators, creative professionals and consumers around the world through its innovative hardware, software and Internet offerings.” Now let’s look at Swatch, according to Swatch it, “is the world's leading supplier of watch movements and finished watches, accounting for as much as 25 percent of total world production, while capturing more than ten percent of all watch sales. The Swatch Group is more than its flagship Swatch brand--which alone accounts for half of...
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