Assignment Question
The financial statements must "present fairly"
the financial position, financial performance
and cash flows of an entity. Fair presentation
requires the faithful representation of the
effects of transactions, other events, and
conditions in accordance with the definitions
and recognition criteria for assets, liabilities,
income and expenses set out in the Framework.
The application of IFRSs, with additional
disclosure when necessary, is presumed to
result in financial statements that achieve a fair
presentation. [IAS 1.15]
1
Assignment Question – cont’d
By using the relevant international
accounting standards (IASs) which are
taught in the module APC311, you are
required to provide critical discussions
on the above statement.
2
Assignment Question – cont’d




Your assignment should aim to provide readers with
comprehensive knowledge and critical reviews of this area
covering, for example:
A knowledge of different accounting treatments in
individual accounting standards
A knowledge of implications of different accounting
treatments on usefulness of financial statements
Your own understandings of, comments on, arguments
and contributions to the topic, such as key qualitative
characteristics, true and fair view/fair presentation,
creative accounting, etc..
Any other important issues which you think should be
addressed
3
Some Key words
 Fair presentation:
 Qualitative characteristics
 Individual accounting standards
 Usefulness of financial statements to various
users
 Critical discussions
 Needs a good understanding of the question
 Arguments, comments, discussions, suggestions,
etc.
 Not only introduction, description, and copy &
paste
4
Understanding
 What is fair presentation? or
 What is the usefulness of financial
statements?
 How can financial statements be fairly
presented (or useful to users)?
 What are individual IASs/IFRSs?
 How do different accounting treatments
in individual IASs/IFRSs impact on the
fair presentation? (creative accounting)
5
Understanding
 True and fair view/fair presentation
 4 qualitative characteristics
 IASs/IFRSs:








Accounting
Accounting
Accounting
Accounting
Accounting
Accounting
Accounting
……….
for
for
for
for
for
for
for
leases (IAS 17)
borrowing costs (IAS 23)
tangible fixed asset (IAS 16)
provisions (IAS 37)
impairment of assets (IAS 36)
intangible assets (IAS 38)
purchased goodwill (IFRS 3)
6
Understanding
**Different accounting treatments have
different impacts on financial statements**
7
Fair Presentation
IAS17
IAS23
Understandability
IAS38
Relevance
IFRS3
F. P.
Reliability
IAS16
Comparability
IAS36
IAS36
8
Tips
Understand the question
Review all topics delivered in the module
Do homework on creative accounting issue
Read recommended (Sunspace) and other
relevant readings
 Knowledge in your work:
 Precise and concise
 Relevant and comparative
 Essential and in-depth
 Constructive and innovative




9
Other issues
 Submission
 Library
 Friday 20th May 2011
10
Questions?
11