Chapter 13
STANDARD SETTING: POLITICAL
ISSUES
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Overview
Perspektif teori ekonomi: pertanyaan tentang
luasnya (extent
(extent)) regulasi akuntansi dan standar
pelaporan mengawatirkan (unsettled
(unsettled))
Walau kita dapt menyarankan sejumlah insentif
kontraktual dan berbasisberbasis-pasar bg produksi inf khusus
(private
private),
),
kita tdk tahu apakah kegagalan pasar yg meningkat
akibat dari deregulasi keputusan produksi inf persh
akan lebih atau kurang mahal kpd masyarakat dp
berbagai biaya proses penyusunan standar
Problema kegagalan pasar adl begitu fundamental
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Overview
Asimetri inf (dan problema yg diakibatkan, moral
hazard--MH dan adverse selectionhazard
selection-AS) yg
menciptakan permintaan unt produksi inf oleh
persh, juga menciptakan permintaan unt
regulasi atas produksi inf itu, hal ini disebabkan:
Problema unanimity
unanimity—
—jumlah inf yg akan dihasilkan
sendiri persh, dan umumnya tidak akan terjadi, sama
dengan jumlah yang investor inginkan
Akibatnya, investor bisa mendorong regulasi untuk
memperbaiki defisiensi yg dipersepsikan
Penyusunan standar scr fundamental mrp
proses ekonomik yg besarnya sama dengan
proses politik
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Overview
Tujuan chapter ini unt
Membahas dua teori regulasi
Teori kepentingan publik (public
(public interest theory—
theory—PIT):
memandang bhw regulasi seharusnya memaksimumkan
kemakmuran sosial
Teori kelompok kepentingan (interest
(interest group theory—
theory—IGT):
memandang bhw individu membentuk koalisi/ konstituen untuk
memproteksi dan mempromosikan kepentingannya dg melobi
pemerintah, koalisi dipandang sbg konflik satu dg lainnya untuk
meraih bagian manfaat dari regulasi
Menguji proses penyusunan standar
Mempertimbangkan kriteria yg diperlukan penyusun
standar bahwa standar yg mereka susun akseptabel
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Organisasi Bab 13
Teori
kepentingan
publik
Org badan
akuntansi
profesional
Teori Regulasi
Penys standar:
konflik &
kompromi
Kesimpulan:
aplikasi teori klp
kepentingan
Teori
kelompok
kepentingan
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Teori kepentingan publik
Public Interest theory/PIT
Menyarankan: regulasi adl hasil dari permintaan publik
unt koreksian kegagalan psr
Asumsi: sbg sentral autoritas memiliki kepentingan
terbaik dr masyarakat
Regulasi: pemikiran tentang pertukaran (tradeoff
(tradeoff)) antara
biaya regulasi dan manfaat sosialnya dlm bentuk operasi
pasar yg meningkat
Problema pandangan PIT: kulitnya saja (superficial
(superficial))
& mungkin naif
Tugas sangat kompleks tentang memutuskan atas
jumlah yg benar atas regulasi
Motivasi badan pengatur
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Teori kelompok kepentingan
interest group theory—
theory—IGT):
Memandang bhw suatu industri beropersi dlm
keberadaan sjumlah kelompok kepentingan
(konstituen)
E.g, industri pemanufakturan, konstituennya:
konsumen, ahli lingkungan,
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Organisasi Badan Akuntansi Profesional
Kanada--CICA:
Kanada-CICA: The Canadian Institute of
Chartered Accountants
Amerika-Amerika
--AICPA= American Institute of Certified Public Accountants
Indonesia—
Indonesia
—IAI= Ikatan Akuntansi Indonesia
?????? IAI= Ikatan Arsitektur Indonesia ??????????
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Organisasi Badan Akuntansi Profesional
Kanada--CICA:
Kanada-CICA: The Canadian Institute of
Chartered Accountants
Komite Standar Akuntansi:
AcSB (Accounting Standards Board)
AASB (Auditing and Assurance Standards Board), dan
PSAB (Public Sector Accounting Board)
Hasil kerja komite standar akuntansi= CICA
Handbook, berisi standar unt akuntansi keuangan
dan unt pengauditan, yg diletakan oleh AcSB dan
AASB
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Organisasi Badan Akuntansi Profesional-Kanada
Berbagai tahapan unt menciptakan standar baru
menunjukkan bahwa prosesnya adl kental dg
politis, dg tekanan pd proses akhir (due
(due process)
process)
Banyak dr konstituen akuntansi diundang unt ambil
bagian
Konstituen peran: sbg bagian dari proses yg
menyebabkan penyisipan suatu item ke dlm agenda
badan, maupun sbg anggota badan sendiri, atau sbg
responden unt draf ekspos
Jk proses adl scr ketat ekonomis, perwakilan berbasis
badan tidak perlu slm standar yg benar dpt scr
sederhana dideduksi dr teori
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Parties Involved in Standard
Setting--U.S
Setting
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Parties Involved in Standard SettingSettingU.S
AICPA: American Institute of Certified Public
Accountants
CAP--Committee on Accounting Procedure 1939
CAP
1939--1959
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Part--time, volunteer, appointed.
Part
Issued ARBs (Accounting Research Bulletins)
Bulletins) listed on text inside
front cover.
Not thorough or involved enoughenough-piecemeal approach.
No basic theory established.
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Parties Involved in Standard
Setting
APB- Accounting Principles Board 1959
APB1959--1973 Senior Committee of
the AICPA.
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Issued Opinions
Opinions,, listed on text inside front cover.
Formed to settle problems and do research.
More authority than CAP.
18
18--21 members, partpart-time and poorly paid. Challenged early on from
various constituencies.
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Parties Involved in Standard Setting
Wheat Committee formed to address need for coherent approach to
theory and practice. Recommended the formulation of:
FASB-Financial Accounting Standards Board (1973
FASB(1973--present)
Seven highly paid, fullfull-time members from various constituencies
(practice, research, users). 55-year terms.
Independent of AICPA, under the auspices of the Financial
Accounting Foundation (FAF).
The
FAF selects the members of the FASB.
The
FAF oversees the Financial Accounting Standards Advisory
Council (FASAC) which has the responsibility to consult with the
FASB on major policy and technical issues.
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Parties Involved in Standard Setting
FASB has broader representation than CAP or APB.
Member need not be a CPA.
FASB issues:
•Standards
•Interpretations
•Concepts
•Technical Bulletins
•Industry Guides
•Please see figure 1-5 House of
GAAP (text).
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Parties Involved in Standard Setting
DUE PROCESS: To develop standards (GAAP) (page 10, text)
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A topic or project is identified and placed on FASB’s agenda.
A task force is assembled to define problems, issues and
alternatives.
Research is conducted by FASB technical staff.
A discussion memorandum is drafted and released.
Public hearings are held in a timely manner.
The FASB committee analyzes and evaluates public response.
The FASB committee deliberates and prepares and exposure
draft..
draft
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Parties Involved in Standard Setting
Again,
public hearings are held in a timely manner,
comments taken.
The
FASB committee evaluates the public comments
and revises the draft as necessary.
The full board of FASB reviews
final draft and, if approved by a
vote of at least 5 of 7, issues a
FASB
Standards Statement.
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FASB: A Look to the Future
Public versus Private regulation of profession. The Accounting Profession
seeks to govern itself directly rather than have the government directly draw
up the GAAP to be followed.
Should Securities and Exchange Commission exercise direct oversight?
Congressional Actions:
Metcalf--MossMetcalf
Moss-Revised due process procedures.
Dingell Committee (1985)(1985)-Standard setting process sufficient.
Trueblood CommitteeCommittee-Set up Accounting Change Commission.
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FASB: A Look to the Future
Standards Overload v. Timely Guidance
Big GAAPGAAP-Complex registrants.
Little GAAPGAAP-Nonregistrants, smaller firms.
Very specialized standards-standards--Too
Too complex or complex issues?
Standard overloadoverload-A quick look at textbook inner covers for dates
demonstrates how numerous and complex new standards have become!
Timely guidanceguidance-Due process too long? If faster will issues be adequately
addressed?
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FASB: A Look to the Future
FASB response:
Set up two sets of standards?: OCBOAOCBOA-Other Comprehensive Basis of
Accounting--problems, comparability, consistency.
Accounting
Increased use of EITFEITF-Emerging Issues Task ForceForce-to prioritize concerns.
Emerging Issues Task Force:
Set up by FAF to advise FASB.
16 members -no user representation!
Prioritizes issues and treatment:
General consensus there is preferable treatmenttreatment-no further study.
No consensus but problem narrownarrow-no further action.
No consensus but agreement important-important--FASB
FASB attention.
Is it usurping the FASB’s role?
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FASB: A Look to the Future
Preparer dominance in setting GAAP (resource allocation)?
Vested interest in simplicity and “work product”.
Reduced SEC involvement lately.
Some wish to change focus of reports from public to management!
Preparers have severely criticized the FASBFASB-not “blue ribbon”.
To prevent abuse Users should remain active!
Greater SEC involvement; preparers
Members of the
FAF selected
carefully
(independent).
lose most by direct regulation.
Careful selection of FASB
board members.
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Other Important Rulemaking
Bodies
SEC--Securities and Exchange Commission
SEC
First group to draw up professional standards.
1933 Act-Act--Set
Set up commission and governed initial issuance of shares.
1934 Act-Act--Governed
Governed subsequent trading in shares.
Statutory power to govern professionprofession-uses “veto power”.
Issues :
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FRR (Financial Report Releases)
Regulation SS-X which contains instructions and forms for filing financial
statements.
Decisions on cases coming before the SEC.
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Other Important Rulemaking Bodies
Need for regulation arose chiefly out of the corporate characteristic of the
separation of ownership and control. Regulation of Securities in the U.S.
(federal)
Federal Trade Commission Act (Interstate commerce)
Clayton Act (Interstate commerce)
Early attempts at regulation failedfailed-no “big problem” yet.
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Other Important Rulemaking Bodies
Regulation of Securities in the U.S. (state)
Kansas 19111911-by 1913 22 states had regulatory lawslaws-”blue sky” laws.
Not terribly effective.
Abuses in 1920’s
Price manipulation “wash sales”.
Purchase on “margin”.
Insider trading.
Establishment of the SEC
Charged to ensure “full and fair disclosure”, concern for fraud and
securities registration.
Accused of selfself-interest and accumulating power-power-- hopefully it serves the
public.
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Other Important Rulemaking Bodies
Growth of SEC
From tentative acceptance SEC has grown and become more involved.
1962--market disruption brought amendments1962
amendments-Exchange Act.
1977-Foreign Corrupt Practices Act1977Act-Criminal penalties possible for
management and accountants; adequacy of internal control.
1984--Insider Trader Sanctions Act1984
Act-increased penalties.
Question still remains as to how effective SEC is in regulating capital markets.
Exercises veto power over accounting profession although vested with
direct authority (as discussed before).
Regulated filings adequate?
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Other Important Rulemaking Bodies
Organizational Structure of SEC:
Office of the Chief Accountant is the most powerful in the United States!
Responsible for administration of laws.
Works with the FASB.
Works with many other organizations (e.g., major stock exchanges).
Enforcement by SEC:
Letter of deficiency used if there are
questions, irregularities that arise in the
financial statements, reports. If the
problems persist, a “stop order” will
be issued. Criminal charges are possible.
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Other Important Rulemaking Bodies
GASB
GASB--Governmental
Accounting Standards Board
-1984
Under
the auspices of the FAF.
Operational
Deals
with state and local governmental issues.
Unclear
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structure similar to the FASB.
its relationship to FASBFASB-do we need two?
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Issues in Financial Reporting
Primary Purpose of Financial Accounting: Financial statements that shall not
mislead the reader.
GAAP-Rule 203GAAP203-Code of Professional Conduct-Conduct--Lends
Lends enforceability to
GAAP.
“Expectations Gap” This is the difference between what the public
expects accountants will be able to do and be responsible for and what
the accounting profession is willing and able to assume responsibility
for.
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Issues in Financial Reporting
International Accounting Standards Committee (IASC)
Formed in 1973 to improve standards (as much as possible) in the preparation
of the financial statements.
SEC has indicated international companies may use IASC standards in the US
if the IASC meets 3 conditions.
The standards constitute a comprehensive, generally accepted basis of
accounting
The standards are of high quality and
They be rigorously interpreted and applied.
We will be considering several ethical issues or cases during the course of the
semester. Along with other references, please see pages 19 & 20 of your text for
the basic steps in the process of enhancing ethical awareness.
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ABRIVIATION
AICPA= American Institute of Certified Public Accountants
CAP = Committee on Accounting Procedure 19391939-1959
APB = Accounting Principles Board 19591959-1973 (Senior Committee of the
AICPA).
FASB=Financial Accounting Standards Board (1973(1973-present), has broader
representation than CAP or APB,Member need not be a CPA.
SEC =Securities and Exchange Commission, First group to draw up
professional standards,1933 Act-Act--Set
Set up commission and governed initial
issuance of shares,1934 Act-Act--Governed
Governed subsequent trading in shares,Statutory
power to govern professionprofession-uses “veto power”.
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Organisasi Badan Akuntansi
Profesional-Indonesia
Standar Akuntansi Pelaporan Keuangan
Th 1973: PAI (Prinsip Akuntansi Indonesia)
Th 1984: PAI
Th 1994: PSAK (Pernyataan Standar Akuntansi
Keuangan)
Standar Pengauditan
Th 1973: Norma Pemeriksaan Akuntan
Th 1994: Pernyataan Standar Akuntan Publik
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Kriteria Penyusunan Standar
Ada banyak faktor yg mempengaruhi penyusunan
standar
Kriteria penyusunan standar
Standar hrs menjadi keputusan yg berguna
Standar jug harus akseptabel unt konstituen yg lain, khususnya
manajemen
manajemen
penyusun standar berada pd situasi konflik & sulit
memprediksi apa resolusi yg akseptabel dari konflik ini
Kebermanfaatan keputusan
Penurunan asimetri informasi
Konsekuensi standar baru
Aspek politis penyusunan standar
Proses aktual penyusunan standar lbh baik digambarkan
dg IGT tentang regulasi dp PIT
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