Theory and Current Issues in Accounting - AASB Framework

THEORY AND CURRENT ISSUES IN ACCOUNTING

EXECUTIVE SUMMARY
Australian Accounting Standards Board (AASB), in December 2013, incorporated certain
changes in the AASB framework for the presentation and preparation of financial statements.
Such changes included chapter 1 and 3 of the international accounting standard board's
(IASB) conceptual framework for financial reporting (September, 2010). When further
changes were made in IASB's standards, the AASB decided to make change in the AASB
framework to the extent of chapter 1 and 3 as necessary and retain the existing framework.
The Exposure Draft was made to include more areas than the existing one and a more
detailed description of such areas, disclosure requirements, and recognition and
derecognition, measurement financial performance, introduction of other comprehensive
income and the financial reporting entity.

Contents
INTRODUCTION......................................................................................................................3
Solution 1...................................................................................................................................4
Solution 2:..................................................................................................................................5
Solution 3:..................................................................................................................................7
Solution 4...................................................................................................................................8
Solution 5:..................................................................................................................................9
Solution 6:................................................................................................................................10
Solution 7:................................................................................................................................11
CONCLUSION........................................................................................................................12
Bibliography.............................................................................................................................13

INTRODUCTION
The current assignment is about AASB's accounting conceptual framework, 2014 that has
been applied upon financial reports prepared on or after July 1, 2014. It is expected by the
accounting industry to account for transactions in such a way that a qualitative report is being
made. Company accountants are expected to address the information which are critical in
nature for developing the appropriate accounting standard. The four fundamental issues are
definition of the element of financial statement, recognition and measurement of such
elements and appropriate disclosures related to that. The AASB has to consider the above
stated issues while presenting a framework for preparation and presentation of financial
statements (Atkinson, 2012).
However, controversies arises in relation to the fourth issue, that is, disclosure requirements.
The AASB framework of 2014 is criticized on this ground that proper guidance aren't
provided as to what disclosures should be made and not. The principles and practices
regarding disclosures are not clearly stated by AASB.