Accounting Standards of Woolworths Australia

ACCOUNTING STANDARDS 1
Accounting standards of Woolworths Australia
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ACCOUNTING STANDARDS 2
Accounting standards of Woolworths Australia
The evaluation and regulations of the accounting standards for every company
operating in the private and public sector in Australia are governed by the Australian
accounting standards Board (AASB). The agency is mandated with the role of developing
and regulating the accounting standards in Australia. It is meant to develop accounting
standards which are in harmony with the international accounting standards. This study
critically evaluates the accounting standards of Woolworths by reviewing four articles. The
scope of the study extends to cover a summary of the accounting standards theory and its
progression in the field, comparison of the themes included in the articles, the managerial
implication together with the study limitations and future research proposed in the selected
articles. The selected articles include Brennan & Kirwan (2015), Sacer (2015), Palea (2013)
and Ahmed, Chalmers and Khlif (2013).
Summary
The setting of accounting standards in Australia can be traced back to 1966 when the
professional accounting bodies partnered with Australian accounting research foundation. An
accounting standards board formed by the AARF developed the standards. The board had
only managed to develop few standards by mid-1970s. The members of the profession were
the only ones who were required to comply with the set standards. Before the mid-1970s, the
setting of standards for public sector accounting was left in the hands of the department of
finance and treasury. International accounting stakeholders. The joint committee of public
accounts advocated for the need to form a public sector audit and accounting committee and
also advocated for conceptual framework concerning government accounting. The absence of
interest by profession necessitated the public sector to promote its own accounting standard-
setting body. However, this triggered a response by professional bodies where they
established the public sector accounting standards board (PSASB). A multi-cooperative
approach was employed by the board where they jointly worked together with Australian
accounting research foundation (AARF) and the accounting standards board (ASB). The
accounting standards have progressively developed to expand its scope to ensure the
harmonization of local accounting standards to international accounting standards. The
corporate law and economic reform of 1997 contributed to the establishment of the financial
reporting council with the mandate of setting the accounting standards. The issues
characterizing the development and progress of accounting standards in Australia include
harmonization and compliance.
Comparing and contrasting the themes
A review of the various articles used in this study reveals some common themes
relating to accounting standards theory in Australia which can be attributed to Woolworth
limited. One of the common themes across the articles is accounting standards compliance.
Brennan & Kirwan (2015) notes how Woolworth company have formulated a risk
management compliance and audit committee to conform with the designed financial
reporting framework. They note that the committee is mandated to advise the company’s
board on risk management of the accounting compliances, internal controls and accounting
policies. Sacer (2015) outlines the compliance documentation where the company documents
the various assumptions relating to accounting standards and principles including the income
and expenses accounting, the assets and liabilities accounting and the going concern
accounting. According to Palea (2013), the accounting standards which are set by the relevant
bodies need to be evaluated to enhance compliance. On the same theme, Ahmed, Chalmers
and Khlif (2013) emphasize the need for every organization to ensure compliance with the set