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Financial Accounting Theory Assignment

   

Added on  2020-04-29

16 Pages4446 Words46 Views
FinanceLeadership ManagementPolitical Science
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Financial Accounting Theory
Financial Accounting Theory Assignment_1

TABLE OF CONTENTSQuestion 1........................................................................................................................................4Question 2........................................................................................................................................6Question 3........................................................................................................................................7Question-4........................................................................................................................................8Stakeholder Theory......................................................................................................................8Social and Economic Consequences of Accounting Social Contract..........................................9Question 5......................................................................................................................................10question- 6.....................................................................................................................................11Positive Accounting Theory (PAT)...........................................................................................11Normative Accounting Theory..................................................................................................12Question -7.....................................................................................................................................12References......................................................................................................................................14
Financial Accounting Theory Assignment_2

List of FiguresFigure 1: Graph representing fall in share value of CBA in last five days......................................4
Financial Accounting Theory Assignment_3

QUESTION 1The CBA (Commonwealth Bank of Australia) has diminished its share price from 1.5 percent to76.60 (Sean, 2017) percent since shareholders were taking in the news that ARPA (AustralianPrudential Regulatory Authority) banking regulator might glance at the company. ARPA is the body based on overseeing the superannuation, insurance and loan sectors ofAustralia. It has substantial authority and recently ordered banks to slow down their activities ofproviding loans to the property investors .Commonwealth bank and ARPA has declared thatsupervisor shall introduce a free panel in order to examine several issues which have concernsabout the structure and exercises held in accountability, ethics and governance in commonwealthbank group, and have ruined the reputation of the bank and public standing. ARPA stated that bank is financially strong and capitalized. Further, theinvestigation is based on the internal financial workings of CBA. Theobjective of this damage is to determine any shortage and is inclusiveof assessing if or of not the organizational framework of group,governance, accountability, financial goals and remuneration iscontradictory against the compliance results and risk management.CBA has been a point of attraction because of its various scandals regarding the GFC. Recently,it faced money laundering claims, wealth and life insurance scandals. Nonetheless, ARPAannounced that the panel would not make any decisions on issues which are present prior to thecited court. Further, the investigation will be general and assess aspects of conflicts of interest (inwhich the incentives overrule the best interest of consumers). CBA is bearing investigation costs,however they are not likely to be significant regarding the company.Finance experts who believe that CBA is a well-meant organization in its best interest toconsumers. On the other hand, the involvement of banking operations with regulators is usuallytame and typically engages a polite backwards and forward (Reddy and Wong, 2016). ARPAcontains the authority to impose changes. However, weak company culture and authority can becomplex to measure and hence, difficult to alter tangibly. Consequently, in accordance with the
Financial Accounting Theory Assignment_4

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