Contemporary Accounting Theory

Running head: CONTEMPORARY ACCOUNTING THEORY
Contemporary Accounting Theory
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1CONTEMPORARY ACCOUNTING THEORY
Executive Summary
The discourse of the study aims to review the literature of Australia and Singapore’s regulatory
requirement for the financial reporting. The discussions on the individual regulatory environment
has commented on the various types of the perceived problems of the regulatory environment of
the individual countries. It has also stated about the different aspects of the how the environment
works and who are the major decision makers. Some of the other discussions have been related
to the discussion associated to the what legislation is required. The report has also discussed
about the country’s progress towards the adoption of IFRS. The findings of the study have found
that IFRS compliance to the legal and political environment and this has been a major challenge.
In various cases the presentation of information and understanding of the technical knowledge
has been a major challenge to the adoption of the regulatory framework. In addition to this, the
challenges in the Singapore has been discerned with the challenges pertaining to the initiating
new revenue standard. This is considered with in accordance to the EY “poll of 53 finance
executives in Singapore, conducted in late November 2016”. More than 62% of the respondents
of the poll have indicated that they have not started identifying and evaluating the key impact of
FRS 115. The comparison of the regulatory framework has stated that Australia in in a better
position for complying with the regulatory framework in compare to Singapore.

2CONTEMPORARY ACCOUNTING THEORY
Table of Contents
Introduction......................................................................................................................................2
Part A...............................................................................................................................................2
The perceived problems of each system..........................................................................................2
Working of Regulatory Environment..............................................................................................3
Country’s progress towards the adoption of IFRS..........................................................................4
Part B...............................................................................................................................................5
Regulatory Capture Theory and its usefulness................................................................................5
Characteristics indicating regulatory environment might be “captured”........................................6
Conclusion.......................................................................................................................................6
References........................................................................................................................................8

3CONTEMPORARY ACCOUNTING THEORY
Introduction
As discussed by Bryce, Ali, & Mather, (2015), “Financial regulation” is identified as that
form of rule which subjects financial organizations to consider “certain requirements”, guideline
and restrictions aiming to maintain the integrity within the financial system. These regulations
may be both “government or non-government organization”. In addition to this, financial
regulation has influenced the structure of banking sectors by increasing the variety in the
availability of the financial products. The report has undertaken the literature review of Australia
and Singapore’s regulatory requirement for the financial reporting. The discussions on the
individual regulatory environment has commented on the various types of the perceived
problems of the regulatory environment of the individual countries. It has also stated about the
different aspects of the how the environment works and who are the major decision makers.
Some of the other discussions have been related to the discussion associated to the what
legislation is required. The report has also discussed about the country’s progress towards the
adoption of IFRS. The second part of the report has analysed each of the selected environment
and assessed the financial regulatory environment through the lens of Regulatory Capture
Theory. To explain these topics, the report has highlighted on the “what regulatory capture
theory is and why is might be useful”. It has also discussed about the characteristics which may
indicate the that a regulatory environment might be “captured” (Chen, Ng, & Tsang, 2015).
Part A
The perceived problems of each system
The implementation of IFRS in Australia was depicted with the motive to improve the
“standards, comparability, accuracy and transparency of financial statements for a company
within a particular period”. However, the adoption of IFRS in Australia is depicted with the
issues such as lack of training, “problem for the entities, auditors, regulators as well as the
interesting parties who are familiar with previous accounting standards”. This is also considered
as a major challenge for adhering to the necessities of gaining addition skills for application and
evaluation of “IFRS”. Some of the significant issues has been also seen with the IFRS
compliance to the legal and political environment and this has been a major challenge. In various