Financial Accounting Homework: Recent Developments and Statement

This financial accounting homework assignment provides an overview of recent developments in financial reporting, focusing on global entities, superannuation entities, share-based payments, and new standards issued by IASB, PCAOB, FASAB, and GASB. It details the implications of these updates on financial reporting practices. The assignment also includes a comprehensive statement of financial position, outlining current and non-current assets, liabilities, and equity. The statement provides a clear snapshot of the company's financial health, with detailed figures for cash, receivables, inventory, land, plant, and various liabilities such as accounts payable, tax liabilities, and provisions. The assignment is supported by references to key sources like EY, IAS plus, FASB, and IFRS.

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Answer 1:
Recent developments in financial reporting:
Global entities:
The year 2017 marks the first year in which the significant global entities would prepare the
general purpose financial statements and also submit the same to the Australian Taxation
office. These financial statements prepared must correspond to the income year and must be
handed over to the Commissioner by the time he company is able to lodge its tax return.
Superannuation entities:
The superannuation investments in the country of Australia totals to about $2 trillion. And it
is for this reason that the members of the superannuation funds must have an access to the
information which is easy to understand when it comes to the overall performance. From this
year, the financial statements of the superannuation funds would show in the benefits that the
members are entitled to and also, whether this fund is likely to be able to pay in the benefits.
These new requirements replaces the AAS 25 which relates with the financial reporting by
the superannuation plans. These apply to the larger superannuation companies which are
regulated by the Australian Prudential Regulation authority and also to the superannuation
entities of the public sectors. These new requirements fails to apply to the self-managed
superannuation funds and also results in some of the significant changes in the presentation,
measurement and also to the disclosure requirements. When it comes to the initial
application, these entities are not required to present the statement of financial position (EY,
2017).
The next steps would include in the facts for the entities that have not yet adopted the ASC
606. The effective date for the same would be aligned in with ASC 606. In respect of the
business entities that are already following it, the same is effective for the fiscal years which

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begins after December 15, 2017. This includes the interim period within the stated fiscal year.
As for the other companies, the effective data is after the fiscal year December 15, 2018 and
also the interim periods within the fiscal years which begins on or after December 15, 2019.
Share-Based Payment:
The FAS issued ASU 2017-09 which deals with the amendment in the scope of the
modification accounting for the arrangements pertaining to the share based payments. It
provides insight into the terms and the conditions of the wards of the share based payments
that would be required for the application of the modification accounting under the ASC 718.
An entity would not apply the modification in case, the fair value, vesting conditions,
classification of the wards are somewhat same as were before and after the modification took
place. The following is the link for the same:
http://www.fasb.org/jsp/FASB/Document_C/DocumentPage?
cid=1176169021134&acceptedDisclaimer=true
IASB Issues New Insurance Contracts Standard:
IASB released the IFRS 17 which deals with the principles for the recognition, measurement,
presentation and the insurance contract disclosures. The main aim of this standard is the
reduction of the diversity in practice which rose due to the IFRS 4. This standard allowed the
company to carry on the accounting for the insurance contracts by the way of using the
national accounting standards which results in many of the different approaches.
The development would be lead to an increased comparability by the way of requiring in all
of the insurance contracts to be accounted for in a consistent manner.

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PCAOB Issues Standard on Auditor’s reporting Model:
The PCAOB has recently released a standard relating with the reporting by the auditors
wherein a new section by the auditors will have to be added in their report which is named as
“Critical audit matters” wherein the main considerations that contorts to CAM and the way in
which he has addressed these issues and also would contain the other accounts and the
disclosures in the financial statement (IAS plus, 2017).
FASAB Issues Statement on Tax Expenditures:
The FASAB has issued a statement wherein the narrative disclosures and the information
pertaining to the tax expenditures will have to be reported in the governments consolidated
financial report. This would help the users of the financial statements in understanding the tax
expenditures, their purposes, impact on the collection of the taxes and the contribution to the
costs pertaining to the programs (FASB, 2017).
GASB Issues Guidance on Certain Debt Extinguishment Issues
The GASB had issued a statement wherein the transactions which includes cash and other
monetary assets that have been acquired using the existing resources or the resources other
than the proceeds of refunding the debt would be placed in a trust that would be irrevocable
for the purposes of extinguishment of the debt (IFRS, 2017).
GASB Issues Implementation Guide Related to OPEB Standard:

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As per this development, a guide including the scope and the applicability of the statement
74, types of the post employ mental benefits, defined benefit OPEB plans which have bene
administrated through the trusts etc have bene defined out.

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Answer 2:
The following is the Statement of financial position:
Statement of financial position
Current assets: Amounts in $
Cash at bank
18,200.0
0
Cash management account
1,50,000.0
0
Accounts receivable
1,09,300.0
0
Interest receivable
6,700.0
0
Inventory
2,12,400.0
0
Raw materials
1,00,500.0
0
Prepaid rent
13,600.0
0
Total current assets
6,10,700.0
0
Non-current assets:

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Land (at cost)
11,00,000.0
0
Plant and equipment, net of accumulated depreciation
5,47,900.0
0
Goodwill
68,300.0
0
Investment property
6,14,000.0
0
Loan receivable
60,000.0
0
Total non-current assets
23,90,200.0
0
Total assets
30,00,900.0
0
Current liabilities:
Accounts payable
75,800.0
0
Current tax liability
33,500.0
0
Accrued wages payable 8,200.0

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0
Interest payable
8,300.0
0
Dividends payable
45,000.0
0
Provision for annual leave
19,000.0
0
Provision for long service leave
8,000.0
0
Provision for warranty
5,000.0
0
Total current liabilities
2,02,800.0
0
Non-current liabilities:
Debentures (due April 2020)
6,00,000.0
0
Bank Loan
5,00,000.0
0
Provision for annual leave
17,000.0
0
Provision for long service leave
19,000.0
0
Provision for warranty 12,000.0

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0
Total non-current liabilities
11,48,000.0
0
Total liabilities
13,50,800.0
0
Net assets
16,50,100.0
0
Equity:
Share capital
5,00,000.0
0
General reserve
2,76,800.0
0
Retained earnings
8,73,300.
0
Total equity
16,50,100.0
0