Changing rooms in small company reporting: the Scottish Institute's new proposals seek a better reporting framework

Article Abstract:

The Institute of Chartered Accountants of Scotland (ICAS) has responded to the widespread dissatisfaction with the current framework for small company reporting by proposing measures for improvement. Its working party has published 'Breaking the Code ... A Better Reporting Framework for Small Companies' to seek public comment on these proposals. The ICAS has spotted 11 flaws in the current reporting framework and wants to revamp it based on the needs of the two groups of users. One group consists of those with the economic and statutory power to generate information beyond those included in company reports, while the other group comprises of those without such power, including employees, customers and prospective users. The ICAS is calling for a reporting model based on statements of basic company information, corporate objectives and shareholder policies, directors' management, and the company's results, financial position and future prospects.

Methods, Management, Evaluation, Small business, Financial statements, Institute of Chartered Accountants of Scotland

---

Peace and goodwill to all accountants?

Article Abstract:

The Accounting Standards Board's success in drumming up support for Financial Reporting Exposure Draft (FRED) No. 12 'Goodwill and Intangible Assets' reflects the body's political skill. Its working paper on which the exposure draft is based received strong support from all quarters, while a similar exposure draft (ED 47 'Accounting for Goodwill') issued by its predecessor, the Accounting Standards Committee, in 1990 was rejected by 93% of all corporate respondents. Both sets of proposals seek to have goodwill reflected on the balance sheet rather than being written off directly to reserves, but they have several important differences that influenced the outcome of the debate. One vital difference is that FRED 12 will allow capitalized goodwill to be subject to systematic amortization or to annual impairment tests. ED 47 did not offer such an option. Still, FRED 12 involves many practical difficulties that need to be addressed.

Accounting Standards Board, Intangible property, Intangible assets, Goodwill (Business)

---

FRS 6 and FRS 7: the troublesome twins

Article Abstract:

The Accounting Standards Board (ASB) published Financial Reporting Standard (FRS) No. 6, 'Acquisitions and Mergers' and FRS No. 7, 'Fair Values in Acquisition Accounting' in the autumn of 1994. Although the lengthy implementation periods should have provided preparers and auditors ample time to understand the new standards, they have actually encountered numerous headaches in complying with the two standards. Five major accounting difficulties have emerged as a result of FRSs Nos. 6 and 7. These are in relation to mergers, transitional effects, determining the consideration, onerous contracts and reverse acquisitions. These problems will continue to affect users of the standards while new ones will come up as the ASB deals with such topics as goodwill, intangible assets, pensions, deferred tax, discounting, impairment and provisions.

Acquisitions and mergers

Similar abstracts:

• Abstracts: Engaging customers in service creation: a theater perspective. Marketing research, market orientation and customer relationship management: a framework and implications for service providers
• Abstracts: Car dealer prosecuted. Tax charge hike looms: company earnings and balance sheets are threatened by proposed changes to treatment of tax in company figures
• Abstracts: Car companies wrestle with Internet challenge. Business-to-business grabs center stage in GM strike. Changing relationships
• Abstracts: Some empirical evidence from publicly quoted UK companies on the relationship between the pricing of audit and non-audit services
• Abstracts: Closing agreement prevented innocent spouse relief. Court holds that innocence need not mean total ignorance. Partial tax relief for partially innocent spouse

This website is not affiliated with document authors or copyright owners. This page is provided for informational purposes only. Unintentional errors are possible.