This website uses cookies to ensure you have the best experience. Learn more

Regulation Of Accounting Essay

4643 words - 19 pages

Nottingham University Business School
MSc Programmes

[N14B28—International Accounting]

Comparison of Accounting Standards in UK and Japan: The Case of BAE Company and Fujitsu Company

[Qianni Ouyang]; ID: [4118036]
[Anqi Shao]; ID: [4121763]
[Gurpreet Singh Sethi]; ID: [4148275]
[Xinfang Zhang]; ID: [4147673]

COPY [2]

I. Introduction
With rapid development of globalization, a great deal of attention is paid to accounting diversity in different countries. However, for managers and investors in the globally economic market , it is significant for them to understand the underlying factors influencing accounting reporting and disclosure practices, the ...view middle of the document...

Part of the social cultural environment, including political, economic, legal, science and education, is an important constituent accounting environment. The social culture contains the established social order, the traditional thought habit of the public, the values and the behaviors of the individuals in the society, which all have impact on the people’s attitudes and perceptions to the financial and accounting. (Franke, R. et al, 1991). In this case, certain elements of the social culture relative to the accounting system are taken into account, such as legal system, providers of finance, taxation, and the profession.

Company law exerts the primary impact on UK companies financial statement. The economic system of the United Kingdom is capital market-based financial system, which is formed by limited liability companies. The economic system determines that the accounting information serves the shareholders of the corporation rather than the creditors and government. In the legal environment, UK’s economic legislation belongs to the civil law system. The company law is an important foundation of the UK’s accounting mode. It contains disclosure requirement and presentation and measurement rules, which apply to any UK limited company. The company law put forward a ‘true and fair view’, to regulate all the accounting behaviors. The accountancy profession that was a founder member of the International Accounting Standards Committee (IASC) has had impact on the regulation of financial reporting.

Comparing with UK, the economic system in Japan is the government-dominated market economy. The government can intervene and control the enterprises’ operating activities directly. The accounting information, which is provided by the listed companies mainly, serves the macro-economic management of the central government. In the legal environment, Japanese economic legislation belongs to the civil law system. The government intervenes the micro-economic principle directly by legislation. To a certain degree, the accounting standards of Japan have a legal effect. Japanese companies rely heavily on the banks and other financial institutions. The heavy involvement of the banks and the long-term nature of share ownership means that there is less focus on short-term earnings information in Japan than in the United Kingdom.(Nobes and Parkers,2008). The government and creditors as the main demanders of the financial accounting information.

2.2 Regulatory Framework
For UK and Japan, different regulatory frameworks stem from different environmental factors mentioned above.

The regulation of accounting in U.K. involves the government, the profession and the oversight mechanism. The government regulates the statutory elements of the framework. The Consultative Committee of Accounting Bodies (CCAB) supervises their members for maintenance of accounting standards. The Professional Oversight Board oversights the profession (Elliot, B. and Elliot, J.,...

Other Papers Like Regulation of Accounting

The Pros and Cons of Regulating Corporate Reporting: a Critical Review of the Arguments

2513 words - 11 pages The pros and cons of regulating corporate reporting:A critical review of the arguments Robert Bushman, Wayne R. Landsman Accounting and Business ResearchVol. 40, Iss. 3, 2010 Introduction There were a series of scandals in the UK in the 90’s which resulted in the collapse of Barings Bank, due to this the Financial Services Authority changed the structure of financial regulation that consolidated regulation responsibilities. The

Communcating Accounting Standard Changes Essay

570 words - 3 pages The recent release of the Statement of Accounting Standards No. 112 regulation made it necessary to communicate the standard and its impacts to the accountants within the firm. It was also imperative to make our key clients aware of the regulation and how it might affect their business. Finally, to ensure seamless compliance with the regulation, we are educating our clients’ bookkeepers of the regulation and its ramifications on their duties

Lesson Plan Far600

1837 words - 8 pages | | | | |360 – 363) | |PART B |ACCOUNTING REGULATION AND SPECIFIC ISSUES | | | |5. Financial Reporting |Regulatory framework, uses and users of financial information in | |Tan Liong Tong, Chapter 1. | |Practice in Malaysia |the

Discuss The Need For Regulation In Financial Reporting

1540 words - 7 pages , some companies might adjust their liability figures in order to secure a loan or reduce their profit figures in order to pay less corporate tax. For this reason, there is a need for financial regulation. The second reason is that of comparability. Supposing the managers could be relied upon to provide accounting information on items and transactions of interest to other participant groups. What is the best or right way in which the

Accounting Careers

1667 words - 7 pages CAREER PAPER MUQRIN ALJHARI October 2, 2015 INTRODUCTION Accounting is popularly known as “language of business". Accountants are the practitioners of accounting, who can speak it better than anyone. It measures the results of a company’s economic activities and conveys this information to different users like creditors, investors, management, and regulators, etc. Accounting is the body of knowledge, which is primarily concerned with

Unit 1 Managerial Accounting

521 words - 3 pages : financial accounting and managerial accounting. Financial Accounting gives us a view of the financial position of the company. It is management’s responsibility to keep the accounting records in a way that gives us the correct view of the company; it must be free from any material misstatement, which may distort the reader. In order for it to be conveyed properly, management has to follow certain rules and regulation such as GAAP, IAS, etc

Development of Accounting

4609 words - 19 pages Standards................................................. 4 1.4 21st Century – Accounting Regulation in Modern Commerce ........................................................... 4 2. DEVELOPMENT OF ACCOUNTING .................................................................................. 4 3. EVOLUTION OF ACCOUNTING ......................................................................................... 5 4. THE CONSEQUENCE OF

Accounting Regulatory Bodies

914 words - 4 pages There are many accounting regulatory bodies, like the Securities and Exchange Commission. Each one performs specific tasks and sets regulations for the accounting industry. This paper will discuss the responsibilities of four regulatory bodies. The paper will also discuss how organizations comply with the standards of these four regulatory bodies.U.S. Securities and Exchange CommissionInvesting in stocks and bonds is not only lucrative, but can


640 words - 3 pages the analysis of this article and considering the effect of Sarbanes-Oxley Act on financial statements, an interesting question pops up: is there a need for internal controls when it is known that the senior management can manipulate the internal controls? References Hart, O. (2009). Regulation and Sarbanes-Oxley. Journal of Accounting Research, 47(2), 437-445. Retrieved from Xaxx, J. (n.d). What Are the Causes of Ethical Lapses in Accounting? Retrieved from

Effect of Unethical Behavior Article Analysis

570 words - 3 pages profit corporations, and to board off further regulation by state governments, some of which are considering legislation that incorporates percentages of Sarbanes-Oxley for nonprofit organization. In conclusion, this paper analyzed the different situations that would lead to unethical practices and behavior in accounting. This paper also examined the effects of the Sarbanes-Oxley Act of 2002 on financial statements. This paper explained that The

Accounting Standards Boards

1127 words - 5 pages countries do not have the same level of regulation boards as the United States, who follows the standard set of principles by FASB, because of the accounting reporting differences, it is extremely important for any global organization to use IASB for best financial practices on a global scale. However with such a high-demand for global commerce, following different sets and types of accounting regulations has caused confusion and has become

Related Essays

History Of Accounting Regulation In Fiji

1584 words - 7 pages , November 2002. Worldcom 2002: Yet Another Corporate Scam On June 26, 2002, the US-based telecommunications major WorldCom received unprecedented media coverage all over the world. Not for good reasons though. The company had earned the dubious distinction of being involved in the largest accounting scandal ever to hit the US corporate history. WorldCom had reportedly misrepresented its financial statements to an extent of around $ 4 billion

Alternative Fair Value Essay

1205 words - 5 pages Accounting regulation The Learning Objectives for this lecture: Regulatory framework Role of a conceptual framework Current state of play of conceptual framework for international standards Different approaches to accounting regulation •Free-market approach EMH Agency theory •Regulatory approach market mechanisms will not be able to achieve a socially optimal equilibrium price for accounting information Theory of efficient

Annual Report

3560 words - 15 pages Final exam period All components of the above assessment are compulsory and must be submitted. Raw marks can be scaled up or down to get to the final mark. You must obtain 50% or more as final mark to be eligible for an automatic pass grade in the course. Research School of Accounting and Business Information Systems 9 3 Lecture 1 Regulation and operation of Australian companies • Nature and regulation of companies (Chapter 1

Concept Of Accounting Essay

1764 words - 8 pages Rockefeller Morgan and Carnegie Cost Accounting in the Era of Big Business Alternative Systems in Asia and Europe Relevance Lost: The Critique of Johnson and Kaplan The American Response 4. Financial Accounting and the Structure of Accounting Regulation The Great Crash and Government Response The New Role of the Accounting Profession The Financial Accounting Standards Board Earnings