International Accounting Standards Codification System

In 1973 the Financial Accounting Standards Board (FASB) was established to set the financial accounting standards in the United States of America for nongovernmental entities. These standards are collectively called U.S. Generally accepted Accounting Principles, or U.S. GAAP. The Securities and Exchange Commission (SEC) and the American Institute of Certified Public Accountants acknowledge the authority of these standards (FASB, n.d). A “proven, independent due process” is used to collect the viewpoints of the financial statements prepares and users for the constant improvement of these standards. An Accounting Status Update(ASU) is not an authoritative source however documents the amendments to communicate the changes in the FASB Codification for a user to understand the reason and future of those changes (FASB, n.d).

The changing nature of business from cost-bases assets and liabilities to more market-oriented assets and liabilities drove the move towards increasing use of fair value accounting. Under the momentum, a measure like net income

Since 2002, Financial Accounting Standards Board (FASB) and International Accounting Standards Board’s (IASB) have been working toward “convergence” of US General Accepted Accounting Principles (GAAP) and International Financial Reporting Standards (IFRS). They have made significant progress in efforts to converge critical accounting standards such as those dealing with revenue recognition, financial instruments and leases. Once these projects are complete, the "era" of convergence will be at an end. Nevertheless, the benefits for investors of eventually getting to consistently applied, high-quality, globally accepted accounting

The documents that comprise GAAP vary in format, completeness, and structure. As a result, financial statement preparers sometimes are not sure whether they have the right GAAP; determining what is authoritative and what is not becomes difficult. In response to these concerns, the FASB developed the Financial Accounting Standards Board Accounting Standards Codification. The FASB’s primary goal in developing the Codification is to provide in one place all the authoritative literature related to a particular topic. Professional accountants pay for access to the FASB. The OU Accounting Department has paid for academic access to the FASB Codification. Our Login information is:

The IFRS are described like founded on principles, which means that they leave a big freedom of action to the companies about the evaluation of the accounting data. The US GAAP are described like founded on rules and they aim to regulate all the possible aspects of the presentation of the accounts. These standards thus require very detailed information on behalf of the companies. In the case of convergence between IASB and FASB, the harmonization of the IFRS and US GAAP is currently working and common solutions have already been found. That do not prevent from the divergence of several points of view, among the principal aspects to be solved one we think about the financial instruments and the presentation of the performances.

IFRS 13 determines the extent to which subjectivity can be applied in the measurement of assets using fair value. The standard states the guidelines that should be followed in determining the value of the long-term assets in an active market (Gary John Previts, 2011).

FASB implemented FAS 157 because of prior standards having different definitions of fair value and limited guidance for

The FASB Accounting Standards Codification (ASC) 320-10-15-5a states that topic 320-10 applies to investments in equity securities that have readily determinable fair values, therefore

While generally accepted accounting principles include wide guidelines of general application, the standards also include comprehensive practices and procedures that offer the standard for evaluating financial presentations. As a result, these principles in financial recording and reporting tend to imply a substantial and significant authoritative support. Notably, GAAP standards are not a series of specific tailor-made guidelines that can be easily accessible in a single convenient range of rules. This is primarily because they originate from several sources and within a developed hierarchy. Generally, the standards range from the guidelines established by the Financial Accounting Standards Board, financial reporting literature from the AIPCA, and some financial

IFRS 8-1: What are some steps taken by both the FASB and IASB to move to fair value measurement for financial instruments? In what ways have some of the approaches differed?

IFRS 13 provides a principles-based framework for measuring fair value in IFRS. This is based on a number of key concepts including unit of account; exit price; valuation premise; highest and best use; principal market; market participant assumptions and the fair value hierarchy. Fair value is an important measurement on the basis of financial reporting. It provides information about what an entity might realize if it sold an asset or might pay to transfer a liability. In recent years, the use of fair value as a measurement basis for financial reporting has been expanded. Determining fair value often requires a variety of assumptions as well as significant judgment. Thus, investors desire timely and

ACC307 INDIVIDUAL ASSIGNMENT TASK 1: Contemporary Issues of Accounting Theory Fair Value Measurement Overview After the International Accounting Standards Board (IASB) released the IFRS 13 Fair Value Measurement in May 2011 for the purpose of completing its joint project with the US Financial Accounting Standards Board (FASB) on fair value, the Australian Accounting Standard Board (AASB) released the Australian equivalent - AASB 13 Fair Value Measurement in the September of the same year. This standard permitted early adoption but generally started to take effect for the financial reporting periods beginning from 1 January 2013. This new standard requires no new requirement for the adoption and but it was accompanied with the issuing of AASB 2011-8 Amendments to Australian Accounting Standards arising from the AASB 13 which has made consequential changes to 32 standards and 9 interpretations for the adoption in Australia. The new standard attempts to unify IFRS and US GAAP by specifying how entities should apply the fair value measurements that applied in previous IFRS standards. It clarifies and redefines fair value as “the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date”, sometimes referred to as an “exit price”. It also sets out a single source guidance for a robust measurement framework to ensure that the requirements are applied consistently and have clear

INTRODUCTION Since the promulgation of fair value accounting by the International Accounting Standards Board (IASB), the subject matter has been hotly debated by industry players and professionals of the accounting fraternity the world over. Many problems and pitfalls have been highlighted on the "mark-to-market" premise. For example, David Gwilliam and Richard H.G. Jackson (2008) noted that Enron "was able to 'monetize' physical assets so as to bring them within the remit of mark to market accounting", suggesting misuse of fair value measurement. Fair value is said to be superior to other forms of measurement because it is easily

The accounting standards released in recent years shown a movement from HC to Fair value. Historical cost was the dominant method used to measure assets and liabilities in financial reporting. While many accounting standards are using now fair value measurement. Historical cost is simple and cheapest way to measure. But it has many limitations like it ignores inflation problem. The changing business environment required change, so fair value is considered to be more reliable than HC in many cases. What we shall see that fair value is appeared to be the preferred measurement base of IASB, although

According to Mary E. Barth (2007), an analysis regarding the latest activities of the International Accounting Standard Board (IASB) have revealed that the use of fair value as a measurement base in financial accounting is probable to increase. With the increased probability of using fair value as a measurement base and the adoption of international accounting standards by Australia, it