Maa 725

4100 Words17 Pages
| MAA 725 | Advanced Accounting Principles and Practice | | Dr. Li Liu | Unit Chair | Group 4 Chesten Anne G. Beloso – 212342256 Xiaohan Liu - 211640339 Cuanling Wei - 212120435 “We certify that the attached work is entirely our own, except where material quoted or paraphrased is acknowledged in the text. We also declare that it has not been submitted for assessment in another unit or course.” 06 May 2013 Number of words: 3,943 INTRODUCTION This assignment aims to present in a clear and concise manner our viewpoint towards remuneration disclosure, considering steps to improve this matter of contention is taken voluntarily by the boards as recently stated by The Australian Financial Review. Section I explains…show more content…
* An attempt to be an accountable or responsible company by reporting information voluntarily. Managers are likely to consider that stakeholders have a right to certain information, and that they should fulfil that entitlement despite the related costs (Donaldson and Preston, 1995). Analysis This paper provides an overview of the current debate and the theories that attempt to explain executive remuneration disclosure. Attention is given to underlying accounting theories such as Positive Accounting Theory, Normative Accounting Theory, Stakeholder Theory, Legitimacy Theory, Institutional Theory, Public Interest Theory, Capture Theory and Economic Interest Group Theory. We will now analyse motivations to improve remuneration disclosure using the theories of financial accounting. Accounting theories typically either explain or predict accounting practice or they stipulate unambiguous accounting practice. Positive Accounting Theory (PAT) aims to make good predictions of actual world events and convert them to accounting transactions. Its general objective is to understand and predict the choice of accounting policies across conflicting firms. It recognises that economic consequences exist. In relation to PAT, because there is a need to be efficient, the firm will want to minimise costs associated with the performance indicators used by the firm. PAT uses hypotheses around

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