Universal Set of Principles in the Field of Accounting Essay

Introduction A principle is defined as a rule, or even an idea that forms the basis of deciding what is wrong and what is right in context to our actions. As opposed to principles, we all have our own personal practices and traditions, which determine our behavior in the society. These practices are determined from our culture, society, ancestors, experiences and religion etc. But since we live in a world where every person has their own set of practices and traditions, we cannot expect to live the way we want and this is where rules and principles come in. The very foundations of any principle are built upon its underlying morals, ethics and laws, which are expected to be accepted universally (Chippendale, 2001). A society may have its†¦show more content†¦The paper then evaluates International Accounting Standards Board’s (IASB) attempts to develop a conceptual framework and the current state. In the final section I will discuss and reflect upon the evidence presented to support the topic of this essay along with a conclusion of facts and ideas presented. The need for a conceptual framework As we can understand from above that one person’s principle cannot necessarily be another one’s too; there needs to be an independent body, which can produce universally acceptable principles to resolve matters systematically and uniformly. When we talk about the introduction of a universal set of principles in the field of accounting, it was the famous stock crash of 1929, which wreaked havoc in the financial markets around the globe and created a situation where the need for generally accepted accounting principles was felt the most! (Lawrence et al, 1993). The resulting economic downturn, which lasted until 1939, was one of the gravest depressions ever recorded in the history and a lack of universal accounting standards was blamed to be one of the reasons for over valuation of stocks and overtrading. Although the depression arose in the United States but output losses, deflation and job cuts were observed all over the globe (Romer, 2003). Between these times the acc ounting profession started to promote the idea of independent audits andShow MoreRelatedHow Ethics Is Important For Business Environment1563 Words   |  7 Pages Ethics is a system of moral principles and standards that direct us to the behavior that is acceptable from the society. It is a combination of our good habits, our duties that we should accomplish, and the impression we leave on others based on our behavior. Ethics lay the foundation for the ability to differentiate between what is right and wrong in a particular situation and how to deal with situations that do not have a clear course of action to follow. It is vital to study ethics to improveRead MoreIslamic Accounting: Critical Insight In Its Growth And1237 Words   |  5 PagesIslamic Accounting: Critical Insight in its Growth and Challenges The typical day of an Accountant probably seems excruciating to most people uninterested in this field. You prepare assets, liability, and capital account entries. You analyze financial actions and make suggestions for the company. You’re essentially going through account information all day. Now, just imagine doing all of this but incorporating religious laws into it. Sounds a lot more different than the latter. You now have a lotRead MoreHistory of the Relationship Between Fasb Iasb1633 Words   |  7 Pagesthe International Accounting Standards Board and the Financial Accounting Standard Board Accounting Theory Research 541 The History amp; Relationship of the International Accounting Standards Board and the Financial Accounting Standard Board The International Accounting Standards Board (IASB), and independent standard-setting body of the IFRS Foundation was created after the Financial Accounting Standards Board (FASB) to develop and establish universal accounting procedures and standardsRead MoreA Company Responsible For Marketing Music Recordings1096 Words   |  5 PagesQuestion 1: Sole traders- they run their business on their own, are personally responsible for it and can keep all of the business’s profits after they paid the taxes. Limited company- an organisation set up to run a business. It is responsible for everything it does. The profit it makes, minus the taxes, is owned by the company and can be shared. Every limited company has people or organisations that hold a share in it. Business partnership- in a partnership, all the business partners personallyRead MoreCorporate Disclosure and Financial Statements: a Brief History1706 Words   |  7 Pagesthe Companies (Consolidation) Act 1908. A provision was made for including a statement in the form of a balance sheet in the annual return to the Registrar of Companies. †¢In the United States, progress on corporate disclosure followed the standards set in England, until the early 1900s. As late as the 1920s many corporations still kept sales figures secret, some did not depreciate assets, failed to treat non-operating income consistently, did not separate retained earnings from paid-in capital andRead MoreData Into The Computerized System1683 Words   |  7 PagesName: Thi Ngoc Anh Nguyen Student ID: S71565 Set up and operate a computerized system FNSACC406 Assessment 3 Describe the steps to be taken prior to inputting the data into the computerized system and how you would go about implementing the new system. †¢ The steps to be taken prior to inputting the data into the computerized system: - The first step: you will need to set up your company in your accounting software system. Look for company tab. Then, you fill in your company name, your company addressRead MoreCorporate Fraud And The Effective Management Of Accounting And Finance Functions1679 Words   |  7 PagesIntroduction In a world full of financial corporate scandals, the effective management of accounting and finance functions is a vital undertaking in that these two areas have direct connections to ethics (Mele, Rosanas, Fontrodona, 2017, p. 609). Due to the occurrence of corporate fraud, these two areas are in need of ethical rules. According to Mele et al. Rules allow us to answer the question of whether or not a specific practice is acceptable in order to earn money. Rules will say thatRead MoreAdoption of Ifrs in Bulgaria1197 Words   |  5 Pagesmost developing economies in Europe. The IFRS are a set of standards which imply rules, methods and governance for reporting and interpreting financial data. The purpose of the IFRS is to develop a set of universal standards to be applied and comprehended worldwide, in order to achieve harmonization and standardization among reporting entities. Bulgaria was accepted as a member of the European Union on 1 of January 2007. A number of obligations set by the EU had to be completed in order for this toRead MoreCritical Review On Moral Reasoning3548 Words   |  15 Pagesinterrelationship of education, accountants and moral reasoning. The final section of the chapter presents the conceptual framework for the research. The focus of this chapter is to help in understanding the influences of moral reasoning on accountants and accounting students. An Introduction to Ethics The interpretation of ethics is a subjective matter, and this is mostly due to disparities about its understanding and implications in different societies, cultures and countries. The term ethics includes aRead MoreDiscuss How Management Theory and Practice Has Changed over Since the Early 1900’s1408 Words   |  6 Pagesthat before the classical approaches exist, there are some people to set up the foundations for the nature of management. Robert Owen, Charles Babbage and Henry P.Towne. Owen concerns for the working and living conditions of workers. Babbage builds the first practical mechanical calculator and a trial of modern computers, and suggested profit sharing. Towne call for studying management as a science and developed the principles of management. All of their ideas are still affecting the development