Kevin Stevenson retires as AASB Chair Essay

This article is precautioned with the accomplishments and achievements of Kevin Stevenson upon his retirement as the Chairman of the Australian invoice exemplifications Board on 30th June 2014. During his tenure, Kevin Stevenson ensured that the long traditions of fiscal reportage were upheld both internationally and domestically and also provided counsel on military issues concerning the FRC. Mr. Stevenson was an example of pioneer standard setters for generations down the withdraw as he was among the founding members of the Accounting Standards Advisory Forum of the International Accounting Standards Board. Through his leadership, the AASBs Research Centre was established as Stevenson served the Asian-Oceanian Standard Setters Groups chair. His main focus was to work in the interest of the public, as stated by Lynn Wood, the FRCs chair and trustee of the IFRS Foundation. In unanimity is Ian Mackintosh, the former Chair of the PSASB of Australia and Deputy Chair of IASB. Accor ding to Mackintosh, Stevenson largely contributed in the moves by Asia countries like Nepal and Korea to the IFRS. From the onset of the 1970s, Mr. Stevenson attention was driven towards setting principal found standards and developing a Conceptual Framework to be used in financial reporting. He advocated for story regulations as evidenced by his association with the Accounting Research Foundation and later on watched over the growth of the AARF upon being appointed its Director. He was at the forefront of setting the international pace in the development of common story standards for both the public and the private sectors. Stevenson largely contributed to the formation of the Public Sector Accounting and also played a noteworthy role in the establishment of the stable platform of International Financial reportage Standards in 2005 for adoption in Australia and the entire Europe.Concepts, ideas and facts Teamwork and leadership atomic number 18 both important component s that must be in alignment so as to provide effective high quality and efficient business relationship services. A strategical human resource management model provides guidance to accounting teams and leaders to deliver high-quality services in a by the way manner. Accounting operates within a performance measurement that tolerates no errors. Therefore, a state-of-the-art investigation requires scientific leadership working with major stakeholders as a team to provide the trounce accounting services to a fraud investigation. The new techniques of accounting be significant steps in the overcompensate direction and they require leaders with skills and origin tools to apply concepts such as efficiency, cost benefit analysis, economies of scale and cost-effectiveness analysis that will measure continuous improvement on a regular basis. good leadership is needed to develop, design and implement a solution that would resolve the core competency of an organization. Strategic leade rship in accounting provides quality and timely accounting services to a company. Such leadership like that o Stevenson brings together a come apart system consisting of thousands of accountants working within a fragmented system of organizations. Effective teamwork and leadership in accounting shows the way through the development of new innovative fraud investigations for the future. Leaders in positions like that of Stevenson are encouraged to consider both the social and moral implications of their decisions with regard to how their decisions will affect the clients and shareholders of the company. It is the ethical responsibility of every employee to ensure their company does not illegally evade income taxes or allow questionable deductions. They should ensure that the company finds are allocated to the appropriate activities based on their importance and determine the important elements of the business.The accounting issue One major way of improving the confidence in f inancial reporting and accounting is to ensure that there is improvement in ethical standards, reporting mechanisms, strengthening of governance and adequacy of financial management. It is ethical to maintain the right to the truth while practicing accounting and financial reporting. Those who use financial statements charter the right to accurate and truthful information when engaging in investment strategies. Clients have a legal right to receive competent and professional services from accountants who have a legal obligation to perform their responsibilities within the constraints of their skills. It is often argued that about accountants lack ethical ability to recognize and solve ethical dilemmas. This has necessitated the need to accommodate ethics education as a major component of the accounting profession. The development of professional ethics and values should be initiated early in the accounting profession and be emphasized throughout the career.Major issue of the arti cle Stevenson clearly shows that it is the responsibility of management to serve the best interests of the company that they are providing auditing and accounting services for, investors and society as a whole. This can be done by providing truthful and accurate financial records. Ethical guidelines require that management should be honest, concise, accurate and complete while recording financial data to ensure ethics are held to the highest degree. It is also the duty of every employee to make wise, informed decisions slightly the future of a company. These accounting standards are useful in financial reporting and accounting as they are operatees that are currently under a great deal of scrutiny. The two are important functions that organizations should take care of and ensure that they exhibit a high code of ethics. This is because clients and shareholders use accounting and financial reports in their decision making process. Legal and ethical issues are important element s of financial reporting and accounting as has been demonstrated by the positions assumed by Mr. Stevenson. These issues prompted Stevenson to establish financial reporting and accounting departments to set up specific sets of rules that govern the functioning of any organization.Relevant topics and theories The long traditions of financial reporting utilize Positive Accounting theory by focusing on various aspects that are of major interest to accounting techniques and the issues that provided an informative background and the gives in discernment details of the functionality of accounting in financial reporting. Positive Accounting gives a holistic description of what is currently unknown and proposes future considerations. Financial reporting and accounting apply to any economic entity relating to the companys future business. The major ethical elements involved are objectivity, competence, independence and integrity. These ethical elements require that accountants and fi nancial reporters are independent of the clients to whom they provide financial and accounting services. Ethical obligations help to determine the effectiveness of accounting and financial report and redress any imbalance that may alter information symmetry. The move by Nepal and Korea followed the ethical guidelines of financial reporting and never let the desire for a better living and acquiring more(prenominal) possession get in the way of their financial obligations. It is ethical for any employee of the accounting or financial department working in the public or private sector to remain loyal and impartial to ethical obligations when reviewing both individual and financial reports. It is usual for one to encounter various ethical issues and it is consequently important for one to remain vigilant to resist temptations to control financial records that could violate ethical guidelines. Transparency and integrity are important ethical elements of prescriptive accounting theory . Some companies may receive pressure from management to maintain a certain public image. This is because some public companies have the burden of succeed at high levels and it becomes an ethical issue for them to maintain true reports of the company assets, profits and liabilities without succumbing to the pressure from management. It is unethical for management to alter the financial records of its company and manipulate the numbers to create a false image of the success of the company. This only leads to prosperity in the short term since such fraud cases are ascertained by the Securities and Ex commute Commission ultimately spelling the downfall of the company. For these reasons, accounting theories assert that companies must remain ethically vigilant to avoid breaching the code of conduct. tall standards of ethical behavior are expected for those people engaging in accounting and financial reporting. These standards provide rules and guidance to employees in the performance of their professional obligations. forgetful decision making by management based on faulty or manipulated financial records aimed at deceiving the public about a companys financial health has negative consequences on the business. It is therefore unethical for management to overlook such behavior. Given how tempting it is for companies to manipulate their financial records in order of battle to portray an image of economic health, management should provide the last defense possible to prevent accounting fraud.In comment letter 1, the Financial Reporting Committee of the IMA wrote to express its views on financial accounting standards on reduction of the income statement presentation through the elimination of the concept of extraordinary items. The FRC is in name of several accounting books of different companies this in essence means that they are charged with the responsibility of making timely responses to statements, pronouncements, research legislations, proposals and pending legislations. Their main concern in this letter is the complex nature of financial statements in FASB comment letters. They support the simplication possible action adopted by the board as regards to making the financial statements easier to understand by the common folk CITATION Sch l 1033 (Schroder, 2014). Their support is on the elimination of elimination of extra ordinary items as in most times this criterion is not always met.Their proposal thus rids of the tedious work in the preparation of financial documents and whether this requirement is met by auditors in the process of doing their work. Their support is based on the fact that it reduces to a great extending the complex nature of the time for the allocation of the provision of income tax by reducing the situation of other income items occurring. They thus advocate for a thorough examination of the details of this suggested proposal CITATION Sch l 1033 (Schroder, 2014).In comment letter number 2, Marcum Accountants and Advisors frame to the FASB regarding the proposed accounting standards through the simplification of the income statement by elimination of the concept of extraordinary items. Their letter is generally a response to several questions regarding the process of simplification of the income statement. They support the concept of elimination of extra ordinary items from the General Accounting principles. Their contention is based on the difficulty of application the extra ordinary items in accounting practice CITATION Giu14 l 1033 (Giugliano, 2014). They thus support the application for extra ordinary items in previous accounting periods. A sudden change of the rules would otherwise lead to confusion in the accounting practice. The ease of application of the proposed update makes it easy to make these recommended changes quite easy to adopt. They thus suggest the quick adoption of the proposed update.They are in agreement with the decision by the board to stick to the principle of sepa rate disclosure of infrequent transactions. Items must thus butt against the definition of occurring infrequently in recurrent expenditure. They list the following examples as those that should not be classified as unusual or infrequently occurring line of work related expense, routine tax audit returns and losses and gains from reimbursements from insurance CITATION Giu14 l 1033 (Giugliano, 2014). They thus suggest the importance of offering guidance on the design of unusual items. Proper definitions should thus be provided of the unusually occurring items.In comment letter 3, Ford Motor Company also writes in support of the simplication initiative by FASB. Their agreement is based on the objective of evaluation, identification and improvement of the generally accepted accounting principles CITATION Cal14 l 1033 (Callahan, 2014). This thus means that the reduction of the cost of complexity is possible with the simplification of the income statement. They are also in agreement wi th the board that such an update would not lead to data loss. The overall benefit would be to the end users of such financial statements.ReferencesCallahan, S. (2014). Ford Company.Giugliano, G. (2014). Marcum Accountants.Schroder, N. (2014). Institute of Management Accounting.Source document