Real Effects of Governmental Accounting Standards: Evidence from GASB Statement No. 53 - Accounting and Financial Reporting for Derivative Instruments

The purpose of this study was to analyze the constraints in the implementation of Government Accounting Standards (SAP) based on the accrual basis as well as to analyze the efforts made to overcome the existing obstacles in the implementation of Government Accounting Standards (SAP) based on the accrual basis. The Indonesian Governmental Accounting Standards Committee (KSAP) has compiled the Government Accounting Standards (SAP) accrual established by Government Regulation Number. 64 of 2013 replacing by the Government Regulation Number 71 of 2010. With the enactment of Government Regulation No. 64 of 2013, the application of accrual-based government accounting standards already have a legal basis. The enactment of Government Regulation No. 64 Year 2013 on Government Accounting Standards (SAP) based on the accrual basis brought major changes in the financial reporting system in Indonesia, which is a change from Cash Basis Accrual Basis Full towards the recognition of government financial transactions. Health laboratory center for Makassar has implemented Cash to Accrual (CTA) in 2011 until 2013.Implemented government accounting standards (SAP) based on the accrual basis in the accrual-based financial statements in 2014 is a qualified opinion (WDP ) acquired by the Health laboratory center for Makassar on The Audit Board of The Republic Indonesia (BPK) audit report on the financial statements 2016 illustrate unmet reasonable levels of information presented for a particular item. From the research will be found two (2) factors; Regional Working Unit (SKPD) Health Laboratory Center for Makassar obstacles encountered in implementing accrual-based government accounting system (SAP), human resources financial managers, and human resource asset managers who often alternated. In this study, researchers found the effort / solution by the Health Laboratory Center for Makassar on obstacles in implementing accrual-based SAP in the preparation of financial statements, namely: education and training.

Download Full-text

Response to the GASB's Invitation to Comment on Revenue and Expense Recognition: Project No. 4-6I

Journal of Governmental & Nonprofit Accounting ◽

10.2308/ogna-52328 ◽

2018 ◽

Vol 7 (1) ◽

pp. 97-103

Author(s):

Dara Marshall ◽

Nancy Chun Feng; ◽

Mary L. Fischer; ◽

Renee Flasher; ◽

Amy Foshee Holmes; ◽

...

Keyword(s):

Decision Making ◽

Conceptual Framework ◽

Financial Reporting ◽

Task Force ◽

Accounting Standards ◽

Data Availability ◽

Future Research ◽

Comprehensive Model ◽

Governmental Accounting ◽

Subsequent Phase

ABSTRACT The objective of the Governmental Accounting Standards Board's (GASB) Revenue and Expense Recognition Project is to develop a comprehensive model for classification, recognition, and measurement of revenues and expenses for governmental entities. A conceptual framework would provide a basis for evaluating revenue and expense recognition, provide guidance regarding exchange and exchange-like transactions that have not been specifically addressed, and improve the consistency of financial reporting for decision making and the assessment of accountability. The GASB issued an Invitation to Comment (ITC No. 4-6I) in January 2018 to seek feedback regarding the classification and recognition of revenue and expense transactions, excluding the issue of measurement as it will be addressed in a subsequent phase of the project. The GASB proposed two models developed by a task force at an earlier stage in the project: an exchange/nonexchange model and a performance obligation/no performance obligation model. This commentary provides the response submitted to the GASB from the Accounting and Auditing Standards Committee of the Governmental and Nonprofit Accounting Section of the American Accounting Association. In addition, directions for future research are discussed. Data Availability: Details regarding the GASB project can be found on its website at: https://www.gasb.org/jsp/GASB/Document_C/DocumentPage?cid=1176169978401&acceptedDisclaimer=true

Download Full-text

Real Effects of Financial Reporting on Innovation: Evidence from Tax Law and Accounting Standards

The Accounting Review ◽

10.2308/tar-2018-0582 ◽

2021 ◽

Author(s):

Braden Williams ◽

Brian M. Williams

Keyword(s):

Financial Reporting ◽

Tax Policy ◽

Accounting Standards ◽

Tax Incentives ◽

Financial Accounting ◽

Short Term ◽

Fin 48 ◽

Real Effects ◽

Equity Compensation ◽

Innovative Output

This study examines whether financial accounting standards moderate the effectiveness of tax policy. Specifically, we examine whether myopic managers' focus on short-term financial reporting reduces the effectiveness of tax subsidies that incentivize innovation. We employ a novel setting, the issuance of Financial Interpretation No. 48 (FIN 48), which changed the financial reporting for some important, yet uncertain, tax incentives to innovate. For firms most affected by the standard change, we find evidence of reduced investment in innovation, reduced sensitivity of investment to tax incentives, and reduced future innovative output. Consistent with earnings myopia, we find the effect is more pronounced in firms with higher levels of transient institutional ownership and newly vesting equity compensation. These results indicate financial reporting myopia has real effects on innovation and can reduce tax policy effectiveness. The results further suggest that tax policymakers should consider both financial reporting and cash flow incentives in designing policy.

Download Full-text

Beyond Financial Reporting. Integrated Reporting and its determinants: Evidence from the context of European state-owned enterprises

FINANCIAL REPORTING ◽

10.3280/fr2019-002003 ◽

2019 ◽

pp. 43-72

Author(s):

Giuseppe Nicolò ◽

Gianluca Zanellato ◽

Francesca Manes-Rossi ◽

Adriana Tiron-Tudor

Keyword(s):

Financial Reporting ◽

Empirical Investigation ◽

Gender Diversity ◽

Accounting Standards ◽

International Accounting Standards ◽

Integrated Reporting ◽

Financial Reports ◽

The Public ◽

Explanatory Factors ◽

Board Gender Diversity

Integrated reporting (IR), which aims to overcome the limitations of both tradi-tional financial and stand-alone non-financial reports, has gained momentum as a single comprehensive tool merging financial and non-financial information. Initially conceived for private sector entities, IR is also establishing itself in the public sector context as a vehicle for transparency and accountability. This research offers an empirical investigation of IR practices in the State-Owned Enterprises (SOEs) context. More specifically, the paper investigates the levels of disclosure provided through IR by a sample of 34 European SOEs and explores the effects of potential explanatory factors. The results indicate a fair level of IR disclosure and a trend of reporting information already requested under international accounting standards. The findings also highlight that industry (basic materials and financials) and size positively influence the level of IR disclosure in a particularly strong way, while governance features (board size and board gender diversity) and the provision of external assurance do not exert any impact.

Download Full-text

First-time adoption of International Public Sector Accounting Standards by Russian universities: Practical aspects

International Accounting ◽

10.24891/ia.23.4.364 ◽

2020 ◽

Vol 23 (4) ◽

pp. 364-383

Author(s):

L.I. Kulikova ◽

I.I. Yakhin

Keyword(s):

Higher Education ◽

Public Sector ◽

Financial Reporting ◽

Higher Education Institutions ◽

Accounting Standards ◽

Educational Process ◽

Academic Excellence ◽

Public Sector Accounting ◽

First Time ◽

Russian Universities

Subject. This article examines the practice of first-time applying the International Public Sector Accounting Standards (IPSAS) by Russian higher education institutions. Objectives. The article aims to identify and address the problems associated with such application, and conduct a critical analysis of Russian universities' compliance with the requirements of the International Standards on their first-time adoption. Methods. For the study, we used observation, systematization, and a comparative analysis. Results. The article examines and describes the practical experience of the first-time use of IPSAS in the preparation of reporting by Russian educational institutions participating in the Russian Academic Excellence Project (5Top100 Project). It presents the results of the most typical reclassification adjustments of reporting items made by the universities when preparing their inductive statements of financial position as of the date of transition to IPSAS. Conclusions and Relevance. Most of the universities studied complied with the requirements of the IPSAS first-time adoption and provided comparative information in their first IPSAS financial reporting. The importance of the study is to justify the provision that financial reporting in accordance with IPSAS is appropriate to improve the international competitiveness of universities, which makes it possible to better reflect financial information on the activities of universities. The results of the study can be used in the practical activities of the Russian economy public sector organizations, and in the educational process of higher education institutions.

Download Full-text

The Adoption of Financial Accounting Standards for Small Medium Enterprises by Muslim Entrepreneurs

JABM JOURNAL of ACCOUNTING - BUSINESS & MANAGEMENT ◽

10.31966/jabminternational.v27i2.692 ◽

2020 ◽

Vol 27 (2) ◽

pp. 54

Author(s):

Muslichah Muslichah ◽

Sunarto Sunarto ◽

Anang Amir Kusnanto ◽

Sri Indrawati ◽

Hariyanto Hariyanto

Keyword(s):

Financial Reporting ◽

Quantitative Data ◽

Accounting Standards ◽

Financial Accounting ◽

Unexpected Finding ◽

Financial Reports ◽

Small Medium Enterprises ◽

Medium Enterprises ◽

Chartered Accountants ◽

Structured Questionnaire

This study aims to discuss the adoption of financial reporting and accounting standards for small-medium enterprises (SMEs) by Muslim entrepreneurs. A structured questionnaire was used to collect quantitative data from the SME owners. 214 Muslim owners of SME businesses participated in the survey. The results show that only a few Muslim entrepreneurs prepared financial reports regularly. The main reason for preparing the statement is for calculating tax, borrowing money, and decision making. An unexpected finding from this study is that most of the Muslim owners are unaware of Standard for SMEs. Users of SME financial reports include tax authority, banks, and owners, or shareholders. This study enriches the financial reporting studies by examining the accounting standards for SMEs in a Muslim dominated country. The findings of this study also have implications for the Institute of Indonesia chartered accountants (IICA) as standard setter. IICA must routinely disseminate these standards to SMEs and also assist them in preparing financial reports

Download Full-text

On the issue of assessing the adequacy of the reserves of insurance companies with various methods for determining the loss of business

Buhuchet v zdravoohranenii (Accounting in Healthcare) ◽

10.33920/med-17-2007-05 ◽

2020 ◽

pp. 46-53

Author(s):

Margarita Naslednikova ◽

Alexandr Zamalov

Keyword(s):

Comparative Analysis ◽

Health System ◽

Financial Reporting ◽

Accounting Standards ◽

Insurance Companies ◽

Insurance Company ◽

Reporting Standards ◽

Loss Ratio ◽

Qualitative Characteristic ◽

Financial Reporting Standards

The article discusses methods for calculating the loss ratio of insurance companies, including compulsory medical insurance, which is the basis for building a health system; suciency of formed reserves, which are created in connection with the possibility of losses. Variants of interpretation of calculated indicators into a qualitative characteristic of the insurance company. A comparative analysis of the calculation of indicators of loss-making of insurance companies and the adequacy of the formation of reserves of insurance companies according to Russian accounting standards and in accordance with the requirements of international financial reporting standards.

Download Full-text