Advanced Accounting Theory & Practice Essay Example | Topics and Well Written Essays - 2000 words

advance Accounting Theory & Practice - Essay ExampleSince then, more and more countries atomic number 18 adopting IFRS.1 IASB sets down story standards for the accounting policies that a order under IFRS must follow. These accounting standards are in accordance with the requirements of conceptual Framework which assist users of pecuniary statements to take various financial decisions. IASB are in continuous feat to improve the accounting standards in order to prevent creative accounting practices by companies and help representing the current and fair view about the financial conditions and performance of the companies. IAS 1 which sets out guidelines regarding presentation of financial statements, its primeval features, changes in its recent revision by IASB, and finally criticism with regards to these changes, all have been covered in this study. Effects of changes in IAS 1 on Coca poop Co. have also been studied. Key Features of IAS 1 Objective IAS 1 sets the guidelines t o be followed in the presentation of financial statements do by an organisation. The presentation is made for the purpose of comparability with the companys financial statements related to preceding periods. It also ensures that the financial statements of the company can be compared with other line of descent entities as well. IAS 1 includes comprehensive requirements about how the financial statements are presented, rules about what would be its structure and the minimum requirements about what its contents will include.... cial statements are presented, rules about what would be its structure and the minimum requirements about what its contents will include.2 Scope IAS 1 is applicable to all the financial statements which are made for general purposes and is in accordance with International fiscal Reporting Standards (IFRS). Financial statements apply for general purposes are prepared with the intention that it would be required by the person who do not require financial repor ts to be used by them to cater to some particular information requirement.3 Financial Statements and its Components According to IAS 1, financial statements comprises of the following five components 1. Balance Sheet It is a statement which depicts the financial slope of a business entity at the end of the period. 2. Income Statement It is a statement explaining the comprehensive income of a business entity at the end of the period. 3. Statement of Shareholders Equity It is a statement showing the increase or abate in equity of the business entity for the period. 4. Cash Flow Statement It is a statement showing the hard cash flows of the business entity for the noted period. 5. Notes It comprises of the accounting policies followed by the business entity in a summarised form. It also includes other instructive notes of the business entity.4 IAS 1 does not require a business entity to use the same titles of the financial statements as stated above. They can use other titles as we ll. If we look at the annual reports of Coca Cola Co. for the year ending on December 31, 2011, we can find that all these components of financial statements are mentioned. along with these there are other reports prepared by Coca Cola like, Report of Management, Report of item-by-item Registered Public Accounting Firm, etc. which