Learn Accounting?

Posted on | August 7, 2010 | No Comments

How many ways can you learn accounting?

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Read the ‘learn accounting‘ page and tell us how many ways there are to learn accounting!

Deferred taxes

Posted on | August 4, 2010 | No Comments

SEC: Securities Exchange Commission

Posted on | July 20, 2010 | No Comments

The U.S Securities Exchange Commission is the federal body governing financial accounting securities and exchange in the USA.

SEC functions with an aim to safeguard the financial accounting sector by maintaining order and keeping the investors educated and well informed about the securities market. SEC seeks to promote capital formation as it is essential to sustain economic growth.

SEC follows a simple rule to govern the securities industry via a simple concept: all investors, irrespective of the kind, should have access to certain basic facts regarding an investment before purchasing it, and so long as they own it. For the same, SEC makes sure that companies provide financial and other meaningful data to the public. This enables the public to have a common pool of information regarding the different investment opportunities in the market and decide for themselves on what could be the right choice.

SEC inspects the key players in the securities world (securities exchanges, securities brokers and dealers, investment advisors, and mutual funds) regularly to avoid frauds.

Among other responsibilities SEC is assigned to interpret the federal securities law, amend existing rules, create new rules, oversee securities firm, brokers, investment advisers, and ratings agencies, oversee private regulatory organizations in the securities, accounting, and auditing fields and coordinate U.S. securities regulation with federal, state, and foreign authorities

For more information on SEC’s mission, functionality, structure please refer to

Links Used: http://www.sec.gov/

PCAOB: Public Company Accounting Oversight Board

Posted on | July 12, 2010 | No Comments

PCAOB stands for Public Company Accounting Oversight Board. It was founded as per the Sarbanes – Oxley Act – 2002.

PCAOB works with the mission to oversee the auditors working in public companies, making sure that that audit reports prepared by them are informative, fair and informative. PCAOB makes sure that the audit reports are standardized and of public interest.

The members of PCAOB are appointed by the SEC (Securities and Exchange Commission).

The headquarters of PCAOB is located in Washington D.C. However there are regional offices across the United States.

Please visit the official website for more information on PCAOB and its functions, members etc: http://www.pcaobus.org/

MD&A: Management Discussion and Analysis

Posted on | July 8, 2010 | No Comments

MD& A – Management Discussion and Analysis one part of a company’s annual report. In this section the management discusses various aspects of the company. This space has no restriction on time span. Both past and present day aspects of the company are discussed and analyzed intensively.

In other words the management of a company discusses all aspects of the company such as the previous year of operations of the company, its success rate etc. They even discuss about the future by drawing an outline of its future plans.

To an investor, this section is of great interest as it helps in analyzing the working of the company in close detail. However it should be noted that MD&A part of the annual report is not audited.

IIA: Institute of Internal Auditors is the national association

Posted on | July 4, 2010 | No Comments

IIA stands for Institute of Internal Auditors is the national association. It is a national association consisting of accountants. These accountants are those who are engaged in internal auditing and are employed by business firms

The mission of The Institute of Internal Auditors is to provide dynamic leadership for the global profession of internal auditing. Activities in support of this mission will include, but will not be limited to:

• Advocating and promoting the value that internal audit professionals add to their organizations;
• Providing comprehensive professional educational and development opportunities; standards and other professional practice guidance; and certification programs;
• Researching, disseminating, and promoting to practitioners and stakeholders knowledge concerning internal auditing and its appropriate role in control, risk management, and governance;
• Educating practitioners and other relevant audiences on best practices in internal auditing; and
• Bringing together internal auditors from all countries to share information and experiences.

IIA conducts and evaluates a comprehensive professional examination which on passing certifies the accountant as a CIA (Certified Internal Auditor)

IIA was founded in 1941 and the global headquarters is in Altamonte Springs, USA

Further details on IIA can be obtained by clicking on the following link: http://www.theiia.org/theiia/about-the-institute/

IFRS: International Financial Reporting Standards

Posted on | June 29, 2010 | No Comments

International Financial Reporting Standards (IFRS) are a set of standards that describe the manner in which data should be reported in a financial statement. Each transaction and each type of event should be reported in a financial statement as per the guidelines of IFRS

IFRS was coined with a great mission in place by the IASB. It is of great significance accounts and auditors and the general public as it makes international comparisons very simple.

IFRS was formerly known as IRS-International Accounting Standards. To be more precise IFRS was IAS between 1973 and 2001.

For more details on IFRS please click on the following URL: http://www.iasb.org/IFRSs/IFRs.htm

IFRIC: International Financial Reporting Interpretations Committee

Posted on | June 25, 2010 | No Comments

IFRIC stands for International Financial Reporting Interpretations Committee.

International Financial Reporting Interpretations Committee functions as the interpretative body of IASB (International Accounting Standards Board). It has the authority is interpret IAS (International Auditing Standards) and IFRS (International Financial Reporting Standards) however it should be approved by the IASB before publishing as an official document.

The IFRS Interpretations Committee (IFRIC) interprets the application of International Financial Reporting Standards (IFRSs) and provides timely guidance on financial reporting issues not specifically addressed in IFRSs or IASs, in the context of the IASB’s framework, and undertakes other tasks at the request of the Board. IFRIC publishes draft Interpretations for public comment and considers comments made before finalising an Interpretation. When the IFRIC has reached a consensus on a final Interpretation, the Interpretation is submitted to the IASB Board for approval.

The IFRIC has 14 members appointed by the Trustees for terms of three years. IFRIC members are not salaried but their expenses are reimbursed. IFRIC meets approximately every other month at meetings that are open to public observation and are webcast. Approval of Draft or final Interpretations requires that not more than four voting members vote against the draft or final Interpretation. IFRIC is chaired by a non-voting chair.

IFRIC is situated in London. IFRIC replaced the former Standing Interpretations Committee (SIC) in March 2002

IFAC: International Federation of Accountants is a federation

Posted on | June 20, 2010 | No Comments

International Federation of Accountants is a federation is commonly known as IFAC. It is a federation of almost all national professional accounting bodies around the world. IFAC’s committees formulate standards in auditing, education, ethics and the public sector financial reporting.

IFAC, in its own interest guides and supports professional accountants in business, small and medium practices, and developing nations in their profession.

IFAC functions with the mission to ‘serve the public interest, continue to strengthen the worldwide accountancy profession and contribute to the development of strong international economies by establishing and promoting adherence to high-quality professional standards, furthering the international convergence of such standards and speaking out on public interest issues where the profession’s expertise is most relevant’

For more details on IFAC’s structure, mission, members etc please visit their official website: http://www.ifac.org/

GAAS: Generally Accepted Auditing Standards

Posted on | June 14, 2010 | No Comments

Generally Accepted Auditing Standards is an organized set of standards put together by the American Institute of Certified Public Accountants to maintain consistency in auditing done by all auditors. Auditors perform audits on company finances as per the guidelines mentioned in GAAS. It ensures that the work is consistent and verifiable

GAAS are categorized into three main sections, namely ‘General standards’, ‘Standards of fieldwork’ and ‘Standards of reporting’.

Each section is littered with requirements that the auditor and the subject company must meet. In short, an auditor must adequately plan the audit in advance, be independent of the client at all times, and always obtain reliable evidence. The companies must present their financial statements in accordance with GAAP, remain consistent in their reporting, and explicitly disclose all pertinent information.

AICPA developed GAAS in 1947 and has gone through minor changes over the years.

For a detailed description of GAAS please follow the link:

http://www.aicpa.org/download/members/div/auditstd/au-00150.pdf