基础会计Lesson 9

Lesson11UnderstandingAccountingPrinciples1SchoolofManagementHUST2OutlinesŠAccountingstandards:atoolfortrustingŠIntroductionofAccountingStandardsŠAccountingStandardsinChinaŠABriefofAccountingTheory2SchoolofManagementHUST3OpeningStoryŠEnronscandalagain!„Filed8-KtorestateitsfinancialstatementsinNovember8,2001;„FiledbankruptcyprotectionunderChapter11inDecember3,2001;„Mr.Berardino,thenCEOofAndersen,issuedanannouncement:Enron,awakeupcall;zAccountingstandardsisthefirsttobeblamed;3SchoolofManagementHUST4OpeningStoryŠThestandardsinvolvedinEnroncase;„Specialpurposeentity(SPE);„FASBonSPE;z3%independentinterest;zAssumesubstantiallytherisk;„EnronandAndersen:stickto3%requirement,ignoringtheriskassessmentrequirement;ŠAccountingStandardsorstandardsenforcement?4SchoolofManagementHUST5§2.1TheValueofAccountingStandard-AccountingandTrustŠHowcouldaccountinghelptodeveloptrust?„Translateallbusinessactivitiesintonumericsoitcouldbesummarized,measuredandevaluated;„Managersmayreportanddischargetheiraccountability;zPrincipal-agentproblem;ŠSinceallcommoninvestorsareprincipals;„Free-riderissuesarepervasive;„Howtoassuremanagerstoprovidefinancialreporttruthfullyandreliably?5SchoolofManagementHUST6AccountingandTrustŠArefinancialreportsreliableandobjective?„Theinherentlimitationoffinancialaccounting;zMonetarymeasurement:pennywiseandpoundfoolish;ŠWheretoputBillGatesonMicrosoft’sFinancialStatements?zHistoricalcost,accrualbasis,periodicreport:ŠFinancialreportingarelagged,nomattergoodnewsorbadnews;6SchoolofManagementHUST7AccountingandTrust„Beaware:allmanagers,includingaccountants,areREMMs;Resourceful,Evaluator,MaximizerModelzAccountingcomesdowntothe-vehicle-for-bank-robbers;zAlltheblamestoaccountingforits“uniquerole”inYinguangxia,Enron,WorldCom,etc.7SchoolofManagementHUST8AccountingandTrustŠToassurethereliabilityofaccountinginformation,manymechanismaredevisedandemployed;„Periodicandtimelydisclosure;„Fulldisclosure;„Accountingstandards:zWhygenerallyaccepted?„Auditing:zAdditionaltooltoassurethereliabilityofaccountinginformation.8SchoolofManagementHUST9AccountingStandards:aTrustPerspectiveŠREMMspushthelinesashardaspossible;ŠExecutiveswillabuseaccountingnumbersgiventhatthesenumbersareessentialintheirperformanceevaluation;„Incentivetomanageandmanipulateearnings.9SchoolofManagementHUST10OpendiscussionŠRevenuerecognitioncriteria:¾Earnedprocessdone,considerationsguaranteed;ŠHowtoaccountfor¾Sellandrepurchasetransactions?¾Sellandlease-backtransactions?10SchoolofManagementHUST11Opendiscussion¾Conclusion:forsellandrepurchasetransactions,therevenuerecognitioncriteriasatisfied;Buttheyarefinancinginsubstance.)Substanceoverform.11SchoolofManagementHUST12AccountingStandards:aTrustPerspectiveŠInordertosolvethedisputesonaccountingchoices,agreementonthesetofaccountingchoicesisnecessary;¾Wedefinethisasaccountingstandards;¾ItisalsonamedasGAAPinUS;12SchoolofManagementHUST13§2.2IntroductionofAccountingStandardsŠVariedterms„Accountingnorms;„Accountingprinciples;„Accountingstandards;„GAAP;„InternationalAccountingStandards,„Financialreportingstandards;„…ŠFocusonsubstance,notform;13SchoolofManagementHUST14IntroductionofAccountingStandardsŠAccountingstandards:¾Mustbeauthoritativelysupported;¾Otherwise,nobindingeffect;ŠTwowaystogainauthoritativesupport;¾AuthoritativenessfromGovernmentaladministration;ƒMinistryofFinanceactingasstandardssetter;¾Widelyrepresentedtogainauthoritativeness;„ThisisthecaseofFASBbefore2002;„PCAOB,aquasi-governmentalagency,steppedinafter2002.14SchoolofManagementHUST15IntroductionofAccountingStandardsGAAPisasetofstandardsandrulesrecognizedasageneralguideforfinancialreportingsupportedby:SECMandatesGAAPFASBDevelopsGAAPCollaborate15SchoolofManagementHUST16IntroductionofAccountingStandardsŠAccountingstandardsmustbeeffectiveinresolvingdisputes;ŠStilltwowaystoreducedisputes;„Focuson“scientific”principlestoguide;„Furnishwithcooking-booksolutions;„Thisisthestoryofprinciple-basedandrule-based.16SchoolofManagementHUST17IntroductionofAccountingStandardsŠAccountingstandardsinChina¾AccountingLaw,2000;¾RegulationsforBusinessFinancialReporting,StateCouncil,2000;¾BusinessAccountingStandards,MinistryofFinance;ƒNewstandardswillbeexpected;¾UnifiedAccountingSystems,MinistryofFinance,2001;¾Temporaryexplanations;17SchoolofManagementHUST18IntroductionofAccountingStandardsŠCSRCanditsroleinregulatingpubliccompanies’accountingpractice;¾Twosetsofregulations;„Informationdisclosureonformsandcontents;„Rulesforinformationdisclosure;¾Actuallyaffectpubliccompanies’accountingpractice;„ThechangeofrulesonNon-recurringgainsandlosses;18SchoolofManagementHUST19IntroductionofAccountingStandardsŠAccountingstandardsitselfisinthestateofkeep-changing;¾TheearlystageofA/S,easyandsimple;„ThefirstbatchofA/Sonlyincludes6itemswhenapprovedbyAIAandNYSECin1933;¾Morecomplicated;„154statementspublishedbyFASBastoMay2005;19SchoolofManagementHUST20IntroductionofAccountingStandardsŠAccountingStandardsEvolutioninChina¾After1949,wekilledallthemarket;„Everythingisundercentralplanning;zWeplannedeverything,includin