Stewardship versus economic decision making in financial reporting

Stewardship versus economic decision making in financial reporting The main objective of financial reporting according to the IASBs Preparation and Presentation of Financial Statements framework is that of providing adequate information in order to enable shareholders conduct economic decision making. This brought the debate of whether such objective neglected the importance of the stewardship assessment by the part of shareholders. In the past decade the IASB and the US FASB have been working on a joint project to develop a conceptual framework for financial reporting. Such conceptual framework has the aim of providing a base for developing harmonised, future accounting standards. In 2008, the boards issued an exposure draft of chapter one and chapter two of the conceptual framework with chapter one tackling the objectives of financial reporting. In the exposure draft that has been lately issued by the two boards, it was identified that the objective of financial reporting should be that of catering for all the decisions that capital providers make, including both resource allocation decisions and decisions made to protect and enhance their investments. Furthermore on the underlying exposure draft there is stated that information about the stewardship of an entitys economic resources should be considered as decision-useful information. Hence in this exposure draft it is clear that the two boards shifted from focusing solely on economic decision making, to general decision making, with stewardship being included in such broader definition. Although this move to focus on decision usefulness rather than specifically on economic decision making was a means to subsume stewardship in the objective of financial reporting, authors such as Andrew Lennard still argue that stewardship and decision usefulness should be recognised as separate objectives. à ¢Ã¢â€š ¬Ã‚ ¦stewardship contributes an important dimension to financial reporting, which should be reflected by specific acknowledgement in the objectives of financial reporting.  [1]   The majority of the authors who recognise stewardship as a fundamental objective in financial reporting, claim that financial statements should be prepared on the basis of historical costs. This ensures in providing a clear, factual account of the transactions that occurred during the year, over which management had control. Thus reporting on historical cost can aid shareholders accomplish their stewardship assessment needs better. On the other hand, to cater for decision usefulness, especially in terms of economic decision making, financial reporting would focus more on the forecasting of future cash flows. Such objective would be better addressed with valuations based on market values, since they better reflect the timing and certainty of future cash flows. This is leading to the emergence of valuation techniques based on current values, such as fair value. The adoption of fair value accounting is perhaps one of the most controversial issues currently being faced by the accountancy world. Both the IASB and the FASB have been working on this issue for the last couple years. Traditionally, financial reporting has been exclusively based on historical costs. The use of current values, such as fair value reporting emerged relatively recently, and was applied to only few selected areas. One of the areas where fair value had a major influence is in the measurement of financial instrument. Using market values to value Financial Instruments is deemed to be reliable (since markets in these items are well developed) and relevant (because the values of financial instruments can experience large fluctuations, thus historical costs depicts a very poor picture of current values). However, in the nearby future, fair value measurement is likely to be extended to other assets, especially in the light of the fact of the IASBs and FASBs perceived preferenc e for fair value measurement even where the market is not well developed. The IASB believes that fair value measurement under IFRS and GAAP is already consistent. Also, the IASB and the FASB will continue to work together to ensure that applying fair value in an inactive market is accounted for consistently  [2]  . Shareholders are divided into two main categories, private individuals and institutional investors. Although financial reporting is designed to cater for the needs of capital providers, due to the lack of knowledge commonly found within private individual shareholders, concerns may arise on what such private individual shareholders identify as useful, for their decision making. Need for the study: The dissertations objective is to identify the current needs of private shareholders and what they identify as valuable information. The dissertation shall then examine to what extent the focus on decision usefulness and the forecasting of future cash flows through fair value accounting shall aid private shareholders in satisfying their requirements. Research Methodology: The dissertation will be of a qualitative nature. The aim of such dissertation is to achieve a deep understanding of what local private shareholders value as relevant information, and to examine whether the emerging concept of fair value accounting will be providing such users more relevant accounting information. The aim of the study is not to generalise findings but to obtain rich description on the underlying topic. The method being taken into consideration to gather the qualitative data is the setting up of focus groups with shareholders. Such group discussions provide direct evidence about similarities and differences in participants opinions. Participants are not required to answer for every question enabling them to build on one anothers response. Furthermore by acting as a moderator I can ensure that the discussion is always kept on track. Finally, focus groups can be considered as a more plausible solution when compared to open ended interviews with shareholders. The response rate of shareholders to a focus group is likely to be greater when compared to a personal one on one interview, since the latter is perceived as more intrusive. The main limitation of using focus groups is perhaps the risk that people influence each others response. As a result the response of participants can be different than the response that would have been generated from a private one on one interview. Shareholders from two local, listed companies are going to be considered as the population sample. These companies are Bank of Valletta and HSBC. The choice fell on these companies because due to the recent changes to IAS 39 and IFRS 7, fair value measurement had a considerable impact on the banking sector. Thereby, due to such fact shareholders can be even more concerned and affected with the underlying subject. Two focus groups are planned to be set, one with BOV shareholders and one with HSBC shareholders, with groups ranging from six to twelve members. Shareholders list can be obtained from the Malta Financial Services Authority. The sampled population will exclude overseas shareholders, trusts and investment companies, thus focusing solely on local private shareholders. Chapters Overview: Introduction: firstly the stewardship versus economic decision making debate will be tackled, and its effects on valuation on financial reporting will be analysed. The dissertation shall then focus on the emergence of fair value as a measurement tool and its prospective usage. Furthermore fair value will be compared and contrasted with cost based valuation. The introduction will also include an examination of how each valuation method caters for the individual private shareholders requirements. Literature Review: literature review can be focused on two aspects being the debate of fair value measurement versus cost based measurement, and the debate of whether private shareholders use accounting information mostly for economic decision making, or to assess stewardship. Research Methodology: in this section I shall describe how the results were achieved, explaining how the data was collected and analyzed. This section shall contain the weaknesses and limitations of the research methods and methodology used. In the methodology I shall also include any problems that I anticipated and explain any steps taken to prevent them from occurring. Findings: this part of dissertation will contain the information generated from the focus groups. Results will be presented, interpreted and discussed in this section. Conclusion: this part will provide concluding insights on the research, and recommendations of other research questions that can be tackled to improve the research on the area. The main questions to be answered in this section are: what has been learnt from the results? How can this knowledge be used? What are the shortcomings of the research? Bibliography: Accounting Standards Board. (2007). STEWARDSHIP/ACCOUNTABILITY AS AN OBJECTIVE OF FINANCIAL REPORTING A comment on the IASB/FASB Conceptual Framework Project. UK: Accounting Standards Board. Alan Bryman, E. B. (2007). Business Research Methods 2 edition. UK: Oxford University Press. Doron Nissim, S. P. (2007). ON THE APPLICATION OF FAIR VALUE ACCOUNTING. Columbia Univesity. Lennard, A. (2008). Stewardship and the objectives of financial statements: a comment on IASBs Preliminary Views on an improved Conceptual Framework for Financial Reporting. UK: Accounting Standards Board. RONEN, J. (2008). To Fair Value or Not to Fair Value: A Broader Perspective. Accounting Foundation , Sydney. Schmidt, S. (2004). Fair Value Accounting. US: Governors of Federal Reserve System. Whittington, G. (2008). Fair Value and the IASB/FASB Conceptual Framework Project: An Alternative View . Cambridge: University of Cambridge.

Civil War Poetry Essay -- Pablo Neruda Poets Literature Essays

Civil War Poetry The American Civil War and the Spanish Civil War were primarily wars of principle. The conflicts represented a critical point for each respective nation, a time of either death or continuation for the countries. Both Whitman and Neruda exibit a key shared element in the poets' works of the concept of a cosmic rebirth illustrated in their poetry through a celebration of the perpetual cycle of life and death fostering optimism. This mutual philosophy is manifested in Neruda and Whitman's poetry in several interesting ways. One of the most striking biographical parallels between the two poets originates from their direct involvement in civil war. Whitman served as a nurse in war hospitals during the American Civil War (1861-1865) and his poem Drum Taps, published just after the war ended, chronicles his war experience and serves as a record of the conflict. Nearly seventy years later, Pablo Neruda found himself entangled in a different intra-national conflict, the Spanish Civil War (1936-1939). Neruda served as Chilean consul to Spain in the Republican capital city of Madrid during its bombardment by Federalist forces and later rallied for the Republican cause after being removed from his position. Neruda's poem Spain in the Heart: Hymn to the Glories of the People at War, published as the war still raged in 1937, follows in the tradition of Whitman's Drum Taps, offering an intimate eye witness account of civil war. Through the volumes of Drum Taps and Spain in the Heart, Whitman and Neruda offer poetic responses to their profound experiences during civil war, depicting the potential rebirth of society out of the destruction of war through the victory of democracy. Within thes... ...ope emerging from their tragic but crucial deaths. Neruda represented Whitman's men so intimately tied to the land in the metaphor for renewal out of destruction. The poets in "Eighteen Sixty-One" and "Arrival in Madrid of the International Brigade" assume the role of the voice and interpretive validator of the men using the image of the gathering troops as a vehicle for validating the cause of the conflicts while lamenting the heroic loss of such good men. By intimately connecting with the soldiers through solidarity, the recognition of their sacrifice assumes a more profound significance. The portrait of the soldiers presents these men as heroes who will be able to bring order out of the chaos. The philosophy of cosmic rebirth that Neruda and Whitman share unites the work of the men as it is expressed through their common experience of civil war.

Posting on Reading Essay

Education   Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   How education is valued and how it is tied up with culture and the structure of society is the focus of the article. Moreover, several factors that encourage people to attend higher education are also explored in the article. For instance, several examples about the South Korean culture were revealed in the article in order to emphasize how the view of education changes depending on the culture. For the South Koreans, education is seen as a status symbol and not a stepping-stone to acquire a job in the future. The good thing about it though is that statistics has shown that the percentage of dropouts is less in areas that believe in the relationship between education and societal value.   Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   People from different walks of life have varying points of view regarding education. A survey conducted in order to determine the reasons why people choose to attend higher education reveals that reputation or culture and the enhancement of an individual’s disposition are the topmost reasons why people value their education. At this point, people view the learning and understanding of the English language as an instrumental skill in order to accomplish an individual’s aims to gain a high and respectable social status. Koreans nowadays are struggling to learn the English language, as it gives one a high rank in the social climate. Koreans spend time and effort in studying English that they are willing to undergo rigorous testing just to speak English well.   Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   Perhaps, the article does not only discuss education as part of culture. I think the issues in this article also have strong connections with globalization. As the world moves to become a global village, people are forced to increase their chances of belonging to the international community. This objective shall only be accomplished through further education. This is probably one of the reasons why education is seen as a form of earning a high rank in society because being well educated and learning to speak English well keeps you in a range of belongingness with the rest of the global community. The Costs of Educational Zeal   Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   The article explores the effects of Korea’s valuing of education to the costs of attending the educational institution. Apparently, with the Korean’s growing value for education and the educational institution’s goals to enhance the quality of education, the costs of higher educations have also reached a high. The reasons underlying the high cost of education in the country was explored under different regimes. The influence of colonialism to the educational system of the country contributed much to the high cost that they require of education. Moreover, majority of educational institutions in the country require expensive rates for their services because most of them are privately owned. At this point, I ask myself, why do they need to pay expensive taxes for education when most of the educational institutions are private?   Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   There was not any change during the Park Chung Hee’s term as president of the country. During this time, education was neglected, therefore there were no efforts coming from the government to fix the problem expensive costs of education. Reflecting on it, education in the country has really become a social status, such that only those who can afford it are able to gain the quality education that they deserve. Moreover, the government does not care less whether the people are able to afford education. This reveals how the voices of those people who cannot afford to attend educational institutions are not being heard.   Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   Another factor that influenced the high costs of education was what the people called Kwaoe. Kwaoe is the Korean term for tutoring. This service requires large amounts of money that people cannot help but complain about its cost. At this point of time, the government was able to address this issue and ban tutoring all over the country. Throughout the years, noticeable efforts to alleviate the rising cost of education were evident when reviewing the performances of past governments. However, their efforts were not enough to lessen the cost of paying for an individual’s education. The failure of governments to remodel their educational system is understandable, because from the beginning, the faulty budgeting and financing for educational institutions was adapted by the country. What the country needs to work on is modifying the educational system in order to identify its flaws and once and for all end the high costs of education.

The Origns of The Species by Charles Darwin Essay

The Merriam-Webster Collegiate Dictionary defines cultural anthropology as the anthropology that deals with â€Å"human culture [especially] with respect to social structure, language, law, politics, religion, magic, art, and technology† (1998:282). Anthropology, when broken down, simply means the study of man (anthropos: man and ology: study). The word culture comes from the Latin word â€Å"colere,† which means to cultivate, or to worship. When you understand the meaning of the word, it provides you with a better understanding of what the word represents. Culture is something people create and then â€Å"worship† as a way to feel like a part of something. Cultural anthropology aims to study cultures and how they came to form. WHAT IS CULTURE AND WHERE†¦show more content†¦Because many anthropologists at the time were also religious, degradation theory fit well because it coincided with the Bible and the story of the Tower of Babel. Anthropologists also liked to use phrenology, which was â€Å"the study of the conformation of the skull based on the belief that it is indicative of mental faculties and character† (Merriam-Webster 1998:876), as one of the â€Å"scientific methods† to support racism. An anthropologist would use phrenology to say that certain groups of people were, because of the shape of their head, primitive and lacking intelligence. Surprisingly, phrenology is still used today. In a study published at the University of California, Riverside, researchers â€Å"identified leaders’ facial structure as a specific physical trait that correlates with organizational performance† (Haselhuhn, Ormiston, and Wong 2011). Whether it is a nineteenth century anthropologist or a group of researchers at the University of California in 2011, it is still phrenology. Anthropologists credit Lewis Henry Morgan as being the founder of American cultural anthropology or more broadly as the fath er of â€Å"American anthropology.† Many anthropologists at the time were known as â€Å"arm chair† academics, meaning that they studied anthropology from a distance while sitting in chairs, reading, and thinking; Morgan was not an â€Å"arm chair† anthropologist; He went out into the field to learn