The Usefulness of Accounting Standard in the Preparation of Financial Statement

The Usefulness of Accounting Standard in the Preparation of Financial Statement

TABLE OF CONTENT

Title page
Approval page
Dedication
Acknowledgement
CHAPTER ONE
Introduction
1.1 Statement of the problem of accounting standards
1.2 How did accounting standards come to be in the developed world
1.3 How did accounting standards come to be in Nigeria
1.4 Various bodies that regulate the development of accounting standard and accounting statesman they prepare
CHAPTER TWO
Literature review
2.1 The usefulness of accounting standards in the preparation of the financial statement
2.2 The procedure for the issuance of accounting standards
2.3 Relevance of accounting statement to auditing
2.4 Effectiveness of accounting statement
CHAPTER THREE
3.1 Summary of finding
3.2 Recommendation
3.3 Conclusion
Bibliography

CHAPTER ONE

1.0 INTRODUCTION

As a result of increased commercial activities throughout the world, many big businesses expand beyond their countries to have a share of the world market.

Therefore, established branches are translated accordingly based on exchange rates existing and at the end set of financial statements are prepared and published.

In preparing these financial statements normal accounting practices and procedures must be followed and several legal and other requirements observed.

In the international market, it was observed that accounting policies could differ in one single transaction.

For instance, in a group involving foreign subsidiaries, the method of valuing stock may not be the same if the Nigerian company for example use last – in – first – out (LIFO) and the other seas company uses first – in–first – out (FIFO) the result will differ.

In addition to accounting policies reporting formats and disclosure requirements may not be the same there is, therefore, the need for accounting policies and disclosure requirements to be internationally comparable and acceptable.

Accounting standards like international accounting standard (IAS) statement of standard accounting practices (SSAP) financial reporting standard etc.

Constitute a set of definitive principles to be followed when preparing financial statement departures from principles and practice enunciated in this standard are permissible in exceptional circumstances only where adherences would fail to give a true and fair view in a specific instance or because the accounting standard world is inappropriate or because exemption from disclosure is spanned by status.

1.1 STATEMENT OF PROBLEM OF ACCOUNTING STANDARD’S

Nigeria accounting standard board has stated accounting standard which has compliance with international accounting standards.

The following standards have been issued in Nigeria and each of them has a particular IAS it complies with SAS 1 – disclosure of accounting policies