The importance of professional judgement applied in the context of the International Financial Reporting Standards
Guidance has always been welcome in terms of applying professional judgement in the context of the principles-based accounting standards – International Financial Reporting Standards. This fact is the result of the complexity and diversity of some situations, which might give rise to difficulties in...
| Main Author: | |
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| Format: | Article |
| Language: | English |
| Published: |
Chamber of Financial Auditors of Romania
2016-10-01
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| Series: | Audit Financiar |
| Subjects: | |
| Online Access: |
http://revista.cafr.ro/temp/Article_9503.pdf
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| _version_ | 1818550426422738944 |
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| author | Ionela IVAN |
| author_facet | Ionela IVAN |
| author_sort | Ionela IVAN |
| collection | DOAJ |
| description | Guidance has always been welcome in terms of
applying professional judgement in the context of the
principles-based accounting standards – International
Financial Reporting Standards. This fact is the result of
the complexity and diversity of some situations, which
might give rise to difficulties in terms of choosing the
appropriate accounting policies and methods
(depreciation, inventory valuation on hand at the end of
an accounting period, the recognition of revenues and
expenses from a construction contract, accounting for
lease contracts by the proper determination of the type
of lease: financing or operating), and respectively the
need to verify if the criteria set by the principles-based
accounting standards are met. This “freedom” of choice
and disclosure might create problems in terms of
accounting information quality. The possibility to select
accounting methods based on the Standards’ provisions
is meant to generate a true and fair view of the
company’s financial position and financial performance.
In these cases it is recommended to use professional
judgement in order to reach a conclusion which is in
accordance with the accounting principles and is not
enforced by any accounting rules, since the exercise of
individual professional judgement is preferred against
the “pure” compliance with prescriptive legal
requirements. |
| first_indexed | 2024-12-12T08:46:19Z |
| format | Article |
| id | doaj.art-c82ba068ba584f0facef1dd1de0bf17c |
| institution | Directory Open Access Journal |
| issn | 1844-8801 |
| language | English |
| last_indexed | 2024-12-12T08:46:19Z |
| publishDate | 2016-10-01 |
| publisher | Chamber of Financial Auditors of Romania |
| record_format | Article |
| series | Audit Financiar |
| spelling | doaj.art-c82ba068ba584f0facef1dd1de0bf17c2022-12-22T00:30:31ZengChamber of Financial Auditors of RomaniaAudit Financiar1844-88012016-10-01141421127113510.20869/AUDITF/2016/142/11279503The importance of professional judgement applied in the context of the International Financial Reporting StandardsIonela IVAN0 Bucharest University of Economic Studies Guidance has always been welcome in terms of applying professional judgement in the context of the principles-based accounting standards – International Financial Reporting Standards. This fact is the result of the complexity and diversity of some situations, which might give rise to difficulties in terms of choosing the appropriate accounting policies and methods (depreciation, inventory valuation on hand at the end of an accounting period, the recognition of revenues and expenses from a construction contract, accounting for lease contracts by the proper determination of the type of lease: financing or operating), and respectively the need to verify if the criteria set by the principles-based accounting standards are met. This “freedom” of choice and disclosure might create problems in terms of accounting information quality. The possibility to select accounting methods based on the Standards’ provisions is meant to generate a true and fair view of the company’s financial position and financial performance. In these cases it is recommended to use professional judgement in order to reach a conclusion which is in accordance with the accounting principles and is not enforced by any accounting rules, since the exercise of individual professional judgement is preferred against the “pure” compliance with prescriptive legal requirements. http://revista.cafr.ro/temp/Article_9503.pdf Professional judgementprinciple-based accountingtrue and fair viewdisclosuresfinancial reportinglease accounting. |
| spellingShingle | Ionela IVAN The importance of professional judgement applied in the context of the International Financial Reporting Standards Audit Financiar Professional judgement principle-based accounting true and fair view disclosures financial reporting lease accounting. |
| title | The importance of professional judgement applied in the context of the International Financial Reporting Standards |
| title_full | The importance of professional judgement applied in the context of the International Financial Reporting Standards |
| title_fullStr | The importance of professional judgement applied in the context of the International Financial Reporting Standards |
| title_full_unstemmed | The importance of professional judgement applied in the context of the International Financial Reporting Standards |
| title_short | The importance of professional judgement applied in the context of the International Financial Reporting Standards |
| title_sort | importance of professional judgement applied in the context of the international financial reporting standards |
| topic | Professional judgement principle-based accounting true and fair view disclosures financial reporting lease accounting. |
| url |
http://revista.cafr.ro/temp/Article_9503.pdf
|
| work_keys_str_mv | AT ionelaivan theimportanceofprofessionaljudgementappliedinthecontextoftheinternationalfinancialreportingstandards AT ionelaivan importanceofprofessionaljudgementappliedinthecontextoftheinternationalfinancialreportingstandards |