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Financial Reporting and Theory

Please identify what accounting standard is the UK and US using at the moment.
Detail describe what is the difference between principle based accounting standard and rules based accounting standard.
What is the US current status/objectives on current convergence project between the FASB and the IASB.

Critically assess how the use of principles-based standards will aid effective standard-setting by the IASB, and aid decision-usefulness for stakeholders.
(Please provide arguments between rules based & principles based accounting standard. I am looking for an exploration of arguments between rules and principles)

Please use accounting theory examples to back up your arguments.
Please consider the perspective of the standard-setters, their worldview, purpose and objectives.
Using the Kolb diagram will really help, and consider how which model is (or should be) being applied -- is it normative, positive etc.?

1,191 words plus references

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Financial Reporting and Theory

Please identify what accounting standard is the UK and US using at the moment.
The Generally Accepted Accounting Practice in the UK or the UK GAAP is the overall body of regulation. It sets accounting standards. The accounting standards are set by the Accounting Standards Boards which issues standards called the Financial Reporting standards. The ASC's pronouncements are called the Standard Accounting Practice (3).
In the USA the Generally Accepted Accounting Principles are the Accounting standards currently being used in the USA. These are the accounting rules that are used to prepare financial statements. The GAAP includes locally Applicable Accounting Framework and related rules. The Financial Accounting Standards Board sets generally accounting principles for public and private companies.
Detail describe what is the difference between principle based accounting standard and rules based accounting standard.
The difference between principles based accounting standard and rules based accounting standard is that principle based accounting standards are used as a theoretical basis for accountants. These are a set of objectives that ensure good reporting; on the other hand rules based accounting standard gives feature based rules that need to be followed when preparing financial statements. The specific rules based standards are popular because they tell the accountant exactly how to prepare the accounts and if legal action is brought against the accountant, the rules help the accountant defend herself. In principles based accounting standard examples are provided that guide the actions of accountants (2). In addition, broad instructions are given that can be applied in a large variety of situations. On the other hand in case of rules based accounting the accuracy and comparability of accounts and financial statements increases. In addition, the rules prevent the management from making aggressive accounting decision. On the other hand in case of principles based accounting few guidelines can lead to unreliable and inconsistent information.
What is the US current ...

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