Notesale: Turn your study into money

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UGANDA CHRISTIAN UNIVERSITY, MBALE UNIVERSITY COLLEGE
DEPARTMENT OF BUSINESS AND ADMINISTRATION
ADVANCED ACCOUNTING LECT
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It is not what it was ten
years ago and it will not be what it is now ten years from now
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Preparation of budgets; expected operating results and financial positions of business entities
Financial statement preparation and presentation; to be used by interested groups in
determining the financial operations and results of a business entity
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The present scope of accounting is, however, wider
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In particular, public interest in protecting the natural environment
has grown significantly during the last ten years
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 Different accountants may produce different statements from the same set of data
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ADVANCED ACCOUNTING LECTURE NOTES BY OWINO S FOR BBA 3 WEEKEND UCU

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UGANDA CHRISTIAN UNIVERSITY, MBALE UNIVERSITY COLLEGE
DEPARTMENT OF BUSINESS AND ADMINISTRATION
ADVANCED ACCOUNTING LECT
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The foreword to accounting standards defines accounting standards as authoritative statements
of how particular types of transaction and other events should be reflected in financial
statements
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International Accounting Standards
(IASs) and International Financial Reporting Standards (IFRS) are meant to apply to most
organizations in the world
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International Accounting Standards
(a) Historical Development
The International Standards Committee (IASC), established in 1973, was an independent private
sector body and had no formal authority
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The IASC operated under the umbrella of the International Federation of
Accountants (IFAC), which is the worldwide organization of accountancy bodies and is
independent of any country's government
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One of the problems facing the IASC was that it quite often had to issue standards that
accommodated two or more alternative acceptable accounting treatments
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In 1995 the IASC entered into an agreement with the International Organisation of Securities
Commission (IOSCO) (the body representing stock exchanges throughout the world) to produce
a core set of accounting standards
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This deal was to give IASC its much needed authority
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NOTES FOR BBA 3, SEPT 2018 WEEKEND
backing the IASC had to agree to a restructuring which occurred in 2000
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The European Union, besides issuing directives on company law (Fourth and Seventh
Directives), has also adopted the IASB standards for the preparation of financial statements
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This is referred to as its conceptual
framework
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The framework does not have the status of an
accounting standard
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It assists,
 Preparers of financial statements in applying International Accounting Standards and in
dealing with topics that have yet to form the subject of an International Accounting Standard
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The objective of financial statements;
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Qualitative characteristics of financial information;
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Recognition of the elements of financial statements;
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Concepts of capital maintenance
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NOTES FOR BBA 3, SEPT 2018 WEEKEND

Objectives of Financial Statements is to provide information about :
 The financial position ( Provided in the Balance sheet)
 Financial performance (provided in an Income Statement and the Statement of changes in
Equity
 and changes in financial position (This is the Cash flow of the enterprise
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 There are two more assumptions of secondary importance, which should also be followed:
Materiality and offsetting
Elements of the Financial Statements
The framework identifies five elements:
 assets,
 liabilities,
 Equity interest,
 Income, and
 expenses
ASSET: Is a resource controlled by the enterprise as a result of past events and from which
future economic benefits are expected to flow to the enterprise
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Ownership is usually synonymous with control
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NOTES FOR BBA 3, SEPT 2018 WEEKEND
 Past Events: The event must be ‘past’ before an asset can

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