Policy Choices under IFRS in UK and German Context Essay

Policy Choices under IFRS in UK and German Context - Essay ExampleThe present research has identified that after the mandatory adoption of IFRS by the public listed companies in 2005-06 especially in the Euro zone, the companies develop their financial statements in accordance with the rule of thumb provided by the IFRS. IFRS, however, allows different policy choices for the companies to make. For example, in measuring the lineage, IFRS has provided a policy choice of measuring inventory amount on the basis of either FIFO system or on weighted sightly method. Similarly, some other choices have also been framed by IFRS to the companies, like they can value their property, rig and equipment either on approach model or revaluation model etc. Nobes studied this cranial orbit of research and outlined 16 policy choices that are mostly available to the companies. The four choices have been eliminated from this psychoanalysis as some of them are industry specific and some of them ar e honey oilly used by every company no matter in which industry they operate. The rest of twelve policy choices do have some issues with them as some organizations do non disclose their policies at times. The most common examples are of investment property and inventory such that in relation to investment property, organizations do not disclose whether these investment properties are valued at cost or fairish value, and in suit of clothes of inventories, organizations at times do not disclose whether the inventories are valued at FIFO method or weighted average method. ... ing pro?t (b) no such line 3 (a) lawfulness accounting results included in operating (b) immediately after (c) after ?nance 4 (a) rest period planing machine shows assets = credits (b) demonstrate net assets 5 (a) liquidity decreasing in balance sheet (cash at top) (b) liquidity increasing 6 (a) Statement of Changes in Equity, including dividends and share issues (b) SORIE, not including them 7 (a) take u p operating cash ?ows (b) indirect 8 (a) dividends received shown as operating cash ?ow (b) as investment 9 (a) interest paid shown as operating cash ?ow (b) as ?nancing 10 (a) lone(prenominal) cost for PPE (b) some fair value 11 (a) investment property at cost (b) at fair value 12 (a) some designation of ?nancial assets at fair value (b) none 13 (a) capitalisation of interest on construction (b) expensing 14 (a) FIFO for inventory cost (b) weighted average 15 (a) actuarial gains and losses to SORIE (b) to income in full (c) corridor 16 (a) proportional consolidation of some enounce ventures (b) only equity method The following table reflects the 6 big corporations of UK which represents their policy choices of IFRS. Policy Changes GSK Astra Zeneca BAE British Airways Rolls Royce SAB miller Total Percentage 1 (a) income statement by function 1 1 1 1 1 5 83.33% (b) by nature 1 1 16.67% (c) Neither 0 0.00% 2 (a) cellular inclusion of a line for EBIT or operating profit 1 1 1 1 1 1 6 100.00% (b) no such line 0 0.00% 3 (a) equity accounting results of associates and joint ventures included in operating 1 1 16.67% (b) immediately after 0 0.00% (c) after finance 1 1 1 1 1 5 83.33% 4 (a) balance sheet showing assets = credits 1 1 16.67% (b) showing net assets 1 1 1 1 1 5 83.33% 5 (a) liquidity decreasing (cash at top) 0 0.00% (b) liquidity