Description:
This course aims to expose students to the debate surrounding major accounting issues over the past decades, in particular, the attempts to establish a theory of accounting and the development of the conceptual framework for financial reporting. This subject will highlight the international nature of accounting and its problems as evidenced in the theoretical debates, standard setting and regulatory processes. In understanding and critically analysing these issues students will be exposed to the body of academic research that has contributed to the development of the accounting discipline, particularly to seminal works. As a final year subject that draws upon the learning students have gained thus far, students will be shown how to relate accounting theory to accounting practices that have been previously taught. In so doing, students will be able to improve their ability to evaluate and analyse accounting problems.
Development of graduate attributes
Graduates from the Bachelor of Business program are expected to have knowledge, skills and abilities (KSA) on three different dimensions. Each subject in your course contributes in some way to the development of the Stott's Graduate Attributes which you should demonstrate by the time you complete your course
Professional
GA1 Hold a body of knowledge relevant to their field of study, that includes an understanding of theories, practices, and the scope of their discipline;
GA2 Have the skills required to operate effectively within their chosen profession;
Personal
GA3 Have developed an appreciation, tolerance and ability to work effectively across the entire diversity spectrum;
GA4 Be able to work independently and collaboratively;
GA5 Be able to set appropriate goals for ongoing intellectual and professional development;
GA6 Be self-critical and identify shortcomings in their own knowledge, skills and abilities GA7 Understand ethical responsibilities and behaviour pertinent to their chosen discipline
and profession and practise the behaviour to the highest standards;
GA8 Have developed a high level of oral, visual and written communication skills, across a range of communication technologies, relevant to their fields of study, and recognise the importance of maintaining these.
Academic
GA9 Be able to identify the need for data, information and knowledge to solve problems in familiar and unfamiliar contexts using appropriate media, tools and methodologies and be able to critically evaluate the information in terms of its validity, accuracy, currency against one's own values.
GA10 Be independent learners and thinkers with responsibility to acquire and evaluate new knowledge with the confidence to be analytical, creative and critical;
GA11 Be able to understand, define, analyse, evaluate, investigate problems and make informed recommendations and decisions;
Learning Outcomes:
In this subject, students examine the major current issues in accounting and the emergence of the standard setting process and conceptual framework. Accounting is viewed from the theoretical perspective. At the completion of this subject a student should be able to:
LO1 Evaluate attempts to develop and apply a conceptual framework,
LO2 Appraise the objectives of accounting and relate them to the various concepts of accounting as studied in prior subjects,
LO3 Analyse the applications of alternative measurement systems to historical cost, LO4 Evaluate current financial reporting and theoretical issues.
CONTENT
1. Contemporary issues in accounting.
2. The conceptual framework for financial reporting
3. Standard setting
4. Measurement and annual reports
5. Theories in accounting
6. Capital market research and corporate governance
7. Earnings management
8. Sustainability and Environmental Accounting
9. Fair value accounting
10. Corporate failure
11. Special reporting issues
12. International Accounting
Read the following article written by Paul M. Healy and Krishna G. Palepu, the fall of Enron case study by Paul M. Healy and Krishna G and write a report that addresses the following issues:
1. Define and explain mark-to-market accounting approach and give examples where Enron's management / accountants perhaps misused this approach to portray a rosy picture of its performance / profitability?
2. What are special purpose entities and how Enron's management used them to fund contracts or achieve financial reporting objectives?
3. Enron's top management enjoyed high compensation/ remuneration including stock options, what was the main purpose of the stock options compensation scheme provided to top management. Your explanation, discussion and argument should principally be based on the assumption of the agency theory.
4. Have the accountants / auditors involved in the case behaved in accordance to the code of ethics for professional accountants? Explain and discuss the fundamental principles of the code of ethics in relation to the case and provide examples.
The assignment must be written in essay form with a clear introduction, a demonstrate critical arguments and draw strong conclusions. While the word allowance is 3,000 words an allowance of no more than 10% either way will be acceptable. All work must be the student's own work and sources clearly cited within the text according to APA 6th edition referencing style. A reference list must be incorporated at the end of the assignment. Only submissions via Moodle will be accepted and late penalties of 10% per day will be incurred if not submitted on or before the due date. Any forms of plagiarism will result in a fail grade and notification of the plagiarism will be sent to the Academic Dean.