Sie sind auf Seite 1von 13

University of Dhaka Faculty of Business Department of Accounting & Information Systems Course: Accounting Theory (4204)

Term paper on: International Accounting Standards (IAS)

Submitted to:
Amirus Salat Assistant professor Department of Accounting and Information systems University of Dhaka

Submitted by:
Group Spartacus Name of members Kanak Chandra Das Tahmid Ahmed Sohel Durjay Bairagi Noor Mohammad Mojahidul Islam Johny Shariful Islam ID 14007 14070 14072 14076 14090

Date of submission: 30 November 2011

Introduction:

An older set of standards stating how particular types of transactions and other events should be reflected in financial statements. In the past, international accounting standards (IAS) were issued by the Board of the International Accounting Standards Committee (IASC). Since 2001, the new set of standards has been known as the international financial reporting standards (IFRS) and has been issued by the International Accounting Standards Board (IASB).IASC has no authority to require compliance with its accounting standards. However, many countries require the financial statements of publicly-traded companies to be prepared in accordance with IAS. International Accounting standards are some specific standards that must be followed by every company in preparing and presenting its financial statements fairly. If a company does not follow IAS & IFRS strictly, their financial statements is said to be not fairly presented that means their financial statements does not give a true and fair view of information presented by them. The user of financial statement information does not take decision from that financial statement information. Auditor of the company does not give any opinion if it does not follow the international accounting standards. So international accounting standards are very important for every company that prepares and present financial statement.

Description of IAS:

We select three IAS & an IFRS that are (1) IAS-1, (2) IAS-24,(3) IAS-7 (4) IFRS 8 to see whether the bank follow these or not 1. IAS-1: Presentation of financial statements. 2. IAS-24: Related party disclosure. 3. IAS-7: Cash flow statement 4. IFRS 8: Disclosure of Financial Statements

3.0. Presentation and compliance of IAS in Selected companies 3.1. Mercantile Bank Limited (MBL) Mercantile Bank Limited ( the Bank) was incorporated in Bangladesh as a public limited by shares under the companies act 1994 as on May 20, 1999 and subsequently obtained banking operation license from Bangladesh bank under the bank companies act 1991 started business operation on June 02,1999. The bank is listed with both in Dhaka Stock Exchange and Chittagong Stock Exchange. The bank has presently 53 branches including 3 agro branches across the country at the end of December 2009 and the bank has no overseas branches. Presentation and compliance of IAS in Mercantile Bank Limited are-

Objective of IAS-1: The objectives of IAS-1 is to prescribe the basis for presentation of general purpose financial statement, to ensure comparability both with the entitys financial statements of previous periods and with the financial statements of other entities.

3.1.1 International accounting standards (IAS)-1: SL.NO 1. 2. 3. 4. 5. 6. Components of financial statements Compliance status Statement of financial statement/ Balance sheet Statement of comprehensive income/ Profit and Loss account Statement of change in equity Statement of cash flow Notes comprising a summary of accounting policies and other explanatory notes Statement of financial position as at the beginning of N/A the earliest comparative period when an entity applies an accounting policy retrospectively or makes retrospective statement at the times of financial statement or when it reclassifies items.

3.1.2 Presentation and compliance with IFRS: When elements of financial statements fulfill all their recognition criteria, then the financial statements is called fair financial presentation. All the elements of financial statements of MBL fulfill their own recognition criteria. so the financial statements of MBL is fairly presented. 3.1.3 Going concern: Going concern means the entity lasts long to fulfill its goals and objects.MBL has fulfilled the going concern assumption. It assesses the current and expected profitability, debt payment schedule and potential source of replacement . 3.1.4 Accrual basis of accounting MBL prepares its financial statement except for cash flow information using the accrual basis of accounting. 3.1.5Materiality and aggregation This feature is not applicable for MBL.

3.1.6 Offsetting MBL does not offset asset and liability, and income and expenses. 3.1.7 Comparative information: MBL disclosed information about the previous period amounts reported in the financial statement both face of F/S and notes.

3.1.8 Consistency of presentation: MBL retained the presentation and classification of items in the F/S from one period to the next. 3.1.9 Reporting period: MBL prepared its financial statement annually. So it fulfills the reporting period criteria. 3.1.10 Statement of financial position: MBL shows the minimum face and line item in the F/S like property plant and equipment, investment property, intangible assets, trade and other receivable, cash and cash equivalents, provision, tax liability, issued capital and reserves. 3.1.11 Profit and loss account MBL shows the minimum face item of P/L account that are revenue, finance cost, tax expenses. 3.1.12 Statement of change in equity: MBL does not show the statement of change in equity. IAS 24(related party disclosure) 3.1.13 Definition Related party directly or indirectly has control significant influences or joint control. 3.1.14 objective The objective of IAS 24 is to inform users that its financial position and performance may be affected by the existence of related parties and by transactions and outstanding balance with such parties. 3.1.14 Disclosure

MBL discloses significant contracts where bank is a party and herein directors have interest. So MBL complies with IAS 24.

4.1.1Definition An operating segment is a component of an entity that engages in business activities from which it may earn revenues and incur expenses (including revenues and expenses relating to transactions with other components of the same entity) whose operating results are reviewed regularly by the entitys chief operating decision maker to make decisions about resources to be allocated to the segment and assess its performance; and for which discrete financial information is available. 4.1.2 Objective IFRS 8 applies to the separate or individual financial statements of an entity (and to the consolidated financial statements of a group with a parent): whose debt or equity instruments are traded in a public market; or that files, or is in the process of filing, its (consolidated) financial statements with asecurities commission or other regulatory organisation for the purpose of issuing anyclass of instruments in a public market. However, when both separate and consolidated financial statements for the parent are presented in a single financial report, segment information need be presented only on the basis of the consolidated financial statements. 4.1.3 Diclosure New disclosures include information about how the entity identifies its operating segments and the types of products and services from which each segment derives its revenues. Interest revenue and interest expense must be reported separately for each reportable segment, if the amounts are included in the measure of segment profit or loss, or are otherwise regularly reported to the chief operating decision maker, unless the majority of the segments revenues are from interest and the chief operating decision maker relies primarily on net interest revenue when making resource allocation decisions and to assess segment performance.

3.2. Uttara Bank Limited Uttara Bank Limited had been a nationalized bank in the name of Uttara Bank under the Bangladesh bank (Nationalization) order 1972, formerly known as the Eastern Banking Corporation limited which was stated functioning on and from 28.1.1965. Consequent upon the amendment of Bangladesh bank (nationalization) order 1972, the uttara bank was converted into uttara bank limited as a public limited company in the year 1983. The uttara bank limited was incorporated as a banking company on 29.6.1983 and obtained business commencement certificate on 21.8.1983. The bank is carrying out its banking activities all over the country through its 207 branches. The bank is enlisted in both Dhaka Stock Exchange and Chittagong Stock Exchange. Objective of IAS-1: The objectives of IAS-1 is to prescribe the basis for presentation of general purpose financial statement, to ensure comparability both with the entitys financial statements of previous periods and with the financial statements of other entities.

3.2.1 International accounting standards (IAS)-1: SL.NO Components of financial statements 1. 2. Statement of financial statement/ Balance sheet Statement of comprehensive income/ Profit and Loss account Statement of change in equity Statement of cash flow Notes comprising a summary of accounting policies and other explanatory notes Statement of financial position as at the beginning of the earliest comparative period when an entity applies an accounting policy retrospectively or makes retrospective statement at the times of financial statement or when it reclassifies items.

Compliance status

3. 4. 5. 6.

N/A

3.2.2 Presentation and compliance with IFRS: When elements of financial statements fulfill all their recognition criteria, then the financial statements is called fair financial presentation. All the elements of financial statements of UBL fulfill their own recognition criteria. So the financial statements of UBL are fairly presented.

3.2.3 Going concern:

Going concern means the entity lasts long to fulfill its goals and objects.UBL has fulfilled the going concern assumption. It assesses the current and expected profitability, debt payment schedule and potential source of replacement. 3.2.4 Accrual basis of accounting UBL prepares its financial statement except for cash flow information using the accrual basis of accounting.

3.2.5 Materiality and aggregation This feature is not applicable for UBL. 3.2.6 Offsetting UBL does not offset asset and liability, and income and expenses. 3.2.7 Comparative information: UBL disclosed information about the previous period amounts reported in the financial statement both face of F/S and notes. 3.2.8 Consistency of presentation: UBL retained the presentation and classification of items in the F/S from one period to the next. 3.2.9 Reporting period: UBL prepared its financial statement annually. So it fulfills the reporting period criteria. 3.2.10 Statement of financial position: UBL shows the minimum face and line item in the F/S like property plant and equipment, investment property, intangible assets, trade and other receivable, cash and cash equivalents, provision, tax liability, issued capital and reserves.

3.2.11 Profit and loss account UBL shows the minimum face item of P/L account that are revenue, finance cost, tax expenses.

3.2.12 Statement of change in equity:

UBL does not show the statement of change in equity. IAS 24(related party disclosure) 3.2.13 Definition: Related party directly or indirectly has control significant influences or joint control.

3.2.14 objective The objective of IAS 24 is to inform users that its financial position and performance may be affected by the existence of related parties and by transactions and outstanding balance with such parties. 3.1.14 Disclosure UBL discloses significant contracts where bank is a party and herein directors have interest. So UBL complies with IAS 24.

3.3. Janata Bank Limited Janata Bank Ltd. was incorporated as a public limited company on May 21 2007 vide certificate of incorporation #c 66993 (4425)/07. The bank has taken over the business of janata bank (emerged as a nationalized commercial bank in 1972, pursuant to sub-sec- 24(5) Bangladesh bank (nationalization) order no- 1972 p. o. No. 26 of 1972) at a purchase consideration of tk. 2593 million as a going concern through a vendor agreement between the ministry of finance of the peoples republic of Bangladesh and the board of directors on behalf of janata bank limited on 15th November 2007 with retrospective effect from 1st July 2007. Objective of IAS-1: The objectives of IAS-1 is to prescribe the basis for presentation of general purpose financial statement, to ensure comparability both with the entitys financial statements of previous periods and with the financial statements of other entities.

3.3.1 International accounting standards (IAS)-1: SL.NO 1. Components of financial statements Statement of financial statement/ Balance sheet Compliance status

2. 3. 4. 5.

Statement of comprehensive income/ Profit and Loss account Statement of change in equity

Statement of cash flow Notes comprising a summary of accounting policies and other explanatory notes 6. Statement of financial position as at the beginning of the earliest comparative period when an entity applies an accounting policy retrospectively or makes retrospective statement at the times of financial statement or when it reclassifies items. 3.3.2 Presentation and compliance with IFRS:

N/A

When elements of financial statements fulfill all their recognition criteria, then the financial statements is called fair financial presentation. All the elements of financial statements of JBL fulfill their own recognition criteria. so the financial statements of JBL is fairly presented. 3.3.3 Going concern Going concern means the entity lasts long to fulfill its goals and objects.JBL has fulfilled the going concern assumption. It assesses the current and expected profitability, debt payment schedule and potential source of replacement. 3.3.4 Accrual basis of accounting JBL prepares its financial statement except for cash flow information using the accrual basis of accounting. 3.3.5 Materiality and aggregation JBL presents separately in the F/S each material class of similar items . 3.3.6 Offsetting JBL does not offset asset and liability, and income and expenses. 3.3.7 Comparative information: JBL disclosed information about the previous period amounts reported in the financial statement both face of F/S and notes. 3.3.8 Consistency of presentation:

JBL retained the presentation and classification of items in the F/S from one period to the next.

3.3.9 Reporting period JBL prepared its financial statement annually. So it fulfills the reporting period criteria. 3.3.10 Statement of financial position: JBL shows the minimum face and line item in the F/S like property plant and equipment, investment property, intangible assets, trade and other receivable, cash and cash equivalents, provision, tax liability, issued capital and reserves.

3.3.11 Profit and loss account JBL shows the minimum face item of P/L account that are revenue, finance cost, tax expenses. 3.3.12 Statement of change in equity: JBL does not show the statement of change in equity. IAS 24(related party disclosure) 3.3.13 Definition Related party directly or indirectly has control significant influences or joint control. 3.3.14 objective The objective of IAS 24 is to inform users that its financial position and performance may be affected by the existence of related parties and by transactions and outstanding balance with such parties. 3.3.14 Disclosure JBL discloses significant contracts where bank is a party and herein directors have interest. So JBL complies with IAS 24.

3.4 Southeast Bank Limited Southeast Bank Limited was incorporated as a public limited company on March 12, 1995. The bank is one of the leading banks in the banking industry of Bangladesh. The bank provides

different banking services in order to fulfill the various demands of customers. The bank is enlisted in both Dhaka Stock Exchange and Chittagong Stock Exchange. The vision of the bank is to be a leader in the banking industry and contribute to the economic development of Bangladesh.

Objective of IAS-1: The objectives of IAS-1 is to prescribe the basis for presentation of general purpose financial statement, to ensure comparability both with the entitys financial statements of previous periods and with the financial statements of other entities.

3.4.1 International accounting standards (IAS)-1: SL.NO Components of financial statements 1. 2. Statement of financial statement/ Balance sheet Statement of comprehensive income/ Profit and Loss account Statement of change in equity Statement of cash flow Notes comprising a summary of accounting policies and other explanatory notes Statement of financial position as at the beginning of the earliest comparative period when an entity applies an accounting policy retrospectively or makes retrospective statement at the times of financial statement or when it reclassifies items.

Compliance status

3. 4. 5. 6.

N/A

3.4.2 Presentation and compliance with IFRS: When elements of financial statements fulfill all their recognition criteria, then the financial statements is called fair financial presentation. All the elements of financial statements of SBL fulfill their own recognition criteria. So the financial statements of SBL are fairly presented.

3.4.3 Going concern: Going concern means the entity lasts long to fulfill its goals and objects.SBL has fulfilled the going concern assumption. It assesses the current and expected profitability, debt payment schedule and potential source of replacement.

3.4.4 Accrual basis of accounting SBL prepares its financial statement except for cash flow information using the accrual basis of accounting. 3.4.5 Materiality and aggregation This feature is not applicable for SBL. 3.4.6 Offsetting Financial assets ad financial liabilities are offset and the net amount reported in the balance sheet when there is a legally enforceable right to offset the recognized amount and there is an intention to settle on a net basis, or realize the asset and settle the liability simultaneously.

3.4.7 Comparative information: SBL disclosed information about the previous period amounts reported in the financial statement both face of F/S and notes. 3.4.8 Consistency of presentation: SBL retained the presentation and classification of items in the F/S from one period to the next. 3.4.9 Reporting period: SBL prepared its financial statement annually. So it fulfills the reporting period criteria. 3.4.10 Statement of financial position: SBL shows the minimum face and line item in the F/S like property plant and equipment, investment property, intangible assets, trade and other receivable, cash and cash equivalents, provision, tax liability, issued capital and reserves.

3.4.11 Profit and loss account SBL shows the minimum face item of P/L account that are revenue, finance cost, tax expenses. 3.4.12 Statement of change in equity: SBL does not show the statement of change in equity. IAS 24(related party disclosure)

3.4.13 Definition: Related party directly or indirectly has control significant influences or joint control.

3.4.14 objective The objective of IAS 24 is to inform users that its financial position and performance may be affected by the existence of related parties and by transactions and outstanding balance with such parties.

3.4.14 Disclosure SBL discloses significant contracts where bank is a party and herein directors have interest. So SBL complies with IAS 24.

5.0. Conclusion: Among so many sectors, Banking sector is one which is of a pivotal importance. Many investors put up their valuable savings in this sector. So, if the investors are not able to obtain relevant and reliable information, they will be in a dilemma whether to put up investment which might result in not investing at all. If the banking companies conform to IAS & IFRS so as to the availability of the information make the investors feel content then the investors will feel inspired. So every company should conform to IAS & IFRS,

Das könnte Ihnen auch gefallen