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The Definition of Financial Accounting Standards

Financial Accounting Standards (IFRSs) is a framework in the financial reporting

procedures to enable the uniformity in the presentation of financial statements. Financial
Accounting Standards (GAAP) is the result of the formulation of the principal Committee of
Accounting Indonesia in 1994 replaces Accounting Principles Indonesia in 1984. SAK in
Indonesia is applied from some existing accounting standards such as IAS, IFRS, ETAP,
GAAP. There was also SFAS sharia and SAP. As a result of rapid technological development
and growth of the economy rapidly this century, has raised various fields of specialization in
accounting. One area of specialization in accounting is accounting finance.

According Kieso and Waygandt (1995) financial accounting are:

"The process that ended in the preparation of financial statements that relate
with the company as a whole to be used, by the parties
both within and outside the company".

The objectives of Financial Accounting Standards

a. Can provide information about the financial position of the company, achievements
and the company's activities, information compiled by accounting principles
commonly expected to have the nature of a clear, consistent, reliable and can be
b. Provide guidelines and regulations for public accountants work so that they can carry
out the task with caution, independent and able to devote expertise and honesty
through the preparation of accounting statements after through an examination of the
c. Provide database to the government on a variety of information considered important
in the calculation of taxes, regulation of companies, planning, and setting the
economy and increase economic efficiency as well as other macro objectives.
d. Able to attract the attention of experts and practitioners in the field of theories and
principles accounting.

Indonesian Institute of Chartered Accountants (IAI)

Indonesian Institute of Accountants, hereinafter referred IAI, is a professional

organization that houses all over the Indonesian Accountants. IAI title in English is the
Indonesian Institute of Chartered Accountants. IAI be the only container that represents the
profession of accountants Indonesia as a whole, both practicing as accountants in public
sector, the private sector accountants, educators accountants, public accountants, management
accountants, tax accountants, forensic accountants, and others.

IAI was founded on December 23, 1957 with two objectives, namely:
1. Guiding the development of accounting and enhance the quality of the education of
accountants; and
2. Enhancing the quality of work accountant.

IAI responsible for organizing professional accountant certification exam (exam

Chartered Accountant-CA Indonesia), maintain professional competence through continuing
education provision, prepare and establish a code of ethics, professional standards, and
accounting standards, applying the discipline of members, as well as developing the
accounting profession in Indonesia.
IAI is a member of the International Federation of Accountants (IFAC), the
organization representing the accounting profession the world over 3 million accountants
who take shelter in 170 professional associations of accountants spread across 130 countries.
As a member of IFAC, IAI has committed to implementing all international standards set for
the sake of high quality and strengthening the accounting profession in Indonesia. IAI is also
a member and founder of the ASEAN Federation of Accountants (AFA). IAI currently
become permanent secretariat AFA.

The History of IAI

Dr. Abutari is the only indigenous Accountant at the time of Indonesia's independence, then
Prof. Soemardjo passed the education of accountants in the Netherlands in 1956.

Accountants Indonesia's first graduated in the country are Basuki Siddharta, Hendra
Darmawan, Tan Tong Djoe, and Go Tie Siem, they graduated in the mid of 1957's. Those four
accountants with Prof. Soemardjo took the initiative to set up associations of accountants for
Indonesia. The reason they might not be a member NIVA (Nederlands Institute Van
Accountants) and found the two institutions may not be thinking about the development and
coaching of accountants Indonesia.

Thursday, October 17, 1957, they held a meeting in the auditorium of the University of
Indonesia (UI) and agreed to establish the association of accountants Indonesia. Because the
meeting was not attended by all accountants, they decided to form committee of
Establishment Preparation Accountants Association of Indonesia. The committee was asked
to contact the other accountants for their opinion. In it, Prof. Soemardjo sits as chairman, Tie
Fo Siem as a writer, Basuki Siddharta as treasurer while Hendra Darmawan and Tan Tong
Djoe as commissioner. The letter sent by the Committee to 6 other accountants answers
Society is finally named the Indonesian Accountants Association (IAI) was finally established
on December 23, 1957, ie at the third meeting, held in the auditorium of the UI at 19:30 pm.

The concept of the first Statutes IAI completed on May 15, 1958 and the final manuscript
was completed on 19 October 1958. Minister of Justice ratified on February 11, 1959.
However, the date of the establishment of IAI is set at 23 December 1957.

Vision and Missions of IAI

IAI's vision is to become the leading professional organization in the development of
knowledge and practice of accounting, business management and public, which is oriented to
ethics and social responsibility, and the environment in national and international

The missions of IAI are:

1. Maintaining the integrity, commitment, and competence of members in the
development of business management and public-oriented ethics, responsibility, and
the environment;
2. Develop the knowledge and practice of business, finance, attestation, non-attest, and
accountant for the community; and
3. Participate actively in achieving good governance through the efforts of legitimate
and in national and international perspective.
Purposes, Objectives, and Functions of IAI
1. IAI intends to collect potential accountants Indonesia to become the driving force of
national development in realizing just and prosperous society based on Pancasila and
the Constitution of 1945.
2. The IAI aims to develop and leverage the potential of Indonesia accountant to form a
creative and works accountant Indonesia for the interests of the nation.
3. IAI serves as a communication forum that bridges the various background tasks and
areas of cooperation that devotion to nature in a harmonious synergy, balance, and