BAC1634 FINANCIAL ACCOUNTING & REPORTING 1

TUTORIAL 1

Visit these websites to answer the questions:

http://www.masb.org.my/

https://www.ifrs.org/

Q1- Why do we need global accounting standards?

Global accounting standard set a common ground for financial statements to be set for all industries so
that all financial statement can be compared. The comparison is useful for providing adequate and
relevant decision making by both industries management and investors. It also reduce the unnecessary
cost and resources in unifiying various stardard across differrent countries, which makes recoding of
international economical transactions difficult.

Q2- What is Exposure Draft? Does Expose Draft different from the MFRS?

Exposure draft is the draft standard which the board open for comments from any interested
parties, receiving dissenting views to the proposals, set up proposed details to the
amendments and the basics of conclusion.

This allows to solicit public opinions and views from the interested parties before finallised the
draft as a standard.

MFRS is a set of standards, principles, and procedures that allows the unification of financial
reporting policies and practices.

Q3- Big Cup Berhad is a listed company engaging in the manufacturing business. The
financial year end is 31 March annually. The company should comply with the MFRS 16.
State the financial period that Big Cup Berhad should adopt MFRS 16.

Q4- How does IFRIC Interpretation Committee contribute to standards development and
implementation?

IC allows questions regarding a standard to be raised. Then it decides whether a standard is required to
be set to address the questions. It may choose not to set up a standard as it may be isolated problem or
enactment of new standard may raise additional issue to other entity. Th IC then lay out agenda decision
which is opened for comments for 60 days and provides additional info regarding how to apply the
standard.