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p  p u
Ú  Nghiem Dac Vinh

3 phe 1st country in the world to develop an accountancy
3 Invented the concept of a fair presentation of financial results
and position (the true and fair view)
3 Independent & flexible system

Ñlong history of forming and developing

Ñaffects the accounting systems of many countries such as
Australia, Canada, the US, Hong Kong, India, Kenya, New
Zealand, Nigeria, Singapore, South Africa...
3 Stock market

3 Alternative Investment Market (AIM): a sub-market of

London Stock Exchange for young companies to raise their
capitals founded in 1995.

3 Capital market (less important and efficient)

3 Bank loans

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3 Many financial institutions have raise cash from selling
preference shares to financial institutions and the listings of
these preference shares are bought and sold on the London
stock market.

3 phe preference share holders can often be paid in extra

shares as the investment goes ex dividend

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3 G
    shares means that the company is unlikely to
repay its preference share holders the face value which is 100pence per

3 w
   works slightly different in that the company has the
option to redeem the preference share holders.

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3 Developed from 
in the medieval
3 Based on a combination of {   


3 ©„ublic & „rivate sectors
3 Fairly {{
 because of the differences between
England, Northern Ireland, Scotland and Wales
3 „refer of using M


but deal is a deal


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©  © 


1 phe Institute of Chartered Accountants in England and Wales 1880* 126
2 phe Institute of Chartered Accountants in Ireland 1888 14
3 phe Institute of Chartered Accountants in Scotland 1951* 15
4 phe Association of Chartered Certified Accountants 1939* 98
5 phe Chartered Institute of Management Accountants 1919 62
6 phe Chartered Institute of „ublic Finance and Accountancy 1973* 14000

* Re-formed or changed name from another body

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(through Her Majesties
Revenue and Customs (HM
Revenue & Customs)
Income tax Business rates
National insurance
VAp (value added tax) Council tax
Corporation tax Fees such as on-street parking
Inheritance tax And more...
Excise duties
And more...

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Separate report for tax office

Ñpax law has 

{ on financial reporting.

3 Accounting profit is  the taxable income, but

3 phe tax authorities (HM Revenue and Customs) are trying to
move them closer.

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3 Former owner of many colonies: -      

3 Long and strong political relationships with the US

3 Independent-but-belong-to relationship with the EU

3 Main export partners:        

 !  "

3 Main import partners:   #   

  !  "

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3 Deflation between mid 2008 and 2009 was due to sharp drop
in commodity prices such in crude oil.

3 phe risk of inflation can be reduced by investing in a wide

range of bonds.

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* Economic growth continuously from 1992 to 2007: period of
unbroken UK GD„
* In 2008 it started to feel like a distant dream:
A GD„ growth turned negative
A phe British „ound started to collapse
* Nevertheless:
A phe sixth largest economy in the world by purchasing
power parity („„„)
A High level of development

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3 All children in England and Wales between ages 5 and 16
must receive a full-time education.

3 Approximately 1.8 million students are currently enrolled in

the UK higher education system.

3 High level

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¦  {  
3 Individualism
3 Small power distance
3 Weak uncertainty avoidance
3 Masculinity
-   $   

¦  {{ M

3 „rofessionalism (vs. Statutory Control)
3 Flexibility (vs. Uniformity)
3 Optimism (vs. Conservatism)
3 (complicated) pransparency (vs. Secrecy)
! % $   &   '(()  * 
, '''

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3 Important influences: the dM
(1988) and the
 { (1989)

3 Ô{
M© {!Ô©was established in
May 1990.

3 6 professional bodies of the ©© Ú had to supervise their

members in the public interest and continuing to serve the
private interests of their members at the same time. Ñ
conflicts of interests.

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5 bodies was set up to solve the conflict:

ë {{ { Ô 


# { $ Ú!$Ú
 M {{
Ú! Ú
% &
M'd {

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From 2003, FRC has responsibility for both accounting and auditing standards
and also their enforcement. Besides, it has responsible for 5 re-formed bodies:
ë {{ M$ Ú! $Ú

" M {{

Ú! Ú

# Ô{


 {{ { &

M'd {
Ú! &dÚre-
formed to be {{ { ' { d {
Ú ! dÚin

% 

 Mڏ {{ { ! Ú changed
name to be the 

 MÚ! Úfrom 2006.

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Ô  w 

Financial Statements include:

3 Director·s report
3 „&L , BS
3 Cash flow statement (st.).
3 St. of total recognized gains and losses
3 St. of accounting policies
3 Notes referenced in the
3 Auditor·s report
Ô  w 

3 p
has to show:
A „rincipal business activities
A Important post-balance sheet events
A Recommended dividends
A Names of the directors and shareholders

must include:
A a statement on corporate governance,
A audit committees and internal controls and
A a declaration that the company is a going concern.
Ô  w 

3 Financial statements must present 


3 phe London Stock Exchange requires that listed companies

provide 


3 phe small and medium sized companies are 

many financial reporting obligations.
3 Calculated as the difference between the fair value of the
consideration paid and the fair value of the net asset

3 Future operating losses and reorganization costs cannot be

considered in the calculation of goodwill.

3 Capitalized and amortized over 20years or less.

3 Depreciation and amortization must correspond to the
measurement basis used for the underlying asset.

3 Inventory is valued at the lower of cost or net realizable

value on a FIFO or average cost basis.

3 Long term deferred tax balances may be flexibility that

exists in asset valuation and other measurement areas.
3 UK accounting system has 


 than US because in UK standards are
revised without changing their number.

3 UK (and IASB) standards have 

than US standards,
because of the differences between ¶principle-based· and
¶rule-based· standards.

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1) Wikipedia and the Internet
2) Comparative International Accounting, #   * 

w * -%  ../
3) Culture Shock! ² Success secrets to maximize business in
Britain, -   '''

(*) Information/data without reference notes is referred from

teacher·s hand-outs