Accounting Theory and Practice Reflection Essay

Topics: International Financial Reporting Standards, Ethics, International Accounting Standards Board Pages: 4 (1157 words) Published: August 24, 2012
To over view the knowledge we learnt from accounting theory and practice, the main thing I can conclude that is the tendency of accounting will shift away from technical way to people’s behaviour way. By understanding what should do, we should ask why and how we could improve and change it into a better way. This essay aims to explain how the theoretical material that we learn in lectures can be developed under a real practical manner.

When talking about accounting, the first thing we should know is the history of its development. Traditionally, the development is from inductive to deductive. Inductive theory assume what is done by the majority is the most appropriate practice. However, It did not seek to evaluate the logic or merit of accounting practices being used. Then later on normative theory have been proposed, which is based on logical argument. It seems a guideline to tell us what should do, which method should use in a particular situation. Conceptual framework is one example of normative theory released by International Accounting Standards Board (IASB)

As variety country already adopt conceptual framework, it is significant to understand what is the role in accounting. Conceptual framework is a set of coherent system of interrelated objective and fundamentals that is expected to lead to consistent standards. Nowadays, there are many countries already adopt it, the recent work of FASB and IASB is try to provide a single set of accounting standard. International convergence is a process that eventually results in the adoption of International Financial Reporting Standards (IFRS). It is difficult, at least not in a short time for all countries to change in to IFRS since countries use different system of accounting due to the differences in economic social and environment factors such as culture, religions, taxation and legal system. However, as the topic in discuss forum we did, there are numerous benefits of convergence, companies with a global...
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