New [SSRN] Post: Jamal et al., A Perspective on the Canadian Accounting Standards Board Exposure Draft on GAAP for Private Enterprises

Karim Jamal et al., have announced a new article on SSRN dealing with GAAP principles relevant to accountants and lawyers alike: A Perspective on the Canadian Accounting Standards Board Exposure Draft on GAAP for Private Enterprises in Accounting Horizons (forthcoming). The study authors are:

Karim Jamal (University of Alberta – Department of Accounting & Management Information Systems)
Robert J. Bloomfield (Cornell University – Samuel Curtis Johnson Graduate School of Management)
Theodore E. Christensen (Brigham Young University – Marriott School of Management)
Robert H. Colson (Grant Thornton LLP)
Stephen R. Moehrle (University of Missouri at St. Louis – Accounting Area)
Stephen H. Penman (Columbia University – Department of Accounting)
Gary Previts (Case Western Reserve University – Department of Accountancy)
James A. Ohlson
Thomas L. Stober (University of Notre Dame – Department of Accountancy_
Shyam Sunder (Yale School of Management)
Ross L. Watts (Massachusetts Institute of Technology (MIT) – Sloan School of Management)
Here is the abstract:
Canadian Accounting Standards Board (AcSB) recently issued an exposure draft to adopt separate GAAP for private enterprises. This new GAAP is justified as being consistent with the current FASB/IASB conceptual framework, but is sensitive to the different cost/benefit considerations facing private entities. We view this proposal as being innovative and responsive to the differential reporting needs of private entities. In this article we explain our reasoning and conclusions on several issues raised by the exposure draft starting with a discussion about the need for a separate conceptual framework for private enterprises. We sketch a preliminary conceptual framework that could be used to develop and justify the type of changes proposed in this exposure draft. We then discuss key issues raised in the exposure draft such as reliance on historical cost as the key basis of measurement, the significant reduction in disclosure requirements for private enterprises, and stopping the emerging issues committee from providing implementation guidance (no EIC’s). We also comment on the mechanism for financing the standard setting board, the need to ensure compatibility between accounting and auditing standards, and a process for adjusting the education system to support this new private enterprise GAAP.

Leave a Reply

Please log in using one of these methods to post your comment: Logo

You are commenting using your account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s

%d bloggers like this: