The regulatory environment and financial reporting

You are employed in a large accounting firm which specialises in preparing general purpose financial reports for large companies that are listed on the Australian Securities Exchange (ASX). As the training manager, one of your key tasks is to prepare a regular newsletter for staff involved in the preparation of the above financial reports. The purpose of the newsletter is to keep staff updated on the latest financial reporting news, alerting staff of changes and developments that may impact their work, and provide enough information to staff to satisfy the following:

• For staff to understand the nature of the news / change / development and its potential impact (so staff can decide whether they need to investigate further given the nature of their own work);
• Provide directions to staff of where they can access further information on the news / change / development if they wish to (including website links where appropriate).

Required:

Prepare a 2 page newsletter that identifies and summarises changes / developments and news in the financial reporting environment for the observation period from 1 March 2020 to 31 July 2020, inclusive.

Detailed guidelines for completing this task:

1. Identification of changes and developments

Your newsletter will require you to undertake extensive research on a number of sources over the observation period required above. You will need to identify and consider a range of developments/changes such as:

• Technical issues: for example the issue of new accounting standards, amendments to accounting standards, updates on AASB or IASB projects in progress, amendments to ASX listing rules related to financial reporting. Any pronouncements which became effective outside of the observation period may be included only if news in relation to that pronouncement is published within the observation period. For example, AASB's research report published on 1 April 2020 (within observation period) about the impact of new leasing standards which became effective from 1 January 2019 (outside observation period but could be included in your newsletter). So, the determining factor on whether a news is to be included in your newsletter is the publication date of the news, not the effective date of the accounting standards.
• Regulation and monitoring of financial reporting: for example ASIC reviews on financial reporting.
• Political influences or other potential developments. 'Political' does not only mean action from politicians it would also include lobbying/actions by other groups to promote their own interests for example, there may be articles about companies, or particular interest groups such as Group of 100, saying that if certain accounting standards are introduced this will disadvantage or have a negative impact.

You will need to consider both local (Australian) and international sources and developments which are relevant to your targeted audience.

The restriction of a 2 page newsletter means that you need to use your own judgment as to whether to include information about specific news items and changes / developments, and how much information to include. It is not intended that you provide complete details of changes / developments (although you may consider that more detail is needed in particular cases).

Given the target audience, it would be assumed that they have a working knowledge of common terms and abbreviations (such as AASB, IASB), so abbreviations may be used.

What not to consider?

You need to take care that the news / changes / developments included in the newsletter are relevant to the objective, in particular that they relate directly to the preparation of general purpose financial reports for large companies listed on the ASX. The newsletter should not consider areas only indirectly related to the preparation of financial reports such as (this is not an exhaustive list):

• Fraud
• Auditing
• Taxation
• Other disclosures by listed companies such as: industry disclosures required by peak organisations, and voluntary disclosures in the area of corporate social responsibility or integrated accounting.

2. Potential sources

Given the scope of the potential influences on financial reporting, you will need to research a range of sources. Below is a list of sources that may be of interest. Note that this list is not exhaustive, students should search for sources outside of these. Students should not rely on any one type of source, but a range of sources from each category, i.e. do not just look at websites, also check journals, newspapers etc. Examples of possible information sources include:

(a) Websites such as those of:

• Australian Accounting Standards Board
• Financial Reporting Council
• Australian Securities and Investment Commission
• Australian Securities Exchange
• International Federation of Accountants
• Chartered Accountants Australia and New Zealand
• CPA Australia
• International Accounting Standards Board
• Websites of large accounting firms
• IAS Plus - Deloitte

(b) Professional publications:

• In the Black (CPA)
• Acuity (CAANZ)
• Accounting Futures Magazine (CAANZ & ACCA)

(c) Newspapers/journals

3. Format and presentation

The following are to be observed for your newsletter preparation.

• The top of the newsletter must include the title (you need to decide what to call your newsletter) and details of the period the newsletter is considering.
• The newsletter should not read as one continuous 'essay'. It must include headings and sub-headings that assist in identifying the nature of news / changes / developments and help to guide the reader, and also enable the reader to distinguish between items of interest and the relative importance of changes.
• You must refer the reader to specific sources (including website links where appropriate) so that they are able to obtain more detailed information of the news / change / development. If you include direct quotations in your newsletter, you need to include in-text citations using the APA 7th edition format.
• The newsletter must be printed in minimum font set at 11 points (you may wish to use different formatting (such as larger fonts) for headings. Apart from minimum font size, there are no specific requirements in relation to line spacing, margins. However, you should note that simply reducing line spacings or margins to 'fit more in' may impact on the presentation and effectiveness of the newsletter and therefore impact on the marks awarded to you for presentation.
• There is no specific 'word limit'. The newsletter must be no longer than 2 pages. In cases where the newsletter exceeds the 2 page limit, only the first 2 pages will be marked.
• Do not attach actual articles/printouts of web sources etc to your assessment. You are only required to include details of these in the bibliography (see section 4 below).

Don't be afraid to be creative. The effectiveness of a newsletter is impacted by how interesting the readers find it.

4. Bibliography and referencing

This assessment must include a bibliography using the APA 7th edition, rather than a reference list (this should not be part of your newsletter and is to be given on a separate page). A bibliography includes all materials used/read in the preparation of your assignment, not just those referenced or cited within the paper. The reason a bibliography is required (rather than a reference list) is that this will provide an insight into the range of your research activities which is part of the criteria for assessment. It is expected that the bibliography will be quite long. The bibliography needs to include specific articles or readings that you have actually accessed - not just a general link to a website or newspaper etc. Therefore if you use a source such as the AASB website, please reference every article that you have read separately. You should only include sources that are related to the area of interest. For example, if you look at a particular publication but most of the content relates to taxation or auditing issues, it would not be appropriate to include these articles in your bibliography as these are not directly related to the area of interest.