Finance – Page 6 – Deuts.NET

Searching Conrado Valix

Yeah, sounds like a movie (Searching Bobby Fischer). I should have changed the title to “Googling Conrado Valix”. Nah, nevermind.

I was wondering of late why there were just too many people who maybe were lost in the cyberspace and found their way to my entry regarding the Financial Accounting I, 2006 Edition by Atty. Conrado Valix and Jose Peralta. These visitors are mostly students from schools in different parts of the country (Philippines), who are (maybe) fanatics of Atty. Valix (okay, I am a fan myself). My blog was even mistaken for a fan site or something like that.

Then, I tried googling for the keyword “Conrado Valix” and guess what I discovererd:

Google – No. 1 in the search result page.
Yahoo! – No. 1 in the search result page.
MSN – No. 3 in the search result page.

Refining the search query yielded in a more interesting result. For a keyword “Financial Accounting by Conrado Valix”, my site ranked simply number one in all the big three search engine sites! (Note that these results change over time)

So that explains it, huh!

That should surely explain The J Spot’s entry on “Why Celebrities Should Blog“. He also cited another reason here.

Conrado Valix, being a public figure especially to accountants from college students to professionals, should start blogging. By this manner, it will pave the way at which students and professionals alike can contact him. It can be a ground where he can solicit feedbacks from readers of is “renowned” books on accounting.

Nonetheless, it’s even more ironic to note that CPAR (CPA Review School of the Philippines), being an established institution in the world of Filipino Accountants where Atty. Valix is one of the founders and the current director, doesn’t have a website (I think I’ve already said before). It’s one of the review centers that has produced and is still producing the best accountants in the country (or maybe even in the whole world), and yet it doesn’t yet have a space in the world wide web. (Or maybe it has, but it was not just optimized for search engines, I don’t know. If that’s the case, time to hire an SEO professional.) Imagine just how many students are maybe searching for its site everyday. Thus, maybe lost reviewees (and revenue).

Access to internet nowadays are becoming more widespread and cheaper. One should really reevaluate its marketing strategy.

(What do you think Domeng? –if you read this post)

The Difference Between IFRS and IAS

This is the question that oftentimes pops up from a middle of nowhere…

What basically are the differences between the International Financial Accounting Standards (IFRS) and International Accounting Standards (IAS)? Or, should we rephrase the question, are there any differences at all?

Well, there are differences, of course. And the major difference is that the IAS’s were issued by the International Accounting Standards Committee (IASC) from 1973 to 2001, while the IFRS’s were issued by the International Accounting Standards Board (IASB) from 2001 onwards. The IASB is basically the successor for IASC.

When IASB was installed in 2001, it adopted the existing IAS and decided to name any future standards as International Financial Reporting Standards. Consequently, IAS 1 Presentation of Financial Statements defines IFRS as standards and interpretations adopted by the IASB.

Now, IFRS in a broad sense comprise:

Framework for the Preparation and Presentation of Financial Statements – stating basic principles and grounds of IFRS
International Financial Reporting Standards (standards issued after 2001)
International Accounting Standards (standards issued before 2001)
Interpretations originated by the International Financial Reporting Interpretations Committee (IFRIC) or the former Standing Interpretations Committee (SIC)

In My Humble Opinion (IMHO)

I have to be explicit that these are just my opinions. If you trust it, then thank you. If not, then make your own research! (LOL!)

So the new IFRSs standards are in addition to (on top of) the IASs, won’t there be any contradicting standards/principles between the two as a result of the adoption of IFRS?

Just as the former IASC altered some of its provisions and withdres some IAS numbers from its set of standards over the years, any contradicting principles from the new IFRS will supersede that of IAS. One basic example is the IFRS 3 and IAS 22, which are both titled, “Business Combinations”.

Of course, there are standards in the IFRS that provide rule over some grey areas or a “no mention” in the IAS, just like the identification, measurement, presentation and disclosure of non-current assets held for sale (IFRS 5).

In fact, when contradicting standards are issued, the older one is removed from the complete set of standards. Look at the latest complete list of standards and IAS 22 is not there anymore.

I have been full compliant with IAS in the previous years, do I still have to apply IFRS 1 (First Time Adoption of IFRS), and thus present comparative information and other disclosures required by IFRS 1 in my next financial statements?

Under the Scope of the standard, paragraph 3, if you have not stated compliance with IFRS in an “explicit” and “unreserved” statement in any of your previous financial statements, then you have to comply with and follow the disclosure requirements of IFRS 1. If you have been full compliant with IAS, then preparing the disclosure requirements of IFRS 1 would not be that cumbersome.

Conclusion

Try googling for the difference between IFRS and IAS, and it will lead you nowhere. I mean, basically there are no resources in the internet that can give you a precise distinction between the two. Such question just seems like improper. It’s like comparing a chicken against an egg, when in fact the former just simply evolved from the latter. You can’t plainly make a head-to-head comparison.

Remember, comparing IFRS vs. IAS is not like comparing IFRS vs. US GAAP. The latter is completely a different story.

Some Business News

Here are some interesting finds in digg as regards business and finance news, from the legality of SOX (Sarbanes-Oxley Act) to the girls of Hooters.

Is SOX unconstitutional?

Sarbanes-Oxley is totally unconstitutional says prosecutor Kenneth Starr. Starr, who led the charge on Whitewater and Monica Lewinsky, is now heading up the constitutional challenge to the Public Company Accounting Oversight Board which will be heard by the courts this week. (Read more)

Despite Controversy, Hooters Prospers

Having a brand image focused on staffers wearing less has meant more for the privately held company, which started in 1983. It’s blossomed into a chain that brings in $900 million in yearly sales and is expected to cross the $1 billion mark for the first time next year. (Read more)

Overtime Once Again

I’m just having my first taste of Doha overtime today. I thought when I get here in this place, in this foreign land, there’ll be no more overtime, I have to say goodbye to overtime, but then here I am 12:30 in the middle of the night here in the office! I guess it’s only “Goodbye, Obeertym!”

Just would like to report also that in the Popular Posts race, “Financial Accounting I 2006 edition” has just overtaken “Inventories at Net Realizable Values” for the number 1 spot. This is because of so many comments I received mostly from accounting students all over the country. The post must be becoming very popular in search engines for the keyword “Conrado Valix”.

That keeps me wondering, why CPAR (CPA Review School of the Philippines) don’t have a website? It should help more on their marketing campaign.

A Professional

Here’s a story I read somewhere I forgot where reflecting at how a professional is separated from a common worker.

A printing company calls in an engineer because their press is printing out of register. The engineer duly arrives, but instead of looking at the machinery, he looks at the print output.

Mmmm says the engineer. I know just what’s wrong here. He rushes out to his van to fetch a hammer.

Taking the hammer in one hand, the engineer strikes the press hard on the side, and the next piece of paper to emerge is perfect. That’s great says the printer, How much do I owe you?

That will be £500 replies the engineer.

What? asks the printer, You’ve only been here for five minutes!

Yes I know says the engineer. It’s £5 for the hire of the hammer…

… and £495 for knowing where to hit with it.

New Office Accounting Software

I have had small clients before that utilizes spreadsheets like mirosoft excel (or even worse, manual journals) to record accounting transactions, out of which they prepare financial reports.

Why not yet automated? There can be three possible reasons:

Their transactions can be very simple and volume of transactions very low that it renders more efficient to use spreadsheets rather than use any simple software (like a GL system) available in the market, to process those transactions;
They don’t have enough fund to invest in a fully licensed GL system; or
A conservative accountant who’s not willing to adopt the latest technology.

Sad to note, though, that the last reason is often the case for these companies, or maybe a combination of any or all of the three, but that the third is oftentimes present.

For companies that cannot afford a system, especially for those that are on the start-up phase yet, Microsoft has the latest (announced just this week!) special offer:

Continue reading New Office Accounting Software

GAAP and the Standards

Reviewing the prior year working papers, I found myself reading this documentation (and I’m quoting it verbatim):

At present time the client accounting department have no in place processes to identify significant changes in generally accepted accounting principles promulgated by relevant authoritative bodies , the client alternatively is to consult with the auditors regarding that and to consult with the group.

Relevant authoritative bodies like the IASB do not promulgate generally accepted accounting principles. Instead, they promulgate accounting standards based on accounting principles that will yield comparable results and reports among companies especially in the same industries.

Generally Accepted Accounting Principles (GAAP) are the principles developed and adopted through norms and thus generally accepted, while accounting starndards like the IFRS are a means to formalize and document such general principles.

The Accountant

The following movie is a spoof of an Arnold Schwarzenegger movie trailer. It is using youtube, so for those who have youtube blocked in their office internet, I’m sorry, I really can’t help you with that. I guess you might have to wait when you can browse through an open access internet. Yet, I really recommend that you watch this because it is very hilarious!

[youtube http://www.youtube.com/watch?v=sUx87Vt6Mbo]

Thanks to Tina Smith for referring this video to me.

Inventories at Net Realizable Values

The introduction of International Accounting Standards (IAS) and International Financial Reporting Standards (IFRS) ushered in more disclosure requirements in an entity’s financial statements. Oftentimes, additional narrative explanation are required for a particular note item in the Notes to Financial Statements. Transparency in financial reporting, you say, huh.

IAS 2, Inventories, in particular, requires a company to disclose among others, the accounting policies adopted in measuring inventories, the carrying amount of inventories carried at cost and the carrying amount of inventories carried at net realizable value.

Complexities, however, arise when a company allocates a provision for inventories specifically identified as obsolete or are impaired, and in such a case are measured at net realizable values. Generalizing in the notes that “Inventories are stated at net realizable value,” (when in fact only a few distinguished items are affected) cast a serious hassle on the part of the reporting entity.

Continue reading Inventories at Net Realizable Values

After Ten Years

Back in high school, I was particularly ignorant on what path should I take. Everybody’s got a plan on what to take up in college, while I still wonder.

When we were given the application forms for the UP College Admission Test (UPCAT), I was browsing through the choices of courses I have. Basically, Diliman was not a choice. It would be too far away from home, and my parents won’t allow that. Therefore, I only have either the Iloilo City Campus or Miag-ao.

Frankly, I want it closer to the city. It would be where life really is. That’s why I’ve narrowed my selection to the Iloilo City Campus, which offered only Management courses. The Iloilo City campus is the home of the UPV College of Management. And the most viable course for me would be B.S. Accountancy.

Continue reading After Ten Years