1.1 ACIS211Week1BM_Lecture_one

1.1 ACIS211Week1BM_Lecture_one - ACIS211Lectureone...

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    ACIS211 Lecture one NZ Reporting environment
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    Objectives Describe different types of companies Discuss basic reporting requirements for  companies Learn where reporting requirements come  from Consider the NZ Framework
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    Issuers An issuer has offered and issued shares to the  public s33 of the Securities Act 1978 requires issuers to publish  a registered prospectus The prospectus must disclose all relevant details for the  issue of shares and financial affairs of the company
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    Non-Issuer  Shares owned by a restricted group of  people  Not available to the public
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    Listed or Non-listed  Listing on a stock exchange allows for third  party trading in the shares of the company  Listed companies must comply with the  rules associated with their exchange
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    Financial Reporting Act 1993 (FRA) Purposes :  Prescribes Financial Reporting  Requirements for different entities  Establishes Accounting Standards  Review Board  Gives legal force to approved  accounting standards
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    Financial Reporting Act 1993 (FRA) Main provisions: 1. Defines an “ entity”   for the purposes of  the Act as:  All Issuers and All companies.   An issuer is any organisation which makes a public  issue of  debt  (eg debentures) or  equity  (eg shares). A company is an organisation registered with the  Registrar of Companies 2. Distinguishes different types of entities –  Reporting, Exempt and Public sector  entities
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    Financial Reporting Act 1993 (FRA)   (cont) 3  All entities must prepare financial statements  annually (s10) 4 Reporting entities and exempt companies have  different financial reporting requirements 5 Financial statements of  reporting entities  must  (s11): (a)   Comply with GAAP (Generally Accepted  Accounting Practice) & (b)   Show a True and Fair View
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    Financial Reporting Act 1993 (FRA)   (cont) 6. Financial statements of  exempt companies  must be Prepared in accordance with the Financial Reporting Order  1994 (FRO) which contains a simplified prescription for the  financial statements (s12 of FRA). There is no True & Fair View/GAAP requirement (however the  Financial Reporting Order implicitly requires the reports to be  based on GAAP) 7. The functions of the Accounting Standards Review Board  (ASRB) are: To review and approve financial reporting standards To give directions for accounting policies that have  authoritative support within New Zealand 
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    Financial Reporting Act 1993 (FRA)   (cont) 1.
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