1、The Framework of FRS1. Financial Accounting Standards Board (FASB)2. The Statement of Financial Accounting Standards (SFAS)3. Generally Accepted Accounting Principle(GAAP)Standard-setting bodies 1. International Accounting Standards Board (IASB)2. The International Accounting Standards (IAS)，The Int
2、ernational Financial Reporting Standards (IFRS)3. IFRSDesirable attributes of standard-setters:1. Observe high professional standards.2. Have adequate authority, resources, and competencies to accomplish its mission.3. Have clear and consistent standard-setting processes.4. Guided by a well-articula
3、ted framework.5. Operate independently while still seeking input from stakeholders.6. Should not be compromised by special interests.7. Decisions are made in the public interest.Regularly authorities The Securities and Exchange Commission (SEC) in the U.S. The Financial Service Authority (FSA) in th
4、e U.K. Most national authorities belong to the International Organization of Securities Commissions (IOSCO)A core objective of IOSCO is to ensure that markets are fair, efficient, and transparent.IOSCO are to:(1) protect investors; (2) ensure the fairness, efficiency, and transparency of markets; an
5、d(3) reduce systemic risk, and it has a goal of uniform financial regulations across countries.Barriers to developing one universally accept set of financial reporting standard： 1. Different standard-setting bodies and the regulatory authorities of different countries can and do disagree on the best
6、 treatment of a particular item or issue.2. Political pressures that regulatory bodies face from business groups and others who will be affected by changes in reporting standards.IASB conceptual frameworkFundamental principles for preparing F/S: AA CC FG MN R1. Going concern basis2. Accrual basis of
7、 accounting 3. Fair presentation4. Consistency5. Materiality：free of misstatements or omissions，重大性，重大的才是相关的6. Comparative information7. Aggregation：Aggregation of similar items and separation of dissimilar items.8. No offsetting，不允许相互抵消9. Reporting frequency： Coherent financial reporting framework：
8、1. Transparency； 2. Comprehensiveness； 3. ConsistencyBarriers to creating a coherent financial reporting framework：1. Valuation； 2. Standard setting： “principles-based“ approach （IFRS） ； “rules-based“ approach （GAAP） ；“objectives-oriented“ approach；3. Measurement： “asset/liability“ approach； “revenu
9、e/expense“ approach；GAAP 与 IFRS 的区别framework IASB：lists income and expenses as elements related to performanceFASB：Revenues, expenses, gains, losses, and comprehensive income.defines an asset IASB：a resource from which a future economic benefit is expected to flowFASB：future economic benefit， uses t
10、he word probablevaluation FASB：does not allow the upward valuation of most assets.revenue recognizedIASB：For sale of goods, revenue is recognized when:1. The risk and reward of ownership is transferred.2. There is no continuing control or management over the goods sold.3. Revenue can be reliably mea
11、sured.4. There is a probable flow of economic benefits.5. The cost can be reliably measured.For services rendered, revenue is recognized when:1. The amount of revenue can be reliably measured.2. There is a probable flow of economic benefits.3. The stage of completion can be measured.4. The cost incu
12、rred and cost of completion can be reliably measured.FASB：realized or realizable, and earnedSEC: 1. There is evidence of an arrangement between the buyer and seller.2. The product has been delivered or the service has been rendered.3. The price is determined or determinable.4. The seller is reasonab
13、ly sure of collecting money.B/S format IFRS 和 GAAP 都要求分别列示 current and noncurrent assets and liabilities。 IFRS 允许公司选择使用 liquidity-base format，主要用于 banking industryFinancial position Financial performance Change in financial positionThe balance sheet The income statement The cash flow statementAssets
14、 = liabilities + owners equityRevenue - Expenses = Net incomeOperating cash flowsInvesting cash flowsFinancing cash flowsNet cash inflow or outflow for the financial yearIS 表也被叫做 PL 表,profit and loss 财务比率一般是：存/存，流/存，流/流五大财务报表The balance sheet a point in time.Owners equity is the residual interest in
15、 the net assetsThe income statement over a period of time.The cash flow statement Operating cash flows include the cash effects of transactions that involve the normal business of the firm.Investing cash flows are those resulting from the acquisition or sale of property, plant, and equipment; of a s
16、ubsidiary or segment; of securities; and of investments in other firms.Financing cash flows are those resulting from issuance or retirement of the firms debt and equity securities and include dividends paid to stockholders.The statement of comprehensive income综合收益表reports all changes in equity expec
17、t for shareholder transactionscomprehensive income = other comprehensive income + Net incomeUnder IFRS： Income statement can be combined with “other comprehensive income“ （其它综合收益）and presented as a single statement of comprehensive income. Alternatively, the income statement and the statement of com
18、prehensive income can be presented separately.Under U.S. GAAP: firms can choose to report comprehensive income in the statement of shareholders equity.The statement of changes in equityThe statement of changes in equity reports the amounts and sources of changes in equity investors investment in the
19、 firm over a period of time.historical cost the amount originally paid for the asset 最初获得资产的时候花了多少钱会计的基本原理是历史成本amortized cost historical cost adjusted for depreciation, amortization, depletion, and impairmentD/A=折旧（有形资产）与摊销（无形资产，如专利） ，depletion 是矿产方面的current cost the amount the firm would have to pa
20、y today for the same asset如果今天买要多少钱realizable value the amount for which the firm could sell the asset 今天卖能卖多少钱，卖可能会有成本费用，即可实现净值present value the discounted value of the assets expected future cash flows 未来现金流的折现Measurement of financial elementsfair value the amount at which two parties in an arms-l
21、ength transaction would exchange the asset公允价值，非关联方的交易，充分信息交易，不一定是公允价值，所以要 arms-length transactionOther relevant informationFinancial statement notes (Footnotes)注解Are audited1. accounting methods, assumptions, and estimates 会计方法，会计假设和会计估计2. business acquisitions or disposal 收购兼并，资产处置3. legal actions
22、 法律行动4. employee benefit plans 员工福利计划 会兼法员客关公5. significant customers 重要客户6. sales to related parties 关联交易7. segments of the firm 公司分部Supplementary schedules补充信息1. Operating income or sales by region or business segment2. Reserves for an oil and gas company 石油储备3. hedging activities and financial in
23、strumentsManagements Discussion and Analysis (MD 资产被充公 2. Gains or losses from early retirement of debt; 最好补充说明：不准备提前还的债务，被提前还造成的利得或损失 3. Uninsured losses from natural disasters. 没被保险所 cover 的自然灾害损失，最好补充说明：是极罕见的灾害=Net Income 原本 Accounting changes 放在 I/S，现在放在了 footnotes，主要是包括： 1. Accounting principle
24、 (=accounting methods, might be retrospective). 追溯 2. Accounting estimate (prospective and not a below line item). 不用追溯 3. 之前有 error 的，要 restate financial statement; Notes disclosure.+Other Comprehensive Income1. Foreign currency translation2. Minimum pension liability adjustments 3. Unrealized gain
25、s and losses from cash flow hedging derivatives4. Unrealized gains and losses from available-for-sale5. （IFRS 独有）certain changes in the value of long-lived assets that are measured using the revaluation model rather than the cost model=Comprehensive Income收入确认方法Revenue recognition methods Implicatio
26、ns Differentsdelivery methodIf cash is received before providing, revenue is not recognized until it is earned z IASB:1.risk and reward of ownership is transferred2.no continuing control or management3.revenue can be reliably measured4.probable flow of benefits5.cost can be reliably measured FASB: 1
27、.realized or realizable；2.earned SEC: 1. Product has been delivered or service has been rendered.2. evidence of an arrangement3.The price is determined or determinable4.reasonably sure of collecting moneyPOC(Percentage of completion method)1. contract, and2. Reliable estimates of the revenues, costs
28、 and completion time. IFRS 和 GAAP 是一样的 通过成本比例确定收入 对于这些计账方法，都不会影响 total cash flow，只有一个例外，就是 LIFO 和 FIFO Percentage of Completed = Costs Incurred /Total Costs Anticipated 100% Gross Profit = %Complete Future Anticipated Profit Profit Already RecognizedLT contract长期合同CC(Completed contract method)1.no c
29、ontract, or2.estimate of revenues/costs are unreliable 开始 profit 都算 0，最后一起确认成本和收入 只有美国才有 CC，在 IFRS 中，费用发生就计 revenue,有多少费用就计多少 revenue，所以在成本收回来前，NI 都是 0，有点像 cost recovery，但 profit 仍然只是到完成的时候才会有。所以 IFRS 的 CC 就与 cost recovery 差不多Installment sales method1.no way to estimate the likelihood of collecting
30、the proceeds, but2.costs are knownInstallment contract分期付款法 Cost recovery method1. Costs are not known, or2. Uncertainties collection of the proceeds. 收钱的可能性收大到小：sureno way to estimateUncertainties Installment sales method：通过收到的钱确定成本，在 GAAP 中不要求折现，在 IFRS 中要求折现，计算 discounted present value,差额计入 intere
31、st Cost recovery method：收到的钱覆盖完成本后，再算收入；这个方法中，GAAP 与 IFRS 差不多Barter Transactions以货易货1. two parties exchange goods or services without cash payment.2. A round-trip transaction involves the sale of goods to one party with the simultaneous purchase of almost identical goods from the same party. The und
32、erlying issue with these tr GAAP： Revenue from a barter transaction can be recognized at fair value only if the firm has historically received cash payments for such goods and services and can use this historical experience to determine fair value. IFRS：Revenue from barter transactions must be based
33、 on the fair value of revenue from similar no barter transactions with unrelated parties.ansactions is whether revenue should be recognized. EPS for publicly-traded firms (nonpublic companies are not required to report EPS data) EPS is reported only for shares of common stock (also known as ordinary
34、 stock).Basic EPS基本每股收益Basic EPS = weighted average number of common shares outstanding 加权平均的股份数： New issue, repurchase is weighted by time (days or months); 发行新股要算时间加权，考试用月 Stock dividend 股票股利 Operating profit margin; Pretax margin; Net profit margin; Return on assets; Operating return on assets; R
35、eturn on total capital; Return on equity; Return on common equity2. Total asset turnover; Fixed asset turnover; Working capital turnover; Inventory turnover; Receivables turnover; Payables turnover; Operating cycle; Cash conversion cycle; 3. Current ratio; Quick ratio (acid-test ratio); Cash ratio;
36、Defensive interval; 4. Debt-to-equity ratio ; Debt-to-capital; Debt-to-assets ; Financial leverage ; Interest coverage; Fixed charge coverageProfitability Ratios1.分母是 revenue = = = = 2.分母是 Capitalassetequity ()= + (1) = () = () = = ( ) Activity Ratios = = = = = 1、 = = 365 2、 = / = 365 3、 = / = 365 O
37、perating cycle = inventory period + collection period Cash conversion cycle = inventory period + collection period - payment periodLiquidity Ratios(ability to pay short term debt) = ( )= + + = = + = ( + + ) Solvency Ratios (ability to pay long term debt) = = (+ ) = = = = ( + ) ( + )严格来说，capital 不等于
38、asset， capital = Long-term debt + short-term debt + equity Liability 包含了 debtLeverage ratios focus on the balance sheet by measuring the amount of debt in a firms capital structure. For calculating these ratios, “debt” refers to interest-bearing obligations. Non-interest bearing liabilities, such as
39、 accounts payable, accrued liabilities, and deferred taxes, are not considered debt. Valuation RatiosP / E = Price per share / Earnings Per share P / CF = Price per share / Cash flow per shareP / S = Price per share / Sales per shareP / BV = Price per share / Book Value per shareSustainable growth rate =( 1 )=( 1 ) g: 可持续增长率； RR：股利留存率； 这是股利支付率 DuPont system of analysis1、The three-part approah (Nal)=( )()(
