Accounting standard-setting model: theoretical overview and analysis of new ideas

[Abstract] article on the accounting standard-setting model to sort out, summed up the development of basic accounting standards, accounting standard-setting body, and accounting standard-setting procedures for Research on existing studies of the key issues are described, made use of evolutionary economic theory accounting standard-setting model of new ideas.

[Keywords] Financial Accounting Standards, the development of a basis for devising the main, to establish procedures

I. Introduction

Financial Accounting as an independent emergence of the concept in the 1930s (more precisely, is "generally accepted accounting principles" appears, so far has been the development of Financial Accounting seventy years is worth noting that, an overview of the development of modern Financial Accounting, found in Financial Accounting, once produced, on with the financial accounting and accounting information disclosure standards and control go hand in hand (Ge Shu, Du Xingjiang, 2003 Accounting Standards as the accounting information disclosure standards, financial accounting Research an important aspect of financial accounting of the development process but also for the pursuit of the development process of high-quality accounting standards from the 1930s onwards, has begun to study abroad, accounting standard-setting issues, China since 1951, launched a highly unified accounting system. accounting principles, accounting standards and other terms in our textbooks disappeared nearly 30 years until the late 1970s, China began to discuss the accounting profession to re-accounting principles (Ge Shu, Liu Feng, 2003. Liu Feng (1996 through early complete theoretical framework of accounting standards develop a systematic comprehensive study for development of accounting standards mode by a variety of different angles from the standard to define, such as the right of ownership to develop accounting standards, the development of the choice of agencies to develop the detail of content, makers of the source composition the development process of open independence, etc. But in general, the accounting standard-setting model of Research involves the development of basic accounting standards, the development of the subject and to establish procedures in three aspects.


Second, the accounting standard-setting based (oriented

Basis of accounting standard-setting, also known as accounting standard-setting guide, involved in the accounting standards within the accounting policy choice, so the issue has been the accounting profession, practitioners and other focus of the parties in foreign countries, bias view is the basis of accounting standards than rules-based accounting standards. Mason, Gibbins (1991 that, in principle-based accounting standards in general superior to rules-based, and help to improve the quality of accounting information, if accounting standards are rules-oriented , those who expect to obtain self-interest on accounting standards, the organization, there can be "measures" the objectives and methods (Lys, Vincent, 1995.1997 December "AAA / FASB Conference", the U.S. accounting profession on behalf of John Smith first proposed the "criteria based on the concept" (Concept-based-Standards to say, and that the conceptual basis of the guidelines than rules-based criteria (Rule-based-Standards.Engle (1999 elaborated manager use of accounting standards in the form of behavior to avoid real economic transactions, his Research found that managers through fictitious transactions will be the liability should be recognized items recognized in equity, resulting in a $ 4.3 billion in costs.

Enron, the accounting standards of foreign principles and rules-based studies are numerous. It is worth mentioning: Nelson et al (2002 survey by the Research concluded that practitioners, including the company accountant, certified public accountants prefer specific accounting standard. Dye (2002 study further confirmed that the Nelson's view that rules-based accounting standards due to increased management control and accounting reports the results of chance and make it less effective. Nelson (2003 through the management of listed companies and auditors The survey concluded that more specific accounting standards, the more likely the management of earnings manipulation by the transaction. Webster and Thomton (2004 to the Canadian capital market, for example, found that the principles-based accounting standards and the accounting professional judgments given space help to improve the quality of financial reporting earnings.

China's accounting standard-setting scholars on the basis of accounting discussed primarily in Enron. Ge Shu (2002 basis of accounting standard-setting gave a general description of him that development of a high-quality accounting standards, the guiding principle is recognized by the United States to develop accounting principles (GAAP) followed by the detailed "rules-based", or in accordance with International Accounting Standards Board (IASB to develop International Financial Reporting Standards (IFRS followed by simple "principles" is a controversial and must be repeated practice to answer questions.

On "basic principles and rules which better" a lot of discussion of research literature, for example, to Lu Ping, Liu Feng, Leike Luo (2003 from self-interested economic man assumption, to infer: each self-interested economic man In the process of implementation of accounting standards is always trying to maximize their own interests, if the criteria is the rule-oriented, suggesting that those who hope in the use of accounting standards in the personal gain of people have a way to draw upon, if not the adoption of principles-based given specific policy limits when there is a conflict of interest, we can only demand ethical conduct, which is obviously contrary to the basic economic premise of economic self-interest, long-term effectiveness of the degree of concern due to the development of principles-based accounting guidelines have not been implemented in the United States to predict the effectiveness of the method is too early to draw principles and rules of the advantages of goal-oriented development of China's accounting standards (Lu Deming, Chiu Yu-fang, 2003, Qiuzong Shun, Li Li, 2004 Lin Zhong high, HAN Li-jun, 2005, Company Secretary, 2005, they believe that the guidelines need to be goal-oriented financial report preparers, certified public accountants, the Audit Committee to implement the appropriate professional judgments, to determine the atmosphere of breeding career, and financial reporting and the need to change audit-related legal framework of the system, need to address standard-setting procedures and methods of accounting standards system in question, SEC's "goal-oriented" model for the optimal development of the practice has yet to be tested, but also learn the principles and rules advantages to target the core development of China's economic development compatible with the criteria for this line of thinking is desirable from the accounting regulatory perspective, Hong Jian Qiao, Lou HE President (2004 proposed accounting standards-based and accounting regulation of the effectiveness of related Standards-based accounting changes should be specific to adapt the regulatory environment in the relatively weak accounting regulatory environment, selection rules based accounting standards based on political science perspective, tension, high-Chen Hsu (2007 analysis of the U.S. Accounting Reform Act of 2002 The tendency of political opportunism, and from the International Financial Reporting Standards endogenous development oriented, the formation mechanism of accounting standards and financial responsibility to identify fraud and other perspectives of China's current accounting standard-setting guide the choice of that rule-based accounting standards in a fairly long historical period has a reasonable existence.


Third, the accounting standard-setting body

Accounting standards-making body is the accounting standards setters, structured makers facilitate the development of high-quality accounting standards. Tend to support study abroad by the accounting profession to develop accounting standards. Carey (1969 that the United States early railways and public utilities accounting for government regulation did not result in more reliable financial statements and accounting practices of unregulated businesses there is a greater degree of improvement, therefore, its opposition to the Public Company Accounting rule-making power given to the Federal Trade Commission The government regulatory agencies. to GeorgeMay led, with the cooperation of special committees of the New York Stock Exchange (Aspecial Committee on Co-operation With Stock Exchanges1932 stock market to the Commission in a letter, the letter suggested the New York Stock Exchange listing request The company follows the basic principles that should be included by the company managers, lawyers, accountants and other experts from the Commission after the study to determine (Zeff, 1972.Nolan (1972 that a large number of rules must be such institutions as the FASB to develop. Most ( 1986 suggested that accounting standards should be developed by a research organization, an appropriate research organizations should include the academic talents, and get the profession and industry funding, of course, the research organizations to develop accounting standards should be Institute of Chartered Accountants of receiving support or reject. Links to free download http://www.hi138.com China's accounting standard-setting body for the majority of studies do not support the full by the Government and relevant agencies to formulate accounting standards. Accordance with the "veil of ignorance" requirement: standard-setters should be no self-interest requirements of the non-stakeholders (Xue Yunkui , 1999, Chen Donghua, Chen Hsin-yuan (2003 to Fountain case study of the stakeholders in the process of China's accounting standard-setting role that accounting standards not only technical issues, and is related to the interest of the political issues of interest stakeholders should be involved in accounting standard-setting based on game analysis, high-Lin Zhong, HAN Li-jun (2005, high-Yun Yan, Lu Rui (2005 pointed out that the standard-setting power in a strong position in the game, the right to contract accounting standard-setting should be configured government-led, non-governmental organizations to assist the binding mode. QI good East, Yang Zhiqiang (2003, Wu Lian-sheng (2004 empirical survey data showed that respondents generally in favor of the stakeholders involved in formulation of accounting standards, social broad participation in development of accounting standards , is greater fairness to improve accounting standards, foundation Wang Jianxin (2001,2005, Zhang Jiaxing, Zhang Junmin (2006, Song Yinghui, Gao Ming (2007, Li Ning (2007, Gui-Rong Li (2007, high-Lin Zhong, Xu Rainbow (2007, respectively, accounting standard-setting power from the perspective of the game, lobbying perspective, creative accounting perspective, the entropy theory perspective on accounting standard-setting body for the study, its findings also show that stakeholders should be more widely involved in accounting standard-setting.

However, Liang Shuang (2005 to use the theory of property rights economics, analysis of effective accounting standards-setting bodies should have the authority, efficiency and fairness characteristics, obtained China's accounting standard-setting bodies (the Ministry of Finance Accounting Division) is an effective accounting standard-setting bodies conclusions. Hao Liu, Zheng Sun (2005 companies from the ownership of the new institutional economics theory, the accounting standard-setting power vested economic interpretation put forward in order to curb managers' control over specific income ", the government has a accounting standards-making power, while the manager has only within the framework of accounting standards in the accounting judgments made by the right.


Fourth, the accounting standard-setting process

Accounting standard-setting process refers to the procedures to be followed accounting standards, accounting standards in the development process if we can observe a complete, full, tight and stable procedures, guidelines to develop independence, fairness and openness can be guaranteed. China scholars to discuss the accounting standard-setting process, the purpose is to ensure that accounting information stakeholders to effectively participate in the formulation of accounting standards in order to develop high-quality accounting standards.

FASB and IASB in the drawing procedures to be followed accounting standards, based on the July 10, 2003, the Ministry of Finance issued the accounting standards setting process in China, since China's accounting standards setting process into project stage, the drafting stage, open the comment period and the release phase, but some scholars have also suggested that this be further improved. to comply with an open procedure to be followed for the proposed project's publicly discuss the draft guidelines or hold hearings, and related issues, principles and methods, all of the relevant theory to be open, in the development process to maximize the participation and interest groups to express their views (Qiuzong Shun, Han Hong Ling, 2003. accounting standards-setting process has privacy features (Chen Ping, 2006, China's accounting standards drafting development of the whole process in terms of the general public are confidential, the lack of many comments link, standard-setting process for background material and discussions are rarely disclosed to the outside world, which have an incentive to participate in the standard-setting stakeholders have been shut out, so standard-setting bodies should develop appropriate procedures for open standards to facilitate the development of the public to join the discussion based on the evolution of economic theory, high-Lin Zhong, XU (2007 proposed the establishment of accounting standards, draft feedback system, so accounting standard-setting to listen more to their opinions and these results show that the literature open to stakeholders the extent of accounting standard-setting process is still insufficient.


V. Conclusions and research ideas

High-quality financial reporting is the goal of financial accounting, and high-quality financial reporting requirements of high-quality accounting standards, therefore, the accounting standard-setting is the eternal theme of financial accounting research, although international accounting standards-setting model has made a lot of research and the formation of a number of research results, but so far no country or international organization can provide the perfect accounting standards of financial accounting reports, which shows that the accounting standard-setting model of research will continue.

Economy continued to move forward, new situations and new problems have emerged along with accounting standards will require the evolution of accounting standards is a dynamic process, but the neo-classical economics to atomistic and mechanical analysis for the metaphor of the static equilibrium method and not a true representation of the basis of accounting standard-setting, the main interaction between procedures, it does not reflect changes in the external environment influence the development of accounting standards, therefore, difficult to use traditional methods of institutional economics to the accounting standard-setting dynamic analysis for the dynamic evolution of economic theory is the analysis of the evolution process, as a basis of accounting standard-setting model study will be a new research ideas.

[References]
[1] Ge Shu, Liu Feng, from the nature of accounting standards, see the formulation of accounting standards [J]. Accounting Research, 1996 (2.

[2] Lu Deming, Qiu Xingfang. Accounting Standards: Principles-based or rules-based [J]. Finance Essays, 2003 (1.

[3] Hong Qiao Jian, Lou HE system. GAAP accounting guidance and supervision of an economic game analysis [J]. Accounting Research, 2004 (1.

[4] Chen Donghua, Chen Hsin-yuan of Chinese accounting standards developed in the interests of coordination: evidence from the Fountain of cases [J]. Accounting Research, 2003 (6.

[5] Chen Ping. The system of accounting standard-setting game thinking [J]. Financial Theory and Practice, 2006 (3.

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