FINANCIAL REPORTING AND PRICE CHANGE

FINANCIAL REPORTING AND PRICE CHANGE

(PELAPORAN KEUANGAN DAN PERUBAHAN HARGA)

There are two term in price swings to be understood as follows :

1. price changes common happen if on average price all goods and services in an economy undergo a change. Units monetary gain advantage or suffered loss purchasing power. Price increases overall called as inflation ( inflation ) , the subsidence price called as deflation ( deflation )

2. price changes specific reference to change in price goods or services certain caused by changes in demand and bidding. So inflation rate per year in a state may hover around 5 % , while prices one unit apartment with one bedroom may be inflated by 50 % over the same period

The impact of inflation to a company

The effects of inflation in the financial position and achievements of the company can be in inefficiency achievement by the decision of a manager who did not understand the impact of that. For example, if the business financial holding cash on financial assets during the period during which experienced inflation rate increase to 10 %, mean as much as 10 % of the ability to purchase end of the period of the commencement of inflation. The effects of inflation in assets nonkeuangan be reflected in the report, and the balance of payment of profit during periods of price increases, earnings from the sale of now be matched against their inventories was probably comes from the purchase of the monthly and against some calculation depreciation histori cost of land, building, and equipment purchases were from a few years ago, though true that inventories of replacing a fixed asset and can become more expensive.

Accounting alternatif size

In general the ability to purchase accounting according to include all sensorial system in maintaining the ability of a purchase as real capital or shareholder, equity in the company in accounting to make the exchange of common level of price. The present value according to accounting on the other hand, include all sensorial systems on the listing of the present value or changes in the price of specifically. By inserting akuntansibiayasekarang and replace the value of an accounting system , which basically means that maintains physical capital, production capacity, or operation of assets at company ; and spending ( now ) accounting or sale price, which shareholder means to keep but in a term applied to the sale price for net assets of the company .

The present value : forget accounting

Although we are talking about and forget the present value of accounting in vidual , the accountant and many economists believe that in accounting system combining both based on the real value.

International financial reporting standards

First reaction of iasc ( now iasb ) to accounting inflation in 1977 in the ias 6 , Accounting responses to changing prices. Iasc try to establish the standard major in abridgement choice who is and must first based on consensus about its members of an organization that ias 6 be very concise. International accountancy standards panitia believe that further experiment is necessary before it can provide consideration that is demanding company to claimed the financial report of the main , using a system that uniform and thorough to reflect a change of prices. Company financial statement that presents the main base charge at the principal matter will assist historical evolution to provide additional information that reflects the effect of the price volatility. The main types of information that reflects the effect of the price volatility recommended for the disclosure ias by 15 , that is,

1. A number of adjustment or adjust the amount of shrinkage hak milik , a factory , and equipment .

2. A number of adjustment or adjust the sum charged sales .

3. Adjustments related to post monetary , an effect in borrowing , or flower capital , at adaptations that as it has been be counted in determining income by method of accountant

4. A whole effect on the outcome adjustment as good as any other material reflect effect in changing prices reported under an accounting method adopted.

5. A method of cost now adopted , equipment and plant and inventories.

6. A method adopted counting information sue at in matter first , includes nature uses index .

Comparison national rules and practices

Practice accounting , inflation varying worldwide and to a consideration concerning level rates and inflation impact. Experience accounting inflation a substantial been obtained following hiperinflasi occurring most frequently in south america , especially in argentina , brazilian and cili.di england , profession accounting introduce ssap 16 in 1980. Officials withdraw ssap 16 in 1988 following deterioration criticism and tiers inflation of business. In the u.s. , regulation first introduced with the legal worn by the sec in 1976. Am ok and state disclosure current a charge required by sfas 33 in addition to the disclosure income that has been adjusted , supplies , plant and equipment it takes to be disclosure together by increase and decrease in costs now adjust for am ok.

Inflation accounting in south america

With hiperinflasi infesting in some recent years in several countries in south america , especially brazil and argentina , this is not mngejutkan pressures that there is to adopt systems inflation accounting. In brazil, the inflation adjustment accounting used in the early 1950s , but a regulation / law the new company in 1976, namely approach pengindeksasian common to give back fees historical under terms of purchasing power now as a date from the financial statement. All companies must give back the balance with respect to property, building, and fixtures and deprisiasi relating, investments, and expenses suspended and equity holders in argentina , inflation accounting system introduced especially passing initiative and intervening profession accounting. In 1972, a statement used as the main issues, recommended publication pelapaporan additional financial am ok. In 1995 , the terms of adjustment am ok moved following a period of inflation low.

Accounting value now in the netherlands

In dutch the people of holland conscious of value accounting now for a long time . Two reasons why focus on dutch if no requirement to cost now or of accounting am ok that is , first involving theory professor theodore limberg , often called adja theory value replacement because kepeloporannya work in holland the 1930s . He focus on the strong relations between economic and accounting and believes revenue should not produced without resources for business of income from a continuity or continuation. Income is a function of income and values replacement rather than expenses historical. In extra limberg maintain that information value must now used all the decision-making.

The second reason is to see at dutch to learn from experience from company philips multinational dutchmen who was a pioneer supplier financial report value now . Philips is so a nice example and valuable of application practice in accounting value now .

In a financial filing value now , philips use value now with the replacement process with penyesuian reflects the degree to which an additional advantage of financial assets of borrowing than capital equity .

Values now used by the department of purchase for asset fixed ; by the department permesinan to design the specifications equipment , and by building design and the department permesinan building to building buildings .