Question

QUESTION ONE The new Board of Directors of your company met with the external auditors to consider and approve the financial statements for the year ended 31st December 2019. Some of the directors have argued that the use of the accounting concepts, conventions, standards/principles and the underlying assumptions issued by the International Financial Reporting Standards (IFRS) and adopted/applied both by the Institute of Chartered Accountants (Ghana) and your company in the preparation of the financial statements is waste of time and resources and have outlived their usefulness as they provide little or no room for management and accountants some flexibility in treating certain items/transactions in their own way in the financial statements as well as their inclusion in the Auditor’s Management Letters under the heading “deficiency”. You are the only accountant among the seven (7) member board of directors and serves as a chairperson of the Finance and Administration Committee. REQUIRED: Write a report to the Chairman of the main board of directors of the company discussing the sentiments of the directors proffering reasons for the relevance of such accounting principles adopted/used in the preparation of the financial statements.

Answer 1

As an director i agree with the rules they have done Because By adopting a genarally accepted accounting priciple we can easily analyse thfinancial position of the company..8