MODELS THAT EVALUATE THE VALUE OF THE FINANCIAL INSTRUMENTS. RECOGNITION AND MEASUREMENT UNDER INTERNATIONAL RULES

As the present financial markets have broadened and deepened, increasing numbers of firms are utilizing innovative financial instruments to accomplish business objectives and enhance shareholder value. It is crucial for the financial managers to keep abreast of available financial instruments, the business settings in which these instruments can create—and destroy—value, and modern analysis techniques for these instruments. A financial manager also should possess a basic understanding of the markets in which these instruments trade. The article provides a brief presentation of these instruments, along with some examples based on the International Accounting Standards 32 Financial instruments: disclosure and presentation and International Accounting Standards 39 Financial instruments: recognition and measurement.financial markets, financial instruments, financial assets, financial debts

Sustainability of the Tourism Industry, Based on Financial Key Performance Indicators

Even if there is a real need of a set of key performance indicators for small and medium sized enterprises, this is not yet considered to be satisfied. Our research is focused on two main aspects, each of them individually important for the users of accounting information: the basic indicators specific for analysing operational performance and for decision making and the trend of the key performance indicators in the context of the economic crisis. The starting point of the study is a questionnaire addressed to small and medium sized enterprises activating in the tourism area, especially in the hotel industry. The respondents answered the questions in perfect anonymity by choosing one of the multiple choices for some of them and offering open answers to the others. Our analysis reveals a fair view of the dynamic of the most used key performance indicators in Romanian hotel industry, the limits of their interpretation and usage and the evolution of the financial and economic performance. The declared purpose of the research is to set the bases of a starting point in order to provide solutions for improving the relevance and the usage of these indicators in this domain, in the context of a sustainable business, taking into account the nowadays status of the economy in general and in particular the hotel industry

The IFRS standard for small and medium-sized entities – another challenge for the Romanian accounting?

In the early 2000s, the accounting has been connected to the international realities. From that moment on, we have witnessed an extraordinary dynamic of the Romanian accounting, evidenced by the many changes that have occurred in the accounting rules. Internationally, the dynamism is also the main feature of today's accounting. We witness almost annually the reconsideration of the international accounting referential. In this context of the frequent changes that occur in the accounting aria, the IASB launched the International Financial Reporting Standards for Non-Publicly Accountable Entities (formerly Small and Medium-Sized Entities), a controversial approach in the international accounting. The objectives of this paper will be followed on two levels: first, we will put forth the position of different countries on this IASB initiative and second, we will show, by the means of a positive research based on an empirical study, the attitudes of professional accountants in Romania towards the possible implementation of the IFRS for NPAEs in the Romanian accounting in the next period..IFRS for NPAEs, Romania, IAS/IFRS referential

Methods of Fraud and Tax Evasion by Breaching the Accounting and Fiscal Rules – Jurisprudence

For the purpose of not fulfilling tax obligations regarding the payment of taxes and duties due to the state budget, some economic entities use various methods whose goal is the decrease of taxable estate and tax obligations by avoiding the payment of profit tax, income tax, salary contributions and taxes assimilated to them, as well as of excises. Such fraud methods identified in practice regarding the decrease of collected VAT, artificial increase of deductible VAT and decrease of due profit tax emphasize the role of accounting in preventing and combating tax evasion and shall be presented hereinafter

Exploitation of the Effect of Services Diversification in the Process of Maintaining the Attractivity and Resilience of the Accounting Profession

Digital reporting, sustainability, forensic accounting, money laundering prevention are challenges or opportunities for maintaining the attractivity of the profession and supporting its resilience? In this article we intend to discuss the challenges regarding the attraction and retention of talented persons in the accounting profession, as well as the way in which the new services transform the manner in which the professional accountants carry out their activity, having at the same time a positive impact in the change process which is based on the concept of “smart accounting for smart economy”

Franchising contract – a modern juridical and economic instrument for business expansion

Development of trade, as well as its dynamics in the context of globalization, have created the premises of acceleration in the commercial distribution networks expansion, with immediate effects in the sphere of law. Transgression, moreover, was predictable and any legal implication in economics, as well that of the judiciary system in the economy can't be ruled out. Among the commercial agreements, franchising has experienced one of the most spectacular developments of all kinds of business, due to the favorable context in which it developed. In this paper we aim to analyze the essential elements of franchising, based on the legal phenomenon rather than on the economic one. This article also examines the behavior of existing and future entrepreneurs regarding the possibility of implementing this legal instrument. These results are consistent with the hypothesis that, even if, according to the statistics, the franchise contract has successfully imposed itself in the business world, there is enough reticence in adopting it as a development measure

CHALLENGES OF INTERNAL AUDIT IN THE CURRENT CRISIS

Modern economic theories reject the generalization of theories concerning the economic and financial crises. Each financial crisis is unique, a historic accident, generated by specific factors in a certain socio-economic and political set-up. According to these theories, crises cannot be anticipated so as to minimize their negative effects. In spite of the fact that economic and financial crises are not identical and do not produce identical effects, history teaches us that they are strongly correlated with the cyclic nature of economic processes. The current economic recession, which shows in all fields of activity, is determining auditors to make evaluations which are a lot more precise, based on extensive procedures, as long as the presumption of activity continuity into the future is accurate. In this context, internal audit is individualized as an managerial assistance function, which allows a correct perception of the reality of the business as a whole and/or as predefined processes. The purpose of this paper is to create an overall picture of internal audit by collecting data and information from literature and showing the dimensions and the internal audit practices internationally. Therefore, we conducted a research based on the analysis of national and international publications, various articles and studies in the financial press, on the emergence and development of the internal audit function both internationally and nationally. Later we analyzed the position of internal audit in terms of global financial crisis, all these leading to the usage of a comparative study of twelve international companies in order to highlight the specific features of the internal audit function in each organization. Our intention is to emphasize aspects of internal audit departments, relations between them and the management, their role in companies based on studies provided by Protiviti, a global consulting and internal audit services company, having experts specializing in risk, consultancy and transactions

The financial auditor’s credibility in postcrisis economic policies

Given the nowadays economic instability, we might consider that financial auditors could have been one of the important triggers for the economic crisis. Companies that, shortly after undergoing financial audits and publishing their financial statements, seemed to display a viable and true and fair view of their performance in the financial statements – endorsed by financial auditors – faced economic tribulations and needed financial aid to be able to survive on the market, banks’ case included. Scholars believe that the banks and investment companies decisively contributed to the unfolding of the financial crisis. This study presents the important role played by the financial auditors in deploying the economic crisis, as well as solutions for re-instating the financial audit activity, as we outline a discrepancy between expectations and results. The role of financial auditors and of corporate governance should shape the economic re-launch by means of differentiated and finely-tuned approaches and be correlated, as well as proportional, with the dimension and characteristics of the audited company

Research on the Evolution of Financial Audit in Romania – Past, Current and Future Trends

AbstractIn the early 2000s, the phenomenon of globalization of economies led to much reconsideration in the Romanian accounting. At that time, the economic, domestic and international context, characterized by extraordinary dynamics of international capital flows, required greater concern for the quality and credibility of accounting information improvement. As a natural consequence and, equally, an imperative measure, due to changes in the economic environment, the accounting profession has seen new values in Romania since 1999, when the financial audit was defined for the first time, and the financial auditors profession has been formally recognized. From that moment until today, we witnessed the market consolidation of the financial audit in Romania: only during 2001-2005, the number of economic entities required to be audited increased from 197 to 2402. The main objective of this paper is to highlight the main development directions of the financial audit in Romania from its early attempts to today, as well as its future perspectives