QUESTIONS:

1.1)
The major sources of regulation of financial reporting in Australia are:
The corporations Act
Australian Accounting Standards
The Conceptual Framework
Australian Security Exchange Listing Rules.

1.2)
Technical issues may be identified by international standards organizations,
such as the IASB, or alternatively by sources within Australia, such as members
of the AASB. Once an item has been added to the boards agenda and it has
researched and considered an issue, consultation with stakeholders may proceed
with the issue of exposure drafts, invitations to comment, draft interpretations
and discussion papers. Once an appropriate response has been decided upon by
the various stakeholders the AASB will implement the ne standard to the current
accounting framework.

1.3)
The FRC provides broad oversight of the process for setting accounting
standards in Australia. The FRC appoints the members of the AASB, other than
the Chairman, and can issue broad strategic directions to the AASB. However,
FRC does not have the power to direct the AASB in relation to making a
particular standard, nor can they veto a standard made. The AASBs main role is
to identify technical issues and then develop and formulate appropriate
response in the form of new accounting standards, so unlike the broad view of
accounting standards by the FRC the AASB are the ones to create them.

1.4)
During the process of setting Australian accounting standards the IASB may
identifiy technical issues and bring these to the attention of the AASB to begin
the response to overcome this issue by the AASB. Also within the process of
setting standards by the IASB they will be consulted on how the AASB plans to
respond to the issue, this is how the IASB influence financial reporting in
Australia.

1.5)
Australian businesses will benefit from the adoption of the international standards due
to reduced financial reporting costs and by removing barriers to international capital
flows. Australians in general will benefit due to increased comparability of financial
reports prepared in different countries, and therefore lower analyst costs, and the
improved quality of financial reporting in Australia which of course would assist
through providing more useful information for decision makers.

The 'one size fits all' approach has significant issues including the reduced
control by Australian bodies in determining accounting standards that will
benefit Australians most. Another issue because of Australia accounting
standards were considered to be one of the highest quality a one size fits all
approach may reduce the quality of the standards to accommodate for other
nations. Also the influence of the European union on the international bodies
may be detrimental to Australia.

1.6)
The major difference between the IFRSs and Australian accounting standards is
that the IFRSs focuses only on for-profit organizations, therefore the AASB has to
make slight amendments to the international standards to take into account
public and non-profit organizations so that their standards are inline with the
wider Australian business community. Also the AASB will formulate accounting
standards by issuing the text of IFRS but may modify them to take into account
Australian legal environment.