2.     Sharon Josephine Ekklesia J.P. / 2301937904 

3.     Stefani Anggraeni / 2301937835

4.     Yolanda Angie / 2301937910

1.     Single set of high-quality accounting standards established by a single standard-setting body. Who are they?

Set of high quality accounting standards is a necessity to ensure adequate comparability. There are 2 organization that have role in it, they are International Organization Of Securities Commisions (IOSCO) and IASB (International Accounting Standards Board).

a. IOSCO tidak membuat standard accounting but this organization help in regulating the world’s securities and future markets. IOSCO also supports the development and use IFRS or IASB as the single set of high quality international standards in cross border offerings and listings.

b. IASB was originally formed in 1973 as the International Accounting Standards Committee (IASC) and renamed it as IASB in 2001, and then known as IFRS (International Financial Reporting Standards) until now. The standard setters of IFRS are:

-The IFRS Foundation : it provides oversight to the IASB, IFRS Advisory Council, and IFRS Interpretations Committee, and it also appoints members, review the effectiveness, and helps in the fundraising efforts for these organizations

-The International Accounting Standards Board (IASB) : It develops a single set of high quality, enforceable, and global international financial reporting standards for general purpose financial statements

-The IFRS Advisory Council : it provides advice and counsel to the IASB on major policies and technical issues

-The IFRS Interpretations Committee : it assists the IASB throung the timely identification, discussion, and resolution of financial reporting issues within the framework of IFRS

And then, as a link between accounting standard-setters and those public authorities, a monitoring board was created in order to oversees and provides political legitimacy to the overall organization.

 

2.     Consistency in application and interpretation. How does this work?

Consistency in application and interpretation means that when a firm, especially the accountant of the firm decides to use or adopt an accounting principle or method, then the clerk must use it consistently for the future accounting period, both in the terms of its application and interpretation. The clerk is not allowed to change the method of accounting in reporting the financial results, because some of firms frequently change the method of accounting in order to record more revenue or profits for the company, so the profits can  be suddenly changed and it is used for attracting the investors. Also, the consistency in application and interpretation of accounting is important for the auditors. The auditors would really concern the consistency usage in financial reporting method, so, if the firms follow the consistency principle, then the auditors can compare the reports from period to period in more detail, organized, effective, and efficient, and also it also makes the auditors can  measure and audit or find the problem in the firms’ reporting more easily.

3. Common disclosures. Provide examples
 Financial statement disclosure is a concept, method, and media about how financial statement information is conveyed to interested parties. Simply stated, disclosure is the final step in the accounting process, namely presentation in the form of financial reports. Disclosure has several objectives, namely:

a. Disclosure aims to protect management treatment that may be unfair and open

b. Disclosure aims to provide information that can help the effectiveness of the nine user decisions

c. Disclosure aims to disclose to the public but still limit it according to user needs

Disclosures include the financial statements themselves and supplementary information, so the examples of disclosures are:

a. Balance

b. Comprehensive income statement

c. Statement of Changes in Equity

d. Cash flow statement

e. Other notes and reports

f. Technical term

g. Explanation in parentheses

h. Appendix (details of product sales, details of trade receivables, details of fixed assets on the basis of their type)
Another detail example of note disclosures are :
a. summary significant accounting policis, example : what accounting method that's used in calculating depreciation (FIFO method)
b. investment, for example : show type of investment, such as government obligation, mutual fund, common stock, or corporation obligation
c. fixed asset , for example detail of original loan amount
d. leases, for example describe amount of rent expense
e. contingencies, for example detail for report for disaster planning
f. related parties, for example board members, senior management, significant funders
g. pledges/contributions, for example detail of firm's account receivable aging schedule 

4. Common high-quality auditing standards and practices. Provide examples  
Auditing standards are standards / rules / criteria established and approved by the Indonesian Institute of Certified Public Accountants (IAPI), covering 3 parts namely general standards, field work standards and reporting standards.

1) General standards

a. The audit must be carried out by one or more people who have sufficient expertise and technical training as auditors.

b. In all matters relating to the engagement, independence in mental attitude must be maintained by the auditor.

c. In carrying out audits and preparing their reports, auditors are required to use their professional skills carefully and thoroughly.

2) Field work standards

a. Work must be planned as well as possible and if used an assistant must be supervised properly.

b. An adequate understanding of internal control must be obtained to plan the audit and determine the nature, timing and scope of the testing to be carried out.

c. Sufficient competent audit evidence must be obtained through inspection, observation, inquiry and confirmation as an adequate basis for expressing an opinion on the audited financial statements.

3) Reporting standards

a. The auditor's report must state whether the financial statements have been prepared in accordance with generally accepted accounting principles in Indonesia.

b. The auditor's report must indicate or state, if any, the inconsistency of the application of accounting principles in the preparation of the current period's financial statements compared to the application of the accounting principles in the previous period.

c. Informative disclosures in financial statements must be considered adequate, unless stated otherwise in the auditor's report.

d. The auditor's report must contain a statement of opinion regarding the financial statements as a whole or an assertion that such statements cannot be given. If the overall opinion cannot be given, then the reason must be stated. In the event that the auditor's name is associated with the financial statements, the auditor's report must contain clear instructions regarding the nature of the audit work carried out, if any, and the level of responsibility assumed by the auditor. 

Examples of audit standards

1) International Standards on Auditing (ISA)

ISA is published by IAASB (the International Auditing and Assurance Standards Board), which is a body formed by IFAC (the International Federation of Accountants).

2) AICPA (the American Institute of Certified Public Accountants) Auditing Standards

In America the name of the applicable audit standard is SASs (Statements on Auditing Standards), issued by ASB (the Auditing Standards Board), a body under the AICPA (the American Institute of Certified Pablic Accountants).

3) PCAOB (Public Company Accounting Oversight Board) Auditing Standards

PCAOB (Public Company Accounting Oversight Board) is a body formed under The Sarbanes - Oxly Act (SOX), which is a law on reform of public company accounting practices and investor protection.

4) In Indonesia SPAP (Public Accountant Professional Standards)

Issued by IAPI (Indonesian Institute of Certified Public Accountants)

5.     Common approach to regulatory review and enforcement. 

Application of international accounting standard is to determine that reporting under international accounting standard is associated with high accounting quality. Regulatory review refers to processes that issued by agencies. Regulatory review may involve an examination of the content or effect of a rule, its estimated economic costs and benefits, or the rules and the rulemaking agency to procedural requirements. Regulatory review process allows the agencies or industries to ensure that the regulations drafted by different agencies contribute to the administration’s goals. System of regulatory oversight looks reasonably comprehensive. Agencies must use cost-benefit analysis to determine which rules to adopt. The greater the impact of a rule on the economy, the more rigorous the accompanying analysis must be. It can be said that regulatory review is important to be applied in agencies to create system that results in cost benefit and lower cost of operational. Regulatory review creates standard to provide agencies’ rule that can make high accounting quality. Rules, procedures, policies, are important to prevent from asymmetric information. For an example, if an agency has regulatory review, it means that it has a standard, so that people will understand with the documents. It will create high accounting quality. The agency must also assess and compare the costs and benefits of feasible alternatives and justify why its ultimate choice of regulatory method maximizes the benefits. Regulatory review comprises all the regulations likely to have serious effect in our economy, isolated scrutiny of them might be a reasonable way to conserve scarce government resources. So that, regulatory review is important to maintain the operational of an agency that will create high accounting quality by providing standards like rules, policies, and procedures that will estimate economic costs and benefits. 

 Examples of regulatory review

- Environmental Protection Agency (EPA) has responsibility for writing the regulations that implement environmental laws

- Administrative Procedure Act (APA), uniform procedures for federal agencies to propose and issue regulations, a process known as rulemaking. Policy statements and licenses issued by agencies and provides for judicial review of agency adjudications and other final decisions.

- Congressional Review Act (CRA), by passing a joint resolution of disapproval that is then signed by the president, can overturn new federal agency rules and block those agencies from creating similar rules in the future.

- Regulatory Impact Analysis (RIA), a process used by regulators and other government officials to assess the anticipated costs and benefits of a regulation. The process involves comparing the estimated effects of a regulation with the estimated effects of other regulatory and non-regulatory options, including inaction.

- Significant regulatory action, economically significant rules and other significant rules. 

 

6.     Education and training of market participants. Provide examples

Education and training of market participants are important to train and give knowledge about the market so that everyone can understand that will impact in running the business well. education and training are designed to cover the basic competence skills for the new entrants in dealing floors and all other financial markets roles related to foreign exchange, interest rates and commodities instruments. Education and training will acquire a working knowledge of the structure and operation of the major foreign exchange and money markets as well as the products. Competency in all aspects of the operations and settlement processes with high quality by giving education and training. Education and training are important to get professional development qualification for financial market participants. employers and individuals will run the operating in professional financial markets with a high-quality, accredited, continuing professional development solution that encourages the highest standard of conduct and industry best practice. So that, education and training take a big role in creating skills and competency to be professionals in making high-quality business process that propose an ongoing strategy, defines the format and content, and implements a marketing and communication policy and best program in an industry. The distribution of education and training qualifications plays a crucial role in affecting the chances of different labour market participants in finding employemnet and in determining the nature of the employment they secure.

 Examples of education and training of market participants:

- ACI’s education program, a program that provides globally acknowledged, portable, professional qualifications that enhance career prospects, improve job performance and set benchmark with the industry. ACI communicates regularly with wide range of national regulators on the education and training of market participants. ACI also works closely with regulatory parties in a number of countries to ensure the market standard, ACI examinations and regulatory requirements all find common ground.

7. Extensible Business Reporting Language (XBRL) is a standard electronic communication language in an XML-based business data transmission and communication (Extensible Markup Language) that is used to support and perfect the process of preparation, collection and identification of data, analysis and presentation of more complex business information so in the process can be more effective and efficient in terms of time and cost, the information becomes more accurate and reliable in the business decision-making process by users such as analysts, investors, lenders, creditors, or regulators, even the inspection and validation process has been automated.
With XBRL, the data and information will be extracted and converted in shape without changing the data / information with the help of software into the XBRL electronic reporting format that refers to the reporting standards that already apply. XBRL consists of identifying tags and a kind of dictionary containing XBRL elements called XBRL taxonomies that can define, identify, and show the relationship of the data presented which are then grouped according to the type and information needs that need to be presented in a company's business reporting.
Business reports presented in XBRL format are referred to as document instances, where these reports can be used accessed, extracted, processed electronically, and their publications can be changed into various document formats. Even with this XBRL the presentation of reports can be more flexible for global investors because the XBRL format implements a standard of identifying information and can be expanded so that it is adapted to various types of needs for analysis using their own language.
Here is the XBRL report of PT Adhi Karya (Persero) Tbk
http://www.idx.co.id/Portals/0/StaticData/ListedCompanies/Corporate_Actions/New_Info_JSX/Jenis_Informasi/01_Laporan_Keuangan/02_Soft_Copy_Laporan_Keuangan//Laporan%20Keuangan%20Tahun%202020/TW1/ADHI/FinancialStatement-2020-I-ADHI.xlsx

8. Countries around the world have different corporate governance and legal frameworks. This is due to differences in history, culture, character, and legal systems and government policies that apply in the country, as well as the internal factors of each company in the country.
Those following are a few examples of corporate governance approaches and legal frameworks in various countries.
1. United States
In the US, investors play a very important role in corporate governance. The corporate governance approach in the US is more focused on minimizing conflicts of interest between owners / financiers and their management, namely by providing management with a number of incentives. Corporate governance in the US also relies more on disclosure rather than structural and process processes, because disclosure demands in the US are very high.
In the US, the roles of chairman and CEO are combined so that the power of a company is concentrated on 1 party.
2. Germany
The structure of corporate governance in Germany is among the most powerful in the whole world.
In Germany, the supervisory board must be separate from the board of shareholders and the function of the CEO who oversees the operations and management of the company.
3. Japan
Corporate governance in Japan focuses on how to increase the value of the country's currency and how to minimize risks arising from the banking realm. The Ministry of Finance in Japan also plays a greater role in the financial markets so that it is more strict. In addition, ownership is also based on the keiretsu system where the dominant shareholder is a holding company. And ownership in Japan is also dominated by "insiders" with subordinates who are very loyal so that in Japan this indeed upholds "trust" in managing the company.