Hi there this is my current assignment that I have, however I do not know where to start or how to start the assignment, especially part 2 where I

Hi there this is my current assignment that I have, however I do not know where to start or how to start the assignment, especially part 2 where I have to consider both approaches in light of the objective of general purpose financial reporting and etc.

Could you advise me on how to go about doing this? And what exactly does step 2 require me to do? Thank you I really appreciate your help

Issue to be investigated: Measurement approaches

The choice of a measurement approach in financial reporting is significant as it impacts on the qualitative characteristics or quality of accounting information produced. For a number of years, the IASB advocated for a move to a single measurement model, being Fair Value. This may be observed in the following quote from former IASB Chair Sir David Tweedie in 2003:

The current direction that we are taking will be what I like to call 'tell it as it is' accounting. This may mean an increasing reliance on fair values, when those values can be determinedaccurately ... The implication of this transformation in accounting is great. (Tweedie, 2003, p. 721)1

However, IFRS standards today still make use of different measurement bases resulting in annual reports being prepared on the basis of a mixed measurement model. This is illustrated in a 2015 speech by current IASB Chair Hans Hoogervorst:

Despite all these shortcomings of historical cost accounting, the IASB has not opted for current value measurement in general, or fair value in particular, as the default measurement basis. (Hoogervorst, 2015, p. 4)2

You have recently been appointed as a graduate accountant in a company listed on the Australian Securities Exchange Top 200 (ASX200) Blackmores, and are currently reporting to the Chief Financial Officer (CFO). The CFO of Blackmores has been asked to participate in a focus group organized by the AASB on whether standard-setters should reconsider their use of a mixed measurement model.

1

You are to research and comment on these issues and present your findings as follows:

Prepare business report to update the CFO on the issue of measurement in financial reporting which will serve as a foundation for the company's forthcoming engagement with the AASB.

Your business report needs to be concise and informative. In preparing your report, you should investigate a range of issues:

1. (i) Provide a description of the various measurement bases used in your company'sfinancial statements (you are required to refer to Blackmores' 2018 annual report) and state whether Blackmores uses a mixed measurement approach or a single measurement approach.
2. (ii) Critically evaluate the use of a mixed measurement approach versus a single measurement approach (based on fair value) under IFRS. Consider this in light of the objective of general purpose financial reporting and the primary users of general purpose financial statements, and the qualitative characteristics of useful financial information. Support your discussion with reference to theories covered in this unit, academic journal articles, and where relevant high quality professional articles and newspapers.
3. (iii) Provide a recommendation on the future direction the IASB and the AASB should take in regards to measurement, which your CFO can take to the focus group of the AASB. Support your recommendation with reference to theories covered in this unit and academic journal articles.