Question -1 (10 Marks)
Word limit 2000 words
Chambers, Edward and Bell, and Sterling have contributed immensely to accounting theory through their work on measurement bases. The aim of this work has been to minimise some of the discrepancies in financial reporting arising from the use of historical cost as a basis of measurement. Despite these efforts, historical cost accounting is still used within financial accounting.
1.1 Why do you think that historical cost accounting has remained an accepted method of accounting and how does this continue to affect financial reporting?
1.2 Describe and provide reasons for the best measurement method to use when measuring the value of roads and highways.
Question – 2 (5 marks)
Word limit 1000 words
The IASB Conceptual Framework states that the fundamental qualitative characteristics of useful information are relevance and representational faithfulness. Must both of these qualitative characteristics be satisfied before particular information is included within a financial report? Explain your answer.
Rationale
This assignment is designed to assist you in:
• gathering and integrating knowledge in order for you to analyse and comment critically on the application of accounting theories;
• critically appraising the objectives of accounting and relate them to the various concepts of accounting;
• analysing the possible usefulness of alternative measurement systems to historical cost;
• developing your learning through the application of the concepts covered in topics 1 to 3
Requirements
Assignments should be submitted through Turnitin as well as hard copy at reception. Turnitin submissions are due by midnight (AEST) of the date specified. You will be added to Turnitin in the beginning of the session. If you need assistance for turnitin log in, please contact your lecturer or the academic administrator before the assignment due date.
Question 3
Word limit 3000 words (15 Marks)
“Fair Value vs. Conservatism? Aspects of the History of Accounting, Auditing, Business and Finance from Ancient Mesopotamia to Modern China” by Richard H. Macve, in 2013 London School of Economics & Political Science (LSE)- Department of Accounting and Finance , November 20, 2013. http://papers.ssrn.com/sol3/papers.cfm?abstract_id=2389305 British Accounting Review, Forthcoming.
Refer to the above journal article and develop a critical review report on following aspects:
• Compare and contrast the two mainstream histories identified by Macve, i.e.
- ‘FAT is rationally derived from a basically coherent conceptual framework’
- ‘Conservative, historical cost based accounting …provide an anchor on which to base appraisal of firms and managers’ performance
• Are both these histories merely a myth? Provide your own opinion here but justify with examples and with references.

Rationale
This assessment is designed to assist you:
• In gathering and integrating knowledge on the theories which you have learned from topics 4 to 7.
• In developing your learning through the application of the concepts covered in topics 4 to 7
• To critically evaluate attempts of the development and application of the conceptual framework.
• To critically appraise the objectives of accounting and relate them to the various concepts of accounting.
• To demonstrate your level of understanding and the level of your research efforts.