Enforcing Financial Reporting Standards: The Case of White ...

More documents

Recommendations

Info

Enforcing Financial Reporting Standards: The Case of White Pharmaceuticals AG Henning Zülch, Dominic Detzen ISSN 1864-4562 (Online version) © HHL – Leipzig Graduate School of Management HHL-Arbeitspapier HHL Working Paper No. 105 The sole responsibility for the content of the HHL Working Paper lies with the author/s. We encourage the use of the material for teaching or research purposes with reference to the source. The reproduction, copying and distribution of the paper for non-commercial purposes is permitted on condition that the source is clearly indicated. Any commercial use of the document or parts of its content requires the written consent of the author/s. For further HHL publications see www.hhl.de/publications. . 105
Enforcing Financial Reporting Standards: The Case of White Pharmaceuticals AG Abstract As a consequence of accounting scandals, Germany – like many other countries – set up a supervisory body to control the compliance of capital market oriented companies with accounting regulations. The Financial Reporting Enforcement Panel (FREP) assumed their duty in July 2005 and has forced a number of companies to restate their financial statements. This case study adapts one of the real cases of the FREP and invites students to reflect on the enforcement of financial reporting standards: White Pharmaceuticals AG enters a strategic alliance to profit from the research and development of their partner. The company charges all payments that it conducts in the course of the alliance to their expense accounts. The FREP, however, finds that the final lump-sum payment should have been capitalized by White. The case reviews the accounting for research and development expenditure and also discusses the convergence of financial reporting standards in the U.S. and Europe. Keywords: Financial Reporting Enforcement, Research and Development, IFRS
Page 1: Enforcing Financial Reporting Stand
Page 5 and 6: same time, he made his intention qu
Page 7 and 8: Accounting for the Agreement Soon a
Page 9 and 10: capitalization of the payment with
Page 11 and 12: The Discussion with White’s Audit
Page 13 and 14: weeks. The short time frame surpris
Page 15 and 16: (3) Assess the payments made by Whi
Page 17 and 18: (5) Now, imagine that White’s CFO
Page 19 and 20: Case Synopsis TEACHING NOTES Our st
Page 21 and 22: (3) Who is to take responsibility f
Page 23 and 24: Exceptions to this rule are most no
Page 25 and 26: In addition, the transaction may ha
Page 27 and 28: had filed for it and it seems like
Page 29 and 30: eversed as students sometimes imagi
Page 31 and 32: predictive role of accounting infor
Page 33 and 34: (2) The impact of an adoption of IF
Page 35 and 36: considered part of the matching pri
Page 37 and 38: selected by one of three ways: Eith
Page 39 and 40: monetary penalties and a publicatio
Page 41 and 42: number of oppositions by companies.
Page 43 and 44: conduct their audit in a way that m
Page 45 and 46: Thus, it is also obvious that revis
Page 47 and 48: the transaction. Instructors who wi
Page 49 and 50: HHL-Arbeitspapiere / HHL Working Pa
Page 51 and 52: 77 La Mura, Pierfrancesco; Swiatcza
Page 53 and 54:
47 Fischer, Thomas M.; Schmöller,
Page 55 and 56:
15 Hungenberg, Harald (1998) Kooper
show all

Enforcing Financial Reporting Standards: The Case of White ...

You also want an ePaper? Increase the reach of your titles

Delete template?

Save as template?