2.0 Accounting Regulatory Framework

FAC TOPIC 2: ACCOUNTING REGULATORY FRAMEWORK (ACCOUNTING

RULES)

What is meant by the regulation of published financial statements?

The regulatory framework of accounting is a general term used to describe the legislation

and other rules that govern the content and format of company final accounts. There is no

legislation or other regulations covering the final accounts of sole traders and

partnerships. However, it is generally accepted that their accounts should closely follow

the rules and regulations relating to companies since these are regarded as ‘best practice’.

The format, content and presentation of financial statements have to be subject to rules &

regulations in order that;

i. Adequate, consistent accounting information is available to the users of accounts.

ii. The accounts conform to national and international law.

iii. The accounts are standardized so as to facilitate comparisons, and

iv. The accounts are understandable and useful in evaluating performance.

The regulatory framework is provided by

i. The government/ The Company’s Act with which all companies are required to

comply,

ii. The accountancy profession/ The accounting standards produced by the

Accounting Standards Committee (ASC) and Accounting Standards Board

(ASB) with which most (but not all) companies are expected to comply, and

iii. The stock exchange/ with which all companies whose shares are listed on the

Stock Exchange are expected to comply.

1 The Government

The Companies Acts (Ugandan Case)

The Companies Act, Cap 110 (1961) as amended provides basic requirements for

accounting and reporting applicable to all private and public companies in Uganda. The Act

requires public companies to file annual returns with the Registrar of Companies, including a

balance sheet, profit and loss account, group accounts and auditor’s report.

2. The accountancy profession/ the accounting standards

The accountancy profession (Ugandan Case)

The Uganda accountancy profession comprises of one major professional accountancy body i.e.

The Institute of Certified Public Accountants of Uganda

NOTES FOR YEAR ONE SEMESTER ONE FOR ALL STUDENTS AND FINALISTS

Accounting and finance