Critically compare and contrast the accounting methods, structure and Essay

Critically compare and contrast the accounting methods, structure and regulation of Greece with the UK. Include a detailed and critical analysis of both current - Essay Example Effective control systems are usually situation specific and tailored to the management of each organisation. The exercise of managerial choice and the interdependence of accounting systems and the environment are acknowledged". (Rayburn and Rayburn (1991, p. 57) U.K. follows common law whereas Greece follows codified law falling under British Commonwealth and continental Europe respectively. "Greek law is based on codified Roman law with the judiciary divided into civil, criminal, and administrative courts. Judicial independence is guaranteed under the constitution" (Greece Profile) Many countries' accounting practices are influenced by their respective income taxation rules ignoring any other broader objectives. (Nobes 1983, Purcel & Scott 1986) In the case of Government bureauracrats setting the accounting standards, they are unequivocal in fixed formats. ".Bureaucracies are more likely to want certainty to make assessment of taxes, adherence to regulatory rules, etc., easier to specify and enforce" (Robinson, Chris, Venieris, george 1996) Greek accounting is guided by its Corporate Law 2190/1920, accounting standards stipulated by the Ministry of National Economy, the interpretations issued by the National Accounting Standards Board (ESYL) and the Greek General Chart of Accounts approved by Presidential Decree 1123/80. In UK, the Companies Act 1985 as amended for EU Directives.lays down the stipulation for accounting methods. As per the Act, there should be disclosures that accounts are as per the standards of the Accounting Standards Board and urgent issues task force. Cash flow reporting in Greece Cash flow reporting as per IAS 7 became mandatory in 2002 for Greek listed companies which should submit the Cash Flow Statement (CFS) to HCMC though not required to be published as in the case of balance sheet and income statement. A recent study found that while non-listed firms do not voluntarily report CFS, the listed firms also do not comply with the mandatory requirement and make the CFS publicly available." The results indicate that Greek companies have cash flow problems but not profitability problems. The publication of a CFS may reveal that many listed companies in Greece are not as robust as the balance sheet and the income statement potentially indicates. Thus, the main conclusion of the paper is that publication of the CFS in Greece should become mandatory. The HCMC has made significant attempts to enforce corporate governance principles for listed companies in Greece. These principles implicitly highlight the desire of the regulatory authorities that investors receive adequate and relevant information. Could it be, however, that investors get relevant information when they do not have the essential inputs required to value a company"(Kousenidis V, Negakis L, Floropoulos) This practice of providing information on sources and application of funds was