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The way in which brands are economically represented in the context of financial reporting is controversial in theory and practice. This holds especially against the background of the ever- increasing importance of intangible assets. Brands and the economic success associated with them are thus regarded as a key variable for overall corporate success: cash flows can be accelerated and expanded through the use of brand-strategic options, while existing risks may be mitigated. In addition to a large number of theoretical definitions, the determination of brand value from both a marketing and an accounting perspective is also characterized by a complex interaction of numerous influencing factors. This is where the International Accounting Standards IAS 38: "Intangible Assets" (isolated acquisition of a brand) and IFRS 3: "Business Combinations" (acquisition of a brand as part of a business combination) take effect: These are intended to ensure a comparable and reliable "true and fair view" for the presentation of intangible assets in international accounting. In addition to various recognition criteria, the accounting regulation here also includes the accounting valuation of intangible assets and thus also of brands. In principle, valuation in accordance with IAS 38 is based on acquisition costs. The determination of the operating life for impact evaluation is highly controversial both in literature and in practice. Under IFRS 3, acquisition costs are to be replaced by the fair value. Regardless of the method used, possible subjectivity is one of the central issues. The current discussion approach of the International Accounting Standards Board also clearly shows the need for simplification and concretization that still exists for practice: In particular, the accounting distinction between goodwill and intangible assets is the subject of discussions with the Global Preparers Forum, among others. The interests of users, preparers and auditors of corporate financial reporting must be taken into account equally. In particular, the prohibition on recognizing self-created brands in the balance sheet makes it difficult to assess their value. Furthermore, it creates a weak point in the presentation of the true and fair view of a company's financial position and financial performance that is generally required. Regardless of the previous, the current rules provide preparers and users with a basic overview of existing intangible assets. Irrespective of how valuation is determined individually, the IASB's rules thus help to create a fundamental structure. In which approach the future discussion will result in remains open.
DIGI4Teach - Handbook
(2023)
One of the important outputs of our DIGI4Teach consortium is this Handbook, which consists of two parts. Part A contains an analysis of the most important descriptive research results conducted within the DIGI4Teach Erasmus+ project regarding the use of digital technology in teaching economic disciplines in partner countries. Part B contains twelve case studies from different areas of economics and business (accounting, finance, marketing, tourism and trade) that were prepared using various digital tools and they can be freely used in classes or other forms of education.
The accounting of small and medium enterprises is specific, compared to the accounting of large enterprises, for several reasons. First of all, lower business volume implies less demanding accounting in terms of less turnover and the number of accounts to be processed, lower financial reporting requirements, more favourable tax treatment is expected and the like. Practical experience in the years of application of EU-accounting directives, which represent the framework of financial reporting of companies at the EU level, pointed to certain difficulties or excessive administrative burden of small and medium enterprises in relation to the requirements for large companies and identified areas for improvement. The complexity of these regulations as well as problems in practical application have led to the need to develop and publish a revised single accounting directive (2013/34/EU). This Directive was primarily adopted with the aim of simplifying the accounting and financial reporting of small and medium-sized enterprises.
Today, it is common for small and medium-sized enterprises to go beyond the borders of one country. In the internationalization of business, SMEs face many challenges and potential barriers. First of all, it refers to financial, human and procedural barriers, but also to informational barriers related to regulations, rules and laws of other countries. Since the accounting and tax treatment of the same business transaction may differ between countries, it seems entirely justified to investigate whether there are differences in the regulation and regulation of the accounting system between the two countries. This paper compares the characteristics of small and medium-sized enterprises’ accounting systems between two economically strongly connected countries, Germany and Croatia, which is the main goal of this paper. It is well known that financial reporting is a particularly important, final phase of accounting data processing. Namely, financial reporting system of these two countries is compared by using the method of comparison and classification analysis. The types and scope of financial statements have been defined and the content of financial statements that SMEs are obliged to compile and publish has been analysed. The paper pays additional attention to the analysis of similarities and differences between these two accounting regulations as well as current events in the implementation of the revised accounting directive into national legislation, especially in simplifying the financial reporting of the smallest, but numerically most represented micro enterprises. The important finding of the research show that some changes have been made but there is still room to improve accounting regulations for this segment of entrepreneurship.