International Corporate Reporting Issues
The internationalization of accounting standards is being further supported by the joint IASB/FASB review of the IASB’s conceptual framework document. However, the completion of Phase A of the joint IASB/FASB review in September 2010 was followed by the suspension of the overall project which is now behind its original schedule; this has recently been re-activated with the intention of putting all remaining Phases out for discussion in late 2013. Phase A dealt with the Objective of Financial Reporting and, following consultations, the revised Conceptual Framework document identifies Decision Usefulness, incorporating Stewardship, as the key objective to support investors’ and lenders’ needs for information.

Requirement:
(a) Using the provided published financial statements of Diageo plc, identify the types of information which support the Stewardship aspect of the objective of financial reporting. You should then critically evaluate the extent to which this information could support the decision-usefulness aspect of the objective of financial reporting, with a focus on investors’ and lenders’ needs for information regarding the future. (40 marks)
(b) Select two areas from the balance sheet and/or income statement of Diageo plc and identify the international accounting standard being applied, providing a critical evaluation of the effectiveness of the information provided to users. You should make reference to the information also provided in the disclosure notes for the two items in the balance sheet and/or income statement.
(c) Present the information in (a) and (b) above in a report format with suitable headings and sub-headings.