HA3011 Advanced Financial Accounting

Assignment: Group assignment. Groups of two only. (Note: no individual assignments unless agreed to with your lecturer by the end of week three).
Due date for submission: Wednesday 18th December (11.59pm on Safeassign)
Assessment weighting: 20%
Assignment instructions:
1) The assignment is to be of 2000-2500 words.
2) It is your responsibility to find a partner. Non-attendance of lectures is not an appropriate reason for not having a partner. There is a penalty (as per your student handbook) of 50% of the value of the assignment for non-compliance with assessment requirements.
3) Each member is to provide approximately 50% of the submitted report
4) Late submissions will be deducted 5% of the assignment value (1 mark) for every day late. This includes weekends as you have access to Safeassign (Bb). If a submission is in excess of ten days late, your lecturer may well refuse to accept or give a token mark of 1/20.
5) Only one member of the group is to submit to Safeassign on behalf of group.
6) Plagiarism is not acceptable at Holmes (or any other HE provider). Whilst you may refer to works of others and even copy small sections of their works, it must be properly referenced and you need to keep to the 15% rule.
7) On the front page of your assignment, provide “wordcount”.

Assignment
In recent times, there has been a case of accounting for changing price, from the traditional historical cost accounting to more “appropriate” methods. The problem with historical cost accounting according to Elliot is that “an implicit and troublesome assumption in the historical cost model is that the monetary unit is fixed and constant over time”. As students would probably know, historical cost accounting assumes that money holds a constant purchasing power.
Task.
You are firstly required to provide an argument identifying the limitations of historical cost accounting, identifying the limitations. You should consider the areas of rising prices, changing prices, operating results and even capital maintenance in your answer. Then consider the areas of Current Cost Accounting, Exit-price Accounting, Current Purchase Power Accounting and Continuously Contemporary Accounting. What are they, what are the advantages and disadvantages of each and then draw a conclusion as to what you feel is the best option and why.
Marks will be given for presentation of report, research, content and articulation of your findings.