22309 Accounting for Overseas Transactions

Subject level: Undergraduate

Handbook description

This subject introduces students to the basic concepts underlying the variety of accounting issues involved in the recording and reporting of overseas transactions. It covers relevant aspects of documentation, foreign exchange gains and losses, foreign exchange hedging, forward exchange contracts, effects of overseas inflation, financing overseas transactions and facilitation through government and non-government agencies. It provides skills and information needed to advise clients on overseas transactions. Concentration is placed on the operational and accounting treatment of foreign operations as distinct from a marketing or economic approach to the subject area.

Subject objectives/outcomes

On successful completion of this subject students should be able to:

1. understand the basic concepts underlying the various accounting issues involved in the recording and the reporting of a variety of overseas transactions commonly encountered by firms engaged in foreign operations
2. understand the nature and importance of import/export documentation, the foreign exchange mechanism, overseas inflation and the assistance provided by government and non-government agencies
3. understand the information requirements needed to advise clients in relation to overseas transactions
4. further develop seminar skills and gain an exposure to oral questioning on selected seminar topics
5. further develop information collecting, report writing and teamwork skills.

Contribution to graduate profile

The subject provides an in depth study of accounting concepts and techniques in an area of increasing importance to managers and accountants. The subject content is particularly relevant to students who, as accountants, may find themselves advising business clients on various aspects relating to overseas transactions and operations in foreign markets.

Teaching and learning strategies

The learning process will focus on conceptual and technical material through practical exercises, case studies, selected readings, discussion and debate. Students will take part in both individual presentations and group project work on selected topics under the guidance of the lecturer. Student reports will be presented to the class by each student group in seminars during the semester. Class discussion and questions relating to report presentations will form valuable feedback and will assist the group in the finalisation of their written report.

Content

• Introduction and overview
• Review of basic accounting concepts
• Import/export documentation
• Methods of payment
• Insurance
• Government assistance, concessions and regulations
• Dumping and anti-dumping regulations
• Foreign exchange concepts and market mechanism
• Australian accounting standards
• Accounting for foreign currency transactions
• Foreign operations and investment overseas
• Transfer pricing
• Taxation effects and double tax agreements.

Assessment

Assessment item 1: Final examination

Assessment item 2: Individual topic presentation

Assessment item 3: Syndicate project presentation

Indicative references

Australian Institute of Export (NSW), (1997) The Export Handbook. 16th edition, College of international Business Ltd., Sydney

Australian Society of Accountants. (2004). Accounting Standard: AASB 121: The Effects of Changes in Foreign Exchange Rates

Australian Society of Accountants. (2004). Accounting Standard: AASB 139: Financial Instruments: Recognition and Measurement.

Australian Trade Commission. (2005). Export Market Development Grants:Guide to Benefits. Canberra: Australia

Bosshart, David. (2006) Cheap : the real cost of the global trend for bargains, discounts & customer choice London : Kogan Page

Choi, Frederick D. S., (2008) International accounting 6th ed. Upper Saddle River, N.J. : Pearson Prentice Hall

Daniels J, Raderbaugh L and Sullivan D (2004) International Business, International edition, Pearson Education: New Jersey

Davies, Iwan (ed) (2005) Issues in international commercial law Aldershot, Hampshire, England ; Burlington, VT : Ashgate

Doupnik, Timothy S., Timothy Doupnik, Hector Perera (2006): International accounting. Boston, Mass. McGraw-Hill

Fazio, Silvia, (2007) The harmonization of international commercial law. Alphenaan den Rijn : Kluwer Law International

Felemegas, J (edited) An international approach to the interpretation of the United Nations Convention on Contracts for the International Sale of Goods (1980) as uniform sales law. Cambridge ; New York : Cambridge University Press, 2006

Gregoriou, G.N., and Mohamed Gaber (edited) (2006) International accounting : standards, regulations, and financial reporting. 1st ed. Amsterdam ; Boston ; London Elsevier

Hinkelman, Edward G., A Short course in international trade documentation [electronic resource] : the key documents of exporting, importing, transportation and banking. Novato, Calif.: World Trade Press, 2001

Iqbal M (2002) International Accounting: A Global Perspective, 2nd edition, South Western: Cincinnati

Levi, Maurice D., (2005). International Finance. 4th.Edition, McGraw-Hill, New York

Madura, J. (2005). International Financial Management. 8th edition, South-Western Publishing, Mason, Ohio

Mo, John. (2003) International commercial law. Chatswood, N.S.W. LexisNexis Butterworths

Nobes, Christopher and Robert Parker (edited) (2006) Comparative international accounting 9th ed. New York : Financial Times

Nobes, Christopher (edited) (2004) Developments in international accounting : general issues and classification. Cheltenham, UK ; Northampton, MA : Edward Elgar

Radebaugh, Lee H., Sidney J. Gray, Ervin L. Black (2006) International accounting and multinational enterprises. 6th ed. Chichester : Wiley

Roberts C, Weetman P and Gordon P (2002) International Financial Accounting – A Comparative Approach, 2nd edition, Pearson Education

Sacks, P. and Malbon, J. (1992). Australian Export Manual. Melbourne,: Longman Professional

Shanahan M (2001) Globalisation in history: issues in definition and process identification'. In Global business regulation: some research perspectives. Edited by Thorne & Turner. Pearson Education: Sydney

Shapiro, A.C. (2003), Multinational Financial Management, 7th edition, John Wiley & Sons, New York

Viney, C., (2003) Financial Institutions, Instruments and Markets. 4th Edition, McGraw Hill

Wild J, Wild K and Han J (2003) International Business, 2nd edition. Prentice Hall: New Jersey

Wiseman, J (1998). Global nation? Australia and the politics of globalisation. Cambridge University Press.

Other resources

No single text has been adopted for this subject. A CD containing a compilation of public domain material will be made available to each student syndicate on a short-term loan basis. The material will provide useful extension material for the student study and research.

Selected references, as appropriate will be drawn from a variety of sources. The topic areas to be studied and the method of study will require each student to undertake extensive research of both a literary and practical nature.