Jatinder P. Singh and Prince Doliya
In this article, the hypotheses „whether the auditor’s functional domain, his approach, methodology and responsibilities are undergoing a metamorphosis with the adoption of Fair Value Accounting (hereinafter the „FVA”) and whether his/her role is moving away from the mechanized att ester of tangible evidence to the one exercising a substantively judgmental function in a holistic assessment of the values ascribed to be fair by the entity’s management” are tested. These hypotheses are tested on the basis of an analysis of the statutory provisions, the pronouncements of accounting and other regulatory bodies and accounting norms and theories. After sett ing forth the research objectives and the hypotheses, the necessity of the FVA is reviewed and the underlying philosophy is analyzed. Impediments in performing audits of fair-valuebased measurements are then identifi ed and the US auditing standards and their international counterparts are touched upon. Finally, some safeguards and precautions for the auditor in an audit of fair-value measurements are presented.
Mirjana Todorović
In addition to the capacity cost rate, the key parameter of Time-Driven Activity Based Costing – the TDABC is the time required for the realization of each business activity. In accordance with the TDABC methodology, the above-mentioned time is calculated by using time equations. Therefore, the total time required for the realization of a certain business activity is obtained by adding a normal (standard) time to the additional time required for performing modified forms of one and the same activity. The aim of this paper is to analyze the role and importance as well as various aspects of the building of time equations from the perspective of the organizational and methodological preparation for the realization and functioning of the TDABC. The research results show that the application of time equations leads to the increased accuracy of the calculation of costs and a product cost, reduces the complexity of the organizational and methodological preparation for the implementation and functioning of the TDABC system, i.e. enables the realization of a more effective and efficient costs calculation.
Vladimir Obradović
The transformation of the International Financial Reporting Standards (IFRS) into a single global language of financial reporting is well under way and followed by a problem of their inconsistent application from country to country, with negative consequences for the global comparability of financial statements. Starting from this, the main purpose of this paper is to give an overview of the main causes of the diversity of financial reporting practices between those countries declaring themselves to be the followers of the IFRS, as well as to identify the ways of overcoming this diversity. Applying the qualitative research methodology, it has been found that the flexibility of the IFRS provisions, which is inevitable in many cases, modifications in their incorporation into national regulatory frameworks and the diversity and unequal effectiveness of national mechanisms for their enforcement and the supervision of their implementation stand for the main causes of inconsistent accounting practices. In order to reduce the inconsistency, national financial reporting regulators should increase their engagement and coordination among themselves, and the International Accounting Standards Board should make additional efforts, which should primarily be focused on the global promotion of the fundamental basis of the IFRS.
Petar Veselinović
The economy of the Republic of Serbia is at an important turning point now. The first phase of the implementation of the transition process is completed, the reform processes are gaining a new momentum and entering the European Union is becoming more certain. In order to successfully finalize the transition processes,the reform of the public sector’s system of functioning is inevitable, among other reforms. The public sector in Serbia is low-productive and inefficient, irrationally set, with a multitude of problems that for many years have constantly been growing and becoming more complicated. The high rate of employment and average salaries in the public sector, on the one hand, and the poorly-formulated operational systems, on the other, are so designed that the public sector has a bad influence on economic development in general. The paper will analyze the situation in the public sector of the Republic of Serbia, with a special emphasis on creating a realistic basis for its reform, as a key determinant of the successful completion of the transition process, taking into account the specifics of the Republic of Serbia’s economy.
Nada Trivić and Viktorija Petrov
Each specific economic growth rate indicates relevant characteristics of current development, but also reflects the chances for achieving satisfactory future growth rate. Therefore, it is about a general interdependence and law of growth rate convergence. The main objective of this paper is to show that substandard growth could, sooner or later, result in the economic slowdown, and that the temporary growth acceleration can be achieved at the expense of the long-term growth rate. Scientific instruments applicable for achieving this research goal are the method of scientific analysis, historical method and the method of comparative analysis, as well as a number of techniques in the form of modern information resources. A key result of this paper is that all growth rates of endogenous production factors, without increasing the efficiency of resource use, are converging to the arithmetic mean of exogenous production factors growth rates. Therefore, the growth rate can be significantly increased at the expense of its quality and the substandard growth contains the „germs of its own limiting”.
Žaklina Stojanović, Jelena Filipović, Dragan Stojković
Although food with nutritive and health claims in the Western Balkan countries hasbeen present in this region for more than a decade, it has remained rather understudied. Therefore, the aim of this study was to determine the importance of products with nutritive and health claims in the Western Balkans, using qualitative research techniques. In the study, the prices and margins of the subject product group, distribution channels, demand perception and incentives as well as barriers for the future development of the functional food market were analyzed. The study included five categories of products with nutritive and health claims, whilethe technique of the in-depth interviews was adopted. The total of 29 producers and 26 retailers form all the six countries of the region participated in the research. Even thoughthe studied categories recorded a sales growth in the previous period, a significant increase is expected in the mediumand long term, along with the growth of the living standard – given that products with nutritive and health claims are more expensive than regular ones. The results imply that it is necessary that the level of education regarding the role of food in health preservation should be raised; and that a change inbad eating habits should be influenced. The development of functional food markets also requires a government support and an appropriate legislation.
Igor Mladenović
The current economic crisis has affected the level of the economic activity in many sectors of the economy. Among theorists and practitioners, the construction industry, followed by all the other industries, is increasingly said to be facing a serious crisis and to encourage its recovery of the overall economy of the Republic of Serbia. For this, the construction industry is said to be able to bear half of the economic growth of Serbia. However, taking into account the above-mentioned positions, the question is what the effects of the economic crisis on this economic sector are and what the effects of the measures imposed by the previous government of the Republic of Serbia regarding this sector were. Searching for answers to this question can to a great extent profile the answer of the current government regarding the solving of the problems in the Serbian construction industry.
Lela Ristić
This paper aims to present the current level of sustainable rural development in the Republic of Serbia, the development potentials and the problems identified in this area, as well as to bring to attention the necessity of sustainable rural development modernization as a significant part of the EU accession process. The mentioned issues are examined in accordance with the specific characteristics of the rural areas in the Republic of Serbia and the generally accepted principles of sustainable development (the economic, environmental and social ones), taking into account the interests of present and future generations. The paper analyzes the necessity and possible directions of the sustainable rural development of the Republic of Serbia. In this regard, the paper points to the significant role of the official state development policy in solving the problems of rural areas by establishing appropriate priorities and specific guidelines for future sustainable rural development. The conclusion is that the comprehensive and continuous work on the revitalization and development of rural areas is essential and must be in compliance with the principles of sustainable development. It is vital that the efforts towards sustainable rural development include significant investments, education programs, initiatives and activities of all development actors at the national, regional and local levels, as well as people directly involved in agriculture and agricultural production.
Zlata Đurić
The operation of business insurance companies, based on assuming risks of different profiles, is accompanied by fluctuations in the business environment. The complexity of predicting a financial effect for claims in non-life insurance lies in the structure of insurers’ liabilities, whose amount cannot be determined at the time of payment of the premium. By analyzing the key insurance processes, risk theory focuses on modeling claims as the financial consequences of unforeseen events. In addition, it provides the answer as to how much of a premium to charge in order to avoid bankruptcy, which makes it a complex and topical research area. The paper presents the main results of the collective risk model for the key business processes of nonlife insurance companies: the claim number process and the claim amount process. In risk theory, these are treated as stochastic processes, which offers a wide range of possibilities for the modeling and simulation of specific business problems.
Dragan Petrović
The subject of this paper is to analyze the evolution of approaches to the problem of the “state failure”. This phenomenon arose from the concept of “market failures”, which in economic theory can be seen in the context of searching for new strategies of the political and economic mechanisms of resource allocation. In this regard, special attention will be focused on the identification of the components of the institutional impact on the efficiency of economic processes, which first involves a general review of the role of the state in the economy. A multidisciplinary approach to the study of such a complex issue requires, among other things, that all information problems in the analysis of the economic functions of the public sector be taken into consideration, that the possibilities of financing public policy measures be appreciated, that the role and influence of the political process and the rent-oriented behavior of public officials be adequately evaluated, and ultimately that an attempt to identify the negative external effects caused by the absence, but also by the presence, of the state coordination in the economy be made.