International Financial Reporting Standards (EU)

— IAS 1 Presentation of Financial Statements — IAS 2 Inventories — IAS 7 Statement of Cash Flows — IAS 8 Accounting Policies, Changes in Accounting Estimates and Errors — IAS 10 Events after the Reporting Period — IAS 11 Construction Contracts — IAS 12 Income Taxes — IAS 16 Property, Plant and Equipment — IAS 17 Leases — IAS 18 Revenue — IAS 19 Employee Benefits — IAS 20 Accounting for Government Grants and Disclosure of Government

Assistance — IAS 21 The Effects of Changes in Foreign Exchange Rates — IAS 23 Borrowing Costs — IAS 24 Related Party Disclosures — IAS 26 Accounting and Reporting by Retirement Benefit Plans — IAS 27 Consolidated and Separate Financial Statements — IAS 28 Investments in Associates — IAS 29 Financial Reporting in Hyperinflationary Economies — IAS 31 Interests in Joint Ventures — IAS 32 Financial Instruments: Presentation — IAS 33 Earnings per Share — IAS 34 Interim Financial Reporting — IAS 36 Impairment of Assets — IAS 37 Provisions, Contingent Liabilities and Contingent Assets — IAS 38 Intangible Assets — IAS 39 Financial Instruments: Recognition and Measurement — IAS 40 Investment Property — IAS 41 Agriculture — IFRS 1 First-time Adoption of International Financial Reporting Standards — IFRS 2 Share-based Payment — IFRS 3 Business Combinations — IFRS 4 Insurance Contracts — IFRS 5 Non-current Assets Held for Sale and Discontinued Operations — IFRS 6 Exploration for and Evaluation of Mineral Resources — IFRS 7 Financial Instruments: Disclosures — IFRS 8 Operating Segments

International Financial Reporting Standards (EU): What is it?

International Financial Reporting Standards (IFRS) are standards based on principles approved by IASB. The IFRS was known earlier as International Accounting Standards (IAS) and Board of the IASC started it after 1973. Later in 2001, on the 1st of the month the International Accounting Standards Board (IASB) took the initiative and liability for the implementation of the Standards.

The Board implemented the International Standards in the very first meet itself. IASB has developed standards calling them IFRS. Both IASC and the IASB issue Interpretations of Standards.

The International Accounting Standards Board (IASB) is the autonomous, personal division and was shaped in 2001 to substitute the International Accounting Standards Committee (IASC). It emerges and endorses International Financial Reporting Standards. It is monitored by the IFRS Foundation.

The International Financial Reporting Standards Foundation is the sovereign, non-profit establishment, formed in 2000 to supervise the IASB. From 1973 until an inclusive wide-ranging in 2000, the constitution for setting up International book keeping principles was known as the worldwide book keeping Standards Committee. There was no exact "committee" of the similar name. The normal setting panel was known as the IASC Board.

IASC aims to establish and publish book keeping principles to be observed in the management of monetary statements and to encourage their universal approval and observance for the public. It also works usually for the development and management of policy, accounting principles and measures involving the presentation of monetary statements.

The objectives of IFRS are to build up a particular set of superior quality, easy to comprehend, easy to enforce (IFRSs) through the IASB. It also aims at encouraging the use and fast implementation of those standards. In Addition to this, it also takes the report of the monetary reporting needs of promising, medium-sized economic ventures and strives to get about a negotiation of nationwide accounting principles and IFRSs for quality solutions.

International Financial Reporting Standards (IFRSs) are from the IASB Standards. Unless and until All International Accounting Standards (IASs) and analysis issued by the earlier IASC are amended or withdrawn they would be implemented.

They are applicable to the common financial reports and other reporting by business entities, including those engaged in commercial, industrial, financial and similar activities, regardless of their legal stature.

IFRS may be suitable for non-profit-oriented business entities also. Financial statements based on the guidelines of IFRS intend to cater to the frequent requirements of shareowners, public, employees and the creditors by providing information about the monetary situation, routine, and money flows of an establishment.

This reporting also includes information regarding other issues which may affect the financial stature of an enterprise that would assist in the interpretation of a set of fiscal declaration or develops one's capability to make prudent economic decisions as IFRS apply to single business and combined financial reports. An absolute set of monetary report contains reports on monetary position, comprehensive income, cash flows, modifies in equity, bookkeeping policies and illustrative notes. If a separate revenue declaration is presented in accordance with IAS 1(2007), it is treated as part of the complete set.

While emergent values, IASB does not allow choices in secretarial management. It also proposes to re-evaluate the option in accessible IASs with an intention of dropping the quantity of those options. The basic principles presented by IFRS will be in both bold letters and non-bold category. Both have equal authority.

Many countries including European Union, Hong Kong, Malaysia, Turkey, Australia, Russia, India, South Africa, GCC countries, Singapore and Pakistan accept IFRS. There are around 113 countries, which includes Europe, which is permitting IFRS reporting. It is estimated that IFRS reports will be helpful for the populace using the financial details, as they reduce the costs involved in the getting the adequate information and planning for investments in alternative options.

Companies are also projected to do well, as company holders or lenders would be additionally eager to offer remuneration, optimistic by the information. Companies involved in intense international trading would gain from reports from IFRS. Foreign investors also benefit as an accepted accounting standard is in force. But there has been some skepticism about the cost that may incur for the international standard.

It is argued that implementation of the principles may not be tight enough and adding to it the provincial differences in secretarial may get masked by a tag. There was also the worry about the value of IFRS in addition to the attitude of accountants of different countries with different laws regarding losses which may not be anticipated before it was too late.

Though the transition to International Financial Reporting Standards can be categorized into various phases, five stages to achieve International Financial Reporting Standards readiness have been accepted.

While the economic scenario in world seems on the verge of a change almost every day, the authenticity of IFRS statement is the one thing that the investor and businessman alike can rely on. These statements are accurate guidelines so far as they give an impartial and non-prejudiced report on financial undertakings and go with the trend of the moment.

As IFRS is not interested in making any profit its reports on financial institutions are believed to be true as far as facts and figures go. Any upward or downward trend is carefully studied before the report was prepared. Utmost care would be taken to ensure that the public, particularly the investor was not misguided. The IFRS reports are created by concentrated survey and monitoring and extreme care would be taken to avoid misguidance.

The annual or periodic reports were prepared according to the investment trend so as to assist the investor. The IFRS reports can be interrupted in various countries according to their norms and laws and made easy for the common man to understand and utilize them better.

While the business community is a close knit community there are ample opportunities to err and the investor may end up in financial trouble. Also while the IFRS provides non-biased reports on the financial position of business institutions it would be prudent on the part of the investor to have first hand knowledge as far as possible.

The following list contains Europe Union officially accepted IFRS standards. Note that it's not "pure" IASB standards, but EU adopted version of IFRS.

The Difference Between Product and Process Controls

It’s been thirty days, and the eagerly awaited letter from the agency is expected today. Despite the usual last minute preparations, the submission went in on time and complete. All of the pre-clinical studies looked good, so it should be approved without comment. When the letter finally arrives, the Regulatory Affairs associate tears open the envelope and a list of questions fall out. What was the problem? There were insufficient controls to guarantee patient safety.

Unfortunately, scenes like this are all too common. Failures to establish the proper controls are one of the major reasons why submissions are rejected. While it is not the responsibility of Regulatory Affairs (RA) to ensure the product is manufactured correctly, RA is often the only quality guidance on a new product development team comprised of engineers, scientists, physicians, and managers. The focus of this article will be to identify the major components of process and product control quality systems so that RA professionals can better understand the requirements.

Product ControlsQuality systems that focus on sorting and isolating defective product are generally called product controls. Because the process generates defective product, efforts are made to identify, sort, and segregate the defective product. Often, the defects are made throughout the process but only culled at the end. For example, a manufacturer sells a sterile original equipment manufactured (OEM) part. The part is made from a metal press, where it is etched with a lot number, cleaned, packaged, and steam sterilized. Prior to shipment, samples of the sealed product are inspected. If the metal press caused hairline cracks to form in the part, then this may be detected only at the very end of the process. All of the cleaning, labeling, packaging, and sterilization are wasted on essentially defective product. Because defective product is definitely present, product controls require 100% inspection or multiple 100% inspections to guarantee product quality. Statistical sampling plans are not useful because they presume an acceptable defect level of a few percent, which is generally not acceptable for Food and Drug Administration (FDA) regulated products.

Management also must be prepared to accept the greater costs that come with a quality system founded on product controls. Management issues are important to understand in that frequently these choices are made without consideration until a decision is required. It is at that time that RA is asked to change submissions, approve altered specifications, or release deviated product, a compliance nightmare that most want to avoid. Higher inventories are required to accommodate all of the inspection steps. Likewise, with a proportion of all production being scrapped, manufacturing will need to buffer that with higher production levels as well. Greater waste will be generated as value is added to defective product. Management must be willing to tolerate the loss of entire lots of product, as some errors will be unrecoverable. In the example above of a metal stamped part with a hairline crack, it would be impossible to determine the extent of the nonconformity, and presumably it would affect all parts stamped with that die. In that

case, all of that lot and every lot manufactured since would have to be scrapped or substantially reworked.

In order to have quality system based on controlling product, robust systems for material control, calibration, maintenance, and rework (as applicable) are required. The process starts with material control. Segregated areas for material hold pending inspection, hold pending rework, hold after rework, rejected materials, and released materials are recommended as a minimum. If there are multiple inspections, further areas are advisable to prevent the product from bypassing an inspection step. Regardless of the nature of the material control, the FDA will be most concerned with assuring no mix-ups occur between any of the areas, ensuring all of the product goes through every inspection step, and that unreleased product does not leave the facility. Will the product be adequately labeled indicating inspection status? What happens if a single unit is found outside of the hold areas? Is it scrapped or does a cost conscious operator mistakenly put it in the released area?

Keeping the equipment calibrated and maintained will be even more critical in a product control quality system since it is really the only evidence that the product meets requirements. Any problems or shortcomings of the equipment can have disastrous consequences (i.e. recall). All measurement equipment used to verify the product meets the requirements will have to be calibrated and maintained in accordance with approved procedures. The measurement procedures will have to be shown to be accurate and precise with respect to the application. For example, a syringe will have a specification for diameter. The organization may choose to use pin gauges to verify the diameter is within the specification. In order to do this, the gauges will have to be kept calibrated, free from dirt, grease, and corrosion, and approved procedures on how to execute the measurement developed. Are inspectors suppose to use every pin gauge to get the exact measurement of the diameter or can they just use the gauges corresponding to the specification limits to verify the diameter is within specification? Agency concerns will be ensuring that the calibrated equipment is used and not substituted for another, all of the procedures are followed as directed, the measurement procedures are validated, and if the equipment is subsequently found out of calibration, how was product quality assured. This will drive calibration frequency, as well. If a measurement is made with a piece of equipment calibrated quarterly, what happens if it is found out of tolerance? All of the product released over the last three months is now in question, and in a product control quality system, there is little to fall back on to ensure the product is within specification.

If rework is possible, then this will be an area of great concern to the agency. In a product control environment, routine rework and the redress of nonconforming product will be closely scrutinized. The rework procedures must be very precise as to which kind of defects they apply to, which product stages they apply to, and how the rework will be verified as effective. It goes without saying that the rework procedures will have to be validated. Additional attention must be paid to ensure that the non-conforming product has been completely redressed to bring it to the level of regular product.

Process Controls

Process controls are quality systems based on preventing defects by controlling and monitoring manufacturing processes. Because no defective product is produced, these processes can achieve much higher quality levels than a system based on product controls. Processes must be rigorously characterized, understood, and controlled for this system to be effective. For example, a pharmaceutical manufacturer typically combines a number of drug components into a heated batch reactor, mixes them thoroughly, dries them in a granulator, and compresses them into tablets. Process controls for this operation would include specifications on batch size, mixing speed, drying temperature, mixing temperature, drying time, mixing time, and speed at which pellets are compressed. These are distinct from product specifications in that they will be different depending on the equipment used.

While process controls are less focused on final product inspection, they can be difficult to implement with the increased requirements on documentation, calibration, and measurement equipment. Since the manufacturing process must be well understood, quality systems based on process controls tend to have more procedures. Specifications increase greatly as the focus shifts from product to process. A single product requirement, like the tensile strength of a catheter, could be translated into several extrusion process controls. Cooling bath temperature, screw speed, extruder temperature, and air temperature could all be defined in the process specifications. Furthermore, these additional controls must be measured with calibrated instrumentation. In some cases, instrumentation will have to be developed or improvised. If a chemist makes a batch in a beaker on a combination magnetic stirrer / hot plate, he or she may have no idea of the exact volume, mixing speed, and average temperature. Beakers are not that accurate, stirrers typically have a knob from 1 to 10, and hot plates do not evenly heat. In order to implement process controls, a method for measuring the temperature, stir speed, and volume would have to be developed. While a calibrated thermometer and tachometer would do for part, detailed procedures on how much material is added would be required to ensure constant volume.

Management expectations must also be aligned with the realities of process controlled operations. With the increase in specifications, the organization must be very disciplined about following procedures. While some claim this stifles innovation, in truth it reduces variation permitting a better understanding of cause and effect. Management also must come to terms that process specifications will be just as important as product specifications, and they are an accept/reject criterion. It is one thing to scrap a lot of product that is clearly nonconforming, but it is something else to trash a lot of product because an abstract parameter was out of tolerance. For example, if a plastic coating process leaves uncoated segments of wire, it is clearly defective and can be scrapped without too much fuss. Alternatively, if the same plastic coating process ran at a line speed beyond the tolerance and studies have shown that this will lead to thin spots in the plastic, but they are not observable, some managers will balk at rejecting this product. Management must also be willing to tolerate the increased costs associated with calibration and hiring statistically literate personnel. Process controls often require statistics to determine optimum set points and monitoring frequencies.

The two most important quality systems in a process control environment are process validation and change control. Because the process specifications will be used to release product in lieu of product inspections, the process validations will be more numerous and rigorous. Validations for assembly, packaging, cleaning, software, utilities, and general manufacturing are all common to process control environments. Each process should be shown to be statistically capable with process capability indices in excess of 1.33. Change control must also be thoroughly implemented. This includes changes to equipment, software, hardware, and gauges used in validated processes. Often these changes are presented as like-for-like, but often process controls are equipment specific and the response of a motor, gauge, or sensor may be different depending on the supplier. A change that would be easily approved in a product control environment can require complete revalidation in a process control environment.

The FDA generally looks favorably upon process controls since they lead to higher quality product. Be assured they will closely examine equipment validation files, change controls, and product release records to ensure they are all in alignment. It is important that all of the process parameters identified during validation are reflected in the ongoing inspection records for the production lot. This can also be audited by a physical walk-through to ensure that all of the gauges specified in the batch records are present and working.

ConclusionsWhich system is better? Product controls are usually quicker and easier to implement with more variability permitted in the processes. Oftentimes, the higher margins associated with FDA regulated products cushion the economic impact of running a product control operation. Process controls are definitely more compliant than product controls and have less overall cost. Unfortunately, many organizations are unable to achieve process controls because of the discipline required. A hybrid operation is then implemented incorporating some of the elements of process controls, but relying on a final product inspection as a final check of the process.

Nonparametric testsOccasionally, the assumptions of the t-tests are seriously violated. In particular, if the type of data you have is ordinal in nature and not at least interval. On such occasions an alternative approach is to use nonparametric tests. We are not going to place much emphasis on them in this unit as they are only occasionally used. But you should be aware of them and have some familiarity with them.

Nonparametric tests are also referred to as distribution-free tests. These tests have the obvious advantage of not requiring the assumption of normality or

the assumption of homogeneity of variance. They compare medians rather than means and, as a result, if the data have one or two outliers, their influence is negated.

Parametric tests are preferred because, in general, for the same number of observations, they are more likely to lead to the rejection of a false hull hypothesis. That is, they have more power. This greater power stems from the fact that if the data have been collected at an interval or ratio level, information is lost in the conversion to ranked data (i.e., merely ordering the data from the lowest to the highest value).

The following table gives the non-parametric analogue for the paired sample t-test and the independent samples t-test. There is no obvious comparison for the one sample t-test. Chi-square is a one-sample test and there are alternatives to chi-square but we will not consider them further. Chi-square is already a non-parametric test. Pearson's correlation also has non-parametric alternative (Spearman's correlation) but we will not deal with it further either.

There are a wide range of alternatives for the two group t-tests, the ones listed are the most commonly use ones and are the defaults in SPSS. Generally, running nonparametric procedures is very similar to running parametric procedures, because the same design principle is being assessed in each case. So, the process of identifying variables, selecting options, and running the procedure are very similar. The final p-value is what determines significance or not in the same way as the parametric tests. SPSS gives the option of two or three analogues for each type of parametric test, but you need to know only the ones cited in the table. Same practice with these tests is given in Assignment II.

Parametric test Non-parametric analogue

One-sample t-test Nothing quite comparable

Paired sample t-test Wilcoxon T Test

Independent samples t-test Mann-Whitney U Test

Pearson's correlation Spearman's correlation