Benefit of more flexibility in accounting Question Answer 2022

ACCOUNTING THEORY
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ACCOUNTING THEORY
Name of the Student
Name of the University
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ACCOUNTING THEORY
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Answer 1
Since the Continental European countries relied mostly on internal investors, the
periodical reports made by the accountants and the accounting profession was considered weaker
and trivial in terms of influence. On the other side, Countries like the United States of America,
United Kingdom, Canada and Australia who raised funds from external investment sources saw a
huge accession in demand for professional accountants. As a result of this, they were weighed as
comparatively stronger in numbers, in terms of duties performed, judgements made and
influence.
Answer 2
The countries which adopted IFRS have witnessed a lot of advancements, and some of
the salient benefits they procured are added below
 A significant decrease in time, money, physical and mental efforts in preparation of
periodical reports.
 Easier to control and oversee
 The benefit of more flexibility in accounting
 Huge increase in the number of Foreign Direct Investments made
 Compared to GAAP in 2004-06, much higher return on equity of 70%
 A sole authoritative body to govern reports
 Huge investments in small and medium scale enterprises
Answer 3(a)
 Compared to US GAAP, reports prepared under IFRS provide investors with accurate
and larger data.
 Assists and supports investors in making decisions.