Contemporary Issues in Accounting: Convergence of International Financial Reporting Standards

Running Head: CONTEMPORARY ISSUES IN ACCOUNTING
CONTEMPORARY ISSUES IN ACCOUNTING
Name of the Student
Name of the University
Author Note

1CONTEMPORARY ISSUES IN ACCOUNTING
Abstract
Since, from the last few decades, there has been great demand for the uniformity of
the accounting that is becoming much stronger. There are organizations who are
expanding their business across the borders of the country. Moreover, because of
the differences in the accounting standards and the financial reporting, the hurdles
are created in the financial comparisons at international level as well. Therefore, for
solving this problem, International Accounting Standards Board has come has
introduced the concept of the unified standards of accounting that is International
Financial Reporting Standard. Some countries have already adopted this particular
resolution but more efforts are needed from other countries as well. Hence, this
paper will discuss convergence of the International Financial Reporting Standards
that have resulted in the harmonized international accounting practices across the
countries.

2CONTEMPORARY ISSUES IN ACCOUNTING
Table of Contents
Introduction...............................................................................................................................3
Research Objective.................................................................................................................3
Literature Review.....................................................................................................................4
Global Convergence of International Financial Reporting Standards.........................4
Measurement of the Financial Reporting Quality in Developed and Developing
Countries...............................................................................................................................6
Basis of Preparation of Financial Statement...................................................................8
Convergence of IFRS leads to Improved Financial Reporting Quality.....................10
Research Methodology.........................................................................................................11
Conclusion..............................................................................................................................12
Reference...............................................................................................................................13

3CONTEMPORARY ISSUES IN ACCOUNTING
Introduction
The aim of this assignment is to do the analysis on the convergence of
International Financial Reporting standards. The increase in the convergence has
resulted into the harmonization of the international accounting practices across the
countries that have grown over the last ten years. Several studies are conducted in
this relation. Hence, under this report, discussion will be done on factors that drive
the globalized convergence of International Financial Reporting Standard. Moreover,
review of the research articles will be done for explaining the way in which the quality
of the financial reporting is measured in the developed as well as developing
countries. Further, two companies will be taken into considerations and comparison
will be done on the financial statements of each company. First company will be
Nepal based company Himalayan Distillery Limited, which is leading manufacturing
company of alcoholic beverage that is listed in the Nepal Stock Exchange. The
second company that will be considered will be Australian Vintage Limited, which is
listed in the Australian Stock Exchange that is the leading Australian wine company
and they are the largest owners of vineyard and managers of Australia. Lastly,
discussion will be done on whether the convergence of IFRS will lead to the
improved financial reporting quality.
Research Objective
This research is having the objectives for answering the following question:
 What are the factors that drive global convergence of International Financial
Reporting Standards?
 How quality of financial reporting is measured in the measured as well as
developing countries?