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Convergence of Financial Accounting Standards

   

Added on  2020-01-07

7 Pages1558 Words162 Views
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Advanced FinancialReporting
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Table of ContentsINTRODUCTION...........................................................................................................................3Main Body.......................................................................................................................................3Conclusions......................................................................................................................................6REFERENCES................................................................................................................................7
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INTRODUCTIONGlobalisation refers to the free activities and movement under which people andcooperation freely exchange the goods, capital, services, technology and information from onecountry to another country (Abernathy, Beyer and Stefaniak, 2014). It is an action andintegration among the countries about the products, idea and other aspect of culture.Globalisation of accounting standards are process which defines that how accounting standardsare work at the international level and how it applied in the international business in the world. Inaddition to this various drivers towards globalisation of accounting standards, barriers towardglobalisation of accounting standards, progress, current status of IFRS as global accountingstandards and future of convergence project are also discussed in this report.Main BodyThe international financial reporting standards are that standards which is issued by theIFRS. It provides a common global language for business affair so that organisation account areunderstandable and comparable across international boundaries. IFRS are the set of accountingstandards which is developed by International Accounting Standards Board (IASB). Because ofglobal expansion of accounting standards, many countries who trade outside their geographicalarea, it becomes easier for them to address the needs of the clients. Due to the global expansionof Accounting standards, it attracts large number of international investors and clients. In the1904, St Louis in the US in the international congress of accountants was an event that Igenerally accepted as a beginning of initiatives directed to harmonization of accounting rules. Ina simple word it can be said that international accounting standard are a manifestation ofglobalisation, with financial reports which is prepared under the IFRS presenting an imageconsistent with that of multinational organisation and developed countries. By this internationalfinancing reporting standards, many developing countries and emerging economies gain thebenefits (Armstrong, Guay and Weber, 2016). However, they also have to face the severalchallenge related to adapting their regulatory infrastructure and culture to western orientedaccounting standards.Harmonisation:By fixing the limits of the degree of variation, company can bale to enhance the compatibility ofaccounting practices is known as the harmonisation in the accounting. In a simple term it can be
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