At the national level, it is important that governments, regulators, and national standard setters place international convergence as a priority on their agendas. At the international level, it is important that the international standard setters establish processes and procedures that facilitate national input and lead to the development of high quality standards that are globally accepted; (4) Finally, it is clear that to achieve international convergence, action is necessary at all points along the information supply chain that delivers financial reporting. Boards of directors and management, who have the primary responsibility for financial reporting, as well as auditors, standard setters, regulators, and other participants in the financial reporting process, such as lawyers, investment bankers, analysts, credit rating agencies, and educators, all have important roles to play in achieving international convergence. (2004) The work of Hegarty, Gielen and Barros entitled: "Implementation of International Accounting and Auditing Standards: Lessons Learned from the World Bank's Accounting and Auditing ROSC Program" states that: "High quality financial reporting contributes to promoting private sector growth and reducing volatility through:

1) Strengthening countries' financial architecture and reducing the risk of financial market crises, together with their associated negative economic impacts;

2) Contributing to foreign direct and portfolio investment;

3) Helping to mobilize domestic savings;

4) Facilitating the access of smaller-scale corporate borrowers to credit from the formal financial sector by lowering the barrier of high information and borrowing costs;

5) Allowing investors to evaluate corporate prospects and make informed investment and voting decisions resulting in lower cost of capital and better allocation of resources and (6) facilitating integration into global financial and capital markets." (Hegarty, Gielen and Barros, 2004)

Secondly financial reporting is also stated to be a: "...building block of a market-based monitoring of companies, which allows shareholders and the public at large to assess management performance, thus influencing its behavior." (Hegarty, Gielen and Barros, 2004) Third stated is the fact that: "High quality financial reporting also contributes to strengthening the financial discipline of Government Business Enterprises (GBEs)." (Hegarty, Gielen and Barros, 2004) Additionally "high quality financial reporting may also contribute to improving the assessment and collection of taxes on corporate profits." (Hegarty, Gielen and Barros, 2004) Fifth stated is: "As an institution committed to the fight against poverty, the World Bank undertakes a number of activities to support the development and implementation of international accounting and auditing standards, as it recognizes the contribution that high-quality financial reporting can make to development" including activities of "financial support to the relevant international standard-setting organizations; diagnostic work to benchmark countries' financial reporting standards and practices against international standards; policy advice and financial assistance to support the enhancement of these standards and practices; and participation in international discussions and initiatives aimed at strengthening the regulatory environment, both nationally and globally, in which international standards are applied." (Hegarty, Gielen and Barros, 2004) Hegarty, Gielen and Barros state that certain impediments to the successful implementation of international standards exist and the first of which is "misunderstanding as to the nature of international standards." (Hegarty, Gielen and Barros, 2004) a clear understanding of the standards in relation to what the standards are, why the standards exist and what it means for a country to adopt these standards are "fundamental to the implementation of international accounting and auditing standards." (Hegarty, Gielen and Barros, 2004) Without having this understanding countries are not able to set "concrete implementation targets or to measure progress in reaching those targets." (Hegarty, Gielen and Barros, 2004)

The findings of the ROSC "suggest that clarity of understanding is not universal, which helps to explain the sometimes significant gaps between prior self-assessments of compliance - such as those published by the International Accounting Standards Board (IASB) and International Federation of Accountants (IFAC) - and the ROSC results." (Hegarty, Gielen and Barros, 2004) Adoption processes relating to international accounting standards has been differentially interpreted by countries in the transition which serves to "hamper rigorous and uniform application of IAS." (Hegarty, Gielen and Barros, 2004) Secondly identified by Hegarty, Gielen and Barros is a "lack of appropriate mechanisms for granting national authority to international standards" and stated is that in order to be effective "in a national setting, international standards require the force of law or other regulatory backing. If not, compliance becomes a matter of non-transparent discretion on the part of preparers and...

In such cases the standards should more properly be considered 'offshore' rather than 'international'." (Hegarty, Gielen and Barros, 2004) Presently, there exists no international consensus "on what mechanisms should be used to provide regulatory backing, and different countries have adopted different approaches, many of which fail to achieve their stated objective. Countries are also bound by their constitutional and administrative law, which can limit significantly their ability to impart domestic legal force to international standards issued by non-official private organizations." (Hegarty, Gielen and Barros, 2004) the accountancy profession does not have "sufficient authority to ensure their successful implementation, unless acting in a regulatory capacity derived from specific legislation." (Hegarty, Gielen and Barros, 2004) Secondly, in this area of impediments Hegarty, Gielen and Barros state that countries that historically rely on laws and regulations rather than on standards for fixing requirements of auditing and accounting requirements there are specific issues to deal with. Instead of granting authority to a continuous process of standing setting "...new statutory measures are required whenever a new international standard is enacted, or an existing international standard is amended. Typically, such changes must be gazetted in the official language of the country." (Hegarty, Gielen and Barros, 2004) This approach generally leads to delays in keeping translation of the IAS/IFRS up-to-date; "...this approach also entails significant costs and technical difficulties or carrying out translations." (Hegarty, Gielen and Barros, 2004) Those who prepare these translations face difficulties as well in that they desire to comply with domestic law and current IAS/IFRS and these two are often not aligned. Additionally, in the instance where the procedures are combined "with an explicit endorsement mechanism to screen individual international standards for local adoption there is the further possibility that certain IAS/IFRS may not be accepted, either in full or in part." (Hegarty, Gielen and Barros, 2004) it is stated that attention should be given to "the political significance of introducing a mechanism that may deprive a jurisdiction of the ability to have final say over the standards to which it grants legal authority." (Hegarty, Gielen and Barros, 2004) the third impediment identified are the "inconsistencies between international standards and legal framework" and international standards." (Hegarty, Gielen and Barros, 2004) Several stress areas between domestic laws and the standards which have a potential to negatively impact compliance and monitoring and enforcement efforts.
The fourth identified impediment in the work of Hegarty, Gielen and Barros is "lack of appropriate linkages between general -purpose financial reporting and regulatory reporting." (2004) it is stated that the IAS/IFRS are standards "for the preparation of general-purpose financial statements, aimed at meeting the needs of a wide range of users, but predicated on the assumption that placing primary emphasis on the needs of shareholders will result in measurement, recognition and disclosure requirements that also meet the needs of other users. However, significant other users of financial statements need not necessarily share this view, and where they have the power and authority to do so, frequently impose different special-purpose financial reporting obligations designed to meet their specific needs." (Hegarty, Gielen and Barros, 2004) This interface between general-purpose and regulatory reporting is not managed successfully by all countries. The voluntary option that companies possess in preparing additional financial statements "in which full compliance with IAS/IFRS can be achieved, but this has negative costs implications and also raises uncertainties among users as to which are the 'real' figures." (Hegarty, Gielen and Barros, 2004) Additionally, financial statements prepared and audited on the basis of the company having volunteered "typically fall outside the scope of domestic regulatory regimes, thereby often reducing the reliance users can place on them." (Hegarty, Gielen and Barros, 2004)

Listed as the next impediment in the work of Hegarty, Gielen and Barros (2004) is "inappropriate scope of application of international standards" as use of full IAS/IFRS are not appropriate for all entities. "Many countries have traditionally applied a single set of accounting requirements to all companies or all companies using a specific legal form, irrespective of size. However, the use of IAS/IFRS as that single set of requirements has frequently led to unintended negative consequences, hindering successful implementation, as full IAS/IFRS are not appropriate for small and medium sized entities." (Hegarty, Gielen and Barros, 2004) in these cases, the "necessary capacity for proper application was often not in place, costs of compliance were disproportionate, and enforcement bodies either did not exist or were unable to cope with the volume of work required." (Hegarty, Gielen and Barros, 2004) Compliance suffers…