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¶ … economic globalization over the past twenty years sparked demand for a single, worldwide set of high-quality accounting standards" (Benjamin 2012). The SEC's allowance for American companies with international holdings to use IFRS supports convergence to some extent by providing an incentive for filers to use IFRS. Companies that use IFRS can be compliant with both U.S. And international filing requirements, without having to keep 'double books.' All firms with an international scope are now likely to consider using IFRS because of its compatibility with U.S. And worldwide standards. Given the globalization of the economy, even small and mid-sized U.S. organizations may begin using IFRS, which will make firms which use GAAP more isolated. Convergence will be facilitated, with a likely bias in the new, universal standards towards using IFRS with minor (or no) modifications.
Q2. The EU is one of the most powerful trading blocks in the world. The wholesale adoption of a single accounting standard strongly resembling IFRS will be incentivized by the EU's economic integration, given that more companies will likely be doing business with...
For ordinary shareholders, having a single type of financial reporting system makes it far easier to compare the financial performance of different companies. There are substantial differences between GAAP and IFRS that can make direct comparisons between companies using the different systems difficult, even for an accountant, much less an ordinary shareholder. For example, "GAAP contains more detailed, specific requirements than IFRS [because] IFRS contains broad principles to account for transactions across industries, with limited specific guidance and stated exceptions to the general guidance" (Benjamin 2012).
It should be noted that this is a frequently-cited reason for the benefits of using IFRS -- it is easier to understand, less technical, and many argue, more ethical, given that there is less potential for adhering to the 'letter' while still engaging in unethical conduct that violates the 'spirit' of accounting ethics, one criticism frequently leveled against GAAP. "Principles-based systems offer broader guidelines in accounting treatment,…
References
Benjamin, Michael. (2012). IFRS convergence: What it means and where it stands. BPM.
Retrieved:
http://www.bpmcpa.com/Library/IFRS-Convergence-Update-Feb-2012.asp#.UT_JkFesf5N
Schneider, Bob. (2013). Accounting basics. Investopedia. Retrieved:
http://www.investopedia.com/university/accounting/accounting6.asp#axzz2NNQt7MiE
http://www.ifrs.org/news/features/Pages/adopt-adapt-converge.aspx
For instance the World Trade Organization reports having "allowed First World countries to raise trade barriers protecting their companies, even as we have served as their forum for insisting that Third World countries lower their trade barriers more and more." (WTO, The truth is that if richer nations were to open their markets to the LDC countries for increase opportunities of export, generated would be approximately $700 billion in additional
The global "mindset" that companies must have is defined as "…the ability to develop and interpret criteria for business performance" that are not relying on the "assumptions of a single country, culture or context to implement those criteria appropriately…" (Begley, et al., 2003). Begley and colleagues insist that the "truly globalized corporation" sees globalization as more of a "mind-set" than a "structure" per se (p. 1). The three mind-sets that
Globalization=Western Imperialism Modern science and all the various process that are involved with the modernization process evolved because of the progress made by the western countries and the progress made in the field of science, medicine and the notions held in respect of human rights and liberty. There are several sections of individuals who state that dissatisfaction that people seem to have is that they are troubled with their daily life.
Bush implied unemployment figures were declining and Kerry touted very high unemployment figures. In hindsight, it appears that the labor department statistics concurred with the Kerry camp. When Bush still won, unemployment trend indicators seem to be coming true now and there seems to be more problems on the horizon for the economy. The Bureau of Labor Statistics indicated recently that new jobs being created in the economy were
S. pp). For more than ten years, Chinese officials have stated that production from Chinese firms investing overseas is more secure than imports purchased on the international market (U.S. pp). In order to secure more reliable access, Chinese firms are being directed to invest in projects in the Caspian region, Russia, the Middle East and South America (U.S. pp). The National Intelligence Council's report also states that Europe's energy needs will
Globalisation leading cultural damage exploitation uderdeveloped nations peoples." It include (a) Definitions "Globalisation" (b) Logic linking globalisation free market processes liberal creed. Negative effect of globalization to under developed countries Globalization has been a widely discussed topic among various authors, economics and business analysts and its' from the studies and research that the essay has been built on. First the essay will explain what globalization is and some of the characteristics of