international accounting
CASE ASSIGNMENT
INTERNATIONAL FINANCIAL REPORTING STANDARDS
MASTER OF SCIENCE IN BUSINESS
EK337EPERSPECTIVES ON INTERNATIONAL ACCOUNTING
SPRING 2013
CANDIDATE NUMBERS:
28
32
76
87
UniversitetetiNordland
1
CONTENT
Introduction……………………………………………………..3
Theoretical Framework………………………………………….5
Advantages……………………………………………………....5
Disadvantages…………………………………………………....6
Challenges………………………………………………………..6
Analysis………………………………………………………….7
Conclusion………………………………………………………10
References……………………………………………………….12
2
Introduction
International Financial Reporting Standard (IFRS) are a set of accounting standards developed by the International Accounting Standard Board (IASB). These are becoming the global standard for the preparation of public company financial statement. The goal of
IFRS is to provide a global framework for how public company prepare and disclose their financial statements. It provides general guidance for the preparation of financial statement, rather than setting rules for industry-specific reporting. With the increasing globalization, business enterprises found difficulty in using different accounting standards for exchanging and sharing financial results of their business activities. It served as a hindrance in smooth flow of financial information. It was not possible to compare financial results if the business enterprises were using different accounting standards. So, business professional around the world recognized the need of common universal set of accounting standards.
Having an international standard is especially important for large companies that have subsidiaries in different countries. Adopting a single set of worldwide standards will simplify accounting procedures by allowing a company to use one reporting language throughout. A single standard will also provide investors and auditors with a cohesive view of finances. In order to develop and maintain globally accepted accounting
INTERNATIONAL FINANCIAL REPORTING STANDARDS
MASTER OF SCIENCE IN BUSINESS
EK337EPERSPECTIVES ON INTERNATIONAL ACCOUNTING
SPRING 2013
CANDIDATE NUMBERS:
28
32
76
87
UniversitetetiNordland
1
CONTENT
Introduction……………………………………………………..3
Theoretical Framework………………………………………….5
Advantages……………………………………………………....5
Disadvantages…………………………………………………....6
Challenges………………………………………………………..6
Analysis………………………………………………………….7
Conclusion………………………………………………………10
References……………………………………………………….12
2
Introduction
International Financial Reporting Standard (IFRS) are a set of accounting standards developed by the International Accounting Standard Board (IASB). These are becoming the global standard for the preparation of public company financial statement. The goal of
IFRS is to provide a global framework for how public company prepare and disclose their financial statements. It provides general guidance for the preparation of financial statement, rather than setting rules for industry-specific reporting. With the increasing globalization, business enterprises found difficulty in using different accounting standards for exchanging and sharing financial results of their business activities. It served as a hindrance in smooth flow of financial information. It was not possible to compare financial results if the business enterprises were using different accounting standards. So, business professional around the world recognized the need of common universal set of accounting standards.
Having an international standard is especially important for large companies that have subsidiaries in different countries. Adopting a single set of worldwide standards will simplify accounting procedures by allowing a company to use one reporting language throughout. A single standard will also provide investors and auditors with a cohesive view of finances. In order to develop and maintain globally accepted accounting