Harmonization of International Accounting Standards

presentation\n\nAs there has been a tremendous growth in the market place with the existent story practices, this leads us to ca found why do we charter harmonization of Inter subject accounting system standards, what are its advantages and what are the barriers that obturate harmonization? Although accounting may be the language of business, a common language has never been inevitable -- at least(prenominal) as long as the piece economy consisted of a set of much or less distinct study economies.\n\n(Mednick 1991) (Cited in: www.wetherhead.cwru.edu) This, however, is no lengthy true. We now down a orbicular economy and it has impact the entire business world. For instance, todays spherical corporation may vex more than one headquarters, and its achievement and distribution facilities are belike scattered throughout the world. trade good prices, interest rates and currency exchange values have become internationally link -- with the result that governments arou nd the world are increasingly livelihood harmonization of accounting practices and national policies. (Walters) (Cited in: Bisgay and Jayson 1989) Harmonization is necessary because standard national monetary statements are virtually idle; monetary markets in more regulated countries are exist with a loss of market share; and multinational corporations mustiness prepare multiple reports for divers(prenominal) nations they do business in. (Nobes and Parker 1991) (Cited in: http://ecocomm.anu.edu.au) There is a pauperization for harmonization for accounting standards in order to help the orthogonal investor to understand the monetary statements of the distant companies whos shares they might fatality to buy.(Iqbal, Melcher and Elmallah 1997) pecuniary in unionizeation is a diverseness of a language. And if the language of financial information is to be put to use, so that investment and credit entry decisions can more right away be taken, it should not totally be inte lligible, it should also be comparable.\n\n(Belkaoui 1994) These new environmental factors of the global economy, the international monetary system, the transnational Corporation and foreign contribute investment create an environment in which business transactions, their conduct, quantity and disclosure, takes new and distinctive form that call for a particular accounting sub redress or the harmonization of accounting practices.\n\nAdvantages of Harmonization\n\n(Turner 1983) The greatest gain that would flow from harmonization would be the comparability of international financial information. Such comparability would refuse the current misunderstandings about the reliableness of foreign financial statements and would channelise one of the most big impediments to the flow of international investment. (Choi, frost and Meek 1999) Harmonization would...If you want to get a integral essay, order it on our website:

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