Question

Considering the viewpoint of Governments

Two disadvantages of international accounting standards

Answer 1

Two disadvantages of international accounting standards from the viewpoint of the government

• Cost burden may disproportionately affect small to mid-sized companies

Regardless of how sensible the new worldwide bookkeeping norms received might be, organizations will even now be required to acquire critical expenses as they progress from the United States' current sound accounting standards (or GAAP) framework to the IFRS or other substitute worldwide bookkeeping framework. Expansive organizations may discover the change costs related with preparing representatives and setting up new practices to be difficult, however most enterprises of huge size won't discover such costs restrictive. Little and average sized organizations, then again, may effortlessly discover the cost trouble related with progressing from their current working bookkeeping framework to another all inclusive agreeable framework overpowering. New directions quite often affect littler organizations more than bigger ones.

At last, globalization is influencing the world's economies in heap ways, and bookkeeping benchmarks shape only one aspect of numerous frameworks affected. Regardless of whether an arrangement of bound together worldwide bookkeeping gauges is received or not, U.S. organizations should confront the advantages and disadvantages of globalization in connection to their very own bookkeeping hones.

• It is not globally accepted.

Truth is, the US has not yet adopted the international accounting standards, so as other countries that choose to continue holding out as well. This means that accounting by foreign companies operating in these countries are facing difficulties because they have to prepare financial statements using such a set of standards and another set of principles that are generally accepted in these countries.

• Although many countries have adopted IFRS, there are also significant hold-outs