Question

The value of international accounting standards has been discussed for a number of years, but with the increased global activity in business in recent history, the need for such has grown in importance. As you may have discussed in financial accounting courses or have seen in business news reports, the international standards [IFRS] have been in use by a number of countries, but not the US. The US has continued to report under GAAP, but the FASB is currently in process of the convergence of the two sets of standards, amid much debate, including the impact convergence may have on SEC reporting for US companies and the adequacy of the international standards in addressing complex issues.

Should the US move ahead with the convergence of GAAP and IFRS? Why or why not?

Answer 1

Contentions for the meeting are (a) reestablished clearness, (b) conceivable disentanglement, (c) straightforwardness and (d) likeness between various nations on bookkeeping and money related detailing. This will bring about an expansion of capital stream and worldwide ventures, which will additionally decrease financing costs and prompt monetary development for a particular country and the organizations with which the nation conducts business. Opportuneness and the accessibility of uniform data to every single concerned partner will likewise thoughtfully make for a smoother and more productive process. Also, new defends will be set up to keep another national or universal monetary and budgetary emergency.

Contentions against bookkeeping models meeting are (a) the unwillingness of the diverse countries engaged with the procedure to team up in view of various societies, morals, measures, convictions, kinds of economies, political frameworks, and assumptions for particular nations, frameworks and religions; and (b) the time it will take to actualize another arrangement of bookkeeping principles and gauges no matter how you look at it.