SIMILARITIES AND DIFFERENCES OF INTERNATIONAL ACCOUNTING

Similarities and Differences of International Accounting

Similarities and Differences of International Accounting

Throughout the annals of accounting, both the public and private part of the business world pursue certain guidelines and principles, in alignment to report economic statements in a clear and reliable manner. In the joined States, these guidelines are the usually Accepted Accounting Principles (GAAP). However, in other countries another set of values has been conceived for them to follow, these are the worldwide Financial describing Standards. Recently, accounting measures boards worldwide have been matching them. Analysts are predicting a move from GAAP to IFRS, so now we inquire ourselves is the shift worth it? Are the values between both planks too similar or too different? And if similar enough, when will this happen (Lynn Cowan 2008)?

The joined States and International standards do comprise dissimilarities but the general principles, structure, and accounting results between the two benchmark boards are similar. The IFRS is constructed nearly to the values of US GAAP. The financial declarations utilised in both the joined States and internationally encompass: balance sheet, earnings declaration, comprehensive earnings for GAAP or declaration of recognized earnings and total cost for IFRS, and declaration of cash flows. Both accounting standards furthermore need that these economic declarations be noted on the accrual basis of accounting. These are the foremost likenesses between GAAP and IFRS. The dissimilarities between the two have not ever been clearly published but in general, the IFRS measures are broader and not as restrictive as the US GAAP. The IFRS favours to depart the implementation of the principles to the individuals or entities that are auditing or preparing the economic statements. But, both still use a code of ethics to ensure that corruption within corporations does not happen even if IFRS more ...