http://www.crefige.dauphine.fr/recherche/histo_compta/gulin.pdf
Source: IFRS Foundation Constitution (ias.com, 2010)
The aim behind this assignment is to carry out a critical evolution of the Accounting Practices harmonization process, which took place in past and also focus on the European Union and IASC contribution in this process.
Growth in international trade has been on the increase over the years necessitating several organizations to be involved in the efforts to harmonize accounting practices either regionally or internationally. Among those, leading in this effort were the European Union (EU) and International Accounting Standards Board (IASB) (formerly International Accounting Standards Committee.
European Union
Brief History:
The European Union (EU) is an economic and political union of 27 member countries located in Europe. The EU was established on 1 January 1958 following the Treaty of Rome 1957 (Nobes and Parker, 2010). The objective of Treaty had established rules to encourage free movement of persons, products and services, and capital. This establishment drives the needs of harmonization of accounting and financial reporting.
Thus, the most important objective of EU is to create a common market for the member countries. Uniformed accounting standards are required regionally in all parts of EU to encourage the flow of capital, enhance the protection of the shareholders and other stakeholders, and increase the reliability and comparability of companies’ financial information. The EU shows a contribution to regionally harmonizing accounting practices by established Directives and Regulations, which are the two main instruments to harmonize company law and accounting standards (Nobes and Parker, 2010).
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...e countries considered IASC as a Trojan horse trying to inflict the accounting standard in EU. Some companies in Switzerland chose IASs for their financial statements, and until 1994 several large companies all over Europe used IASs. The last type of countries including United States, Canada, the United Kingdom, Australia, South Africa and Netherlands seems influence the IASC. Furthermore, IASC could be considered as a successful organization as it had a support from IOSCO and EU commission in 2000. Nevertheless, IASC has accomplished their objectives.
The steps of EU and IASB have provided us the standards through which we can easily compare the financial statement. It has also helped in standardization in financial reporting. Harmonization process is still going on and it is an ongoing process. The reporting of group companies may become more comparable in future.
In conclusion, the European Union has “merged” the countries of Europe. It has developed a common currency called the Euro’s, and a Parliament located in Belgium, Luxembourg, and France. Also, ALL of the countries of the Union are affected when one country is affected. This is important because the continent of Europe had become very weak after the wars and they needed to strengthen, and the European Union keeps the countries of Europe strong and economically fit.
The goal of the Codification is to simplify the organization of thousands of authoritative U.S. accounting pronouncements issued by multiple standard-setters. To achieve this goal, the FASB initiated a project to integrate and topically organize all relevant accounting pronouncements issued by the U.S. standard-setters including those of the FASB, the American Institute of Certified Public Accountants (AICPA), and the Emerging Issues Task Force (EITF)
United we stand, divided we fall.After being bombed in various parts, ruined economically, politically, and culturally, and shocked after World War 2, Europe decided to make a union/ supranational organization named the EEC (later known as EU(European Union)) consisting of 28 nations.If you are a citizen in one of these territories, then you have some exclusive rights: you can work, travel, retire, study, etc. in any of these 28 nations, plus all of these countries have the same currency, the euro, so you do not have to switch currencies every time you travel.However, some countries such as Norway did not join, because of the fear of losing their sovereignty or control of own affairs and not give up their unique cultures of cuisine ,
The European Union today is a political and economic entity that controls in a single market located mostly in Europe exploiting Euro as a single currency uniting the vast majority of its members. The market that all European Union members share provides free trade of goods and services as well as a common external tariff. One might argue that the European Union would not perceptible its current influence had it not been for the introduction of the Euro. Speaking of the benefits of the Euro, one can name the elimination of exchange rate problems, creation of a single financial market, providing price stability, low interest rates as well as being a political symbol of unity and commitment to the Union. Today, Euro is the second reserve currency in the entire world - a fact that clearly speaks for itself of its value in the global market.
Over the course of sixty years, the European Union (EU) has evolved to become one of the most economically and politically integrated regions in the world. Compare and contrast the EU with one other major global trading bloc, such as NAFTA or ASEAN, with which you are familiar.
The European Union (EU) is an economic and political union of 28 member states that are located primarily in Europe. The EU has developed a single market through a standardized system of laws that apply in all member states. EU policies aim to ensure the free trade of people, goods, services, and capital, enact legislation in justice and home affairs, and maintain common policies on trade, agriculture, fisheries and regional development.
In the world of international finance there are two major accounting systems; GAAP, which stands for Generally Accepted Accounting Principles, and IFRS, which stands for International Financial Reporting Standards. The United States prefers GAAP while the European market, as well as many other countries, prefers IFRS. By 2015 the Securities Exchange Commission is anticipating a total transfer to IFRS in the United States. Though the differences between GAAP and IFRS are few, they could affect accuracy of financial reporting throughout the world. It is important to understand the differences and similarities between both GAAP and IFRS if one is to globalize ones market (Logue).
Olusegun Wallace, R. 1996. The Development of Accounting Research in the UK. In: Cooke, T. and Nobes, C. eds. 1997. The Development of Accounting in an International Context. London: Routledge, pp. 218-254.
The EU is a union of sovereign European states who share sovereignty based on treaty. The union also possesses competences in policy sectors with exclusive jurisdiction in the area of Economic and Monetary Union while others are shared with Member States (MS), the other powers belong to MS as derived from the conferral of powers art 5(2) TEU, 2(1) TFEU art.3 & 4 TFEU additionally other powers have been offered by the decisions of the European Court for direct effect on citizens
Accounting Theory: Conceptual Issues in a Political and Economic Environment (6th edition ed.). South Western College Pub.
The aim of this paper is to provide the framework of the current professional accounting code of ethics. What are the ethics and how we define them? In this report we try to determine the main ethical principles that will establish the right and
The globalization of business has resulted in the need for compatible accounting standards that can be used internationally for financial reporting. As a result, the International Financial Reporting Standards (IFRS) were developed by the International Accounting Standards Board (IASB) to unify the various financial reporting methods and create a single accounting standard which can be applied to any financial statement worldwide (Byatt). The global standardization of financial reporting will increase the readability and enhance comparability of globally traded companies’ financial statements, without the need of conversion or translation. There are a few main differences between the International Financial Reporting Standards (IFRS) and the U.S. Generally Accepted Accounting Principles (U.S GAAP). The increasing recognition and acceptance of the International Financial Reporting Standards by accounting professionals in the United States, will affect the way in which the U.S will record financial statements in the future.
The main objective of the IASC was the development of International Accounting Standards, in an effort to reduce the differences in accounting practices across countries. Harmonization is the name given to the process of reducing differences in financial reporting practices and increasing comparability of financial statements in various countries. As such the intent of the IASC was to create a set of accounting rules that would be relevant and consistent to all countries ...
There are several key components of the European history that have led to the creation of the individual nations within the EU and the larger supranational Institution we call the European Union. As Curtis and Linser (2004) “The European Union is the most important development in European history since World War Two” (Curtis & Linser, 2004, p.4). And I tend to agree that this story line is the most important since it was the starting’s to one of the largest supranational organizations that shaped modern Europe and continues to shape it today. To start the European Union could not have been created without the nations that are part of this supranational organization. Many of the nations that make up the EU have been either long-term super powers, France, United Kingdom or Germany, but also areas plagued with conflict. The conflict is however the more important of the two. The conflict between Germany and the rest of Europe in WW2 was the sparks that created...
The success of a company is very dependent upon its financial accounting. In accounting there are numerous Regulatory bodies that govern the accounting world. These companies are extremely important to a company because they set the standards when it comes to the language and decision making of a company. These regulatory bodies can be structured as agencies, associations, commissions, and boards. Without companies like the Security and Exchange Commission (SEC), The Financial Accounting Standards Board (FASB), the Governmental Accounting Standards Board (GASB), Internal Accounting Standards Board (IASB), Internal Revenue Service (IRS), and other regulatory bodies a company could not make well informed decisions. In this paper the author will look at only four of them.