Essay about International Classification of Accounting Systems

Words: 2003
Pages: 9

Classification of Accounting Systems

Critically evaluate to what extent past research into classification of accounting systems has become irrelevant because of international harmonization efforts.

Let us remind that IASC was replaced in 2001 by IASB (International Accounting Standards Board). We are going to start this paper with the different classification researches, taking for example Hofstede and Gray’s studies. Then we will draw the main differences between GAAP (Generally Accepted Accounting Principles) and IFRS (International Financial Reporting Standards). We will also speak about the Americanocentrism problem. To finally dealing with the differences and harmonization. *Two Main Example*s* of Past Studies*:
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SEC even conceded at certain foreign companies the right to observe certain rules IAS as the standard relating to the table of financing (IAS 7), to currencies (IAS 21), companies (IAS 22) and inflation effects (IAS 29). Within the European Union, some harmonization efforts about accounting methods were undertaken. Those however knew the same fate than others and must still produce tangible effects. Moreover, European countries have adopted the principle of mutual recognition of the standards. In spite of the creation of an ad hoc work group in 1990, the accounting harmonization is not a priority anymore, no proposal nor declaration has been made since. It is use consider American standards as the reference. That does not imply their superiority that just reflects economic and political reality. Unless standards IAS are not accepted by the SEC, the companies which follow them do not meet the conditions to be allowed on the American stock exchange places. To be allowed, a German group like Daimler-Benz must satisfy the regulations and specifications of the Stock Exchange where its shares will be exchanged and to match the regulations imposed by the SEC, slightly amended for the foreign transmitters. SEC