Comparison of Aspe for Ifrs

Therefore, until definitive guidance on accounting for emission schemes is issued, an entity applying IFRS has the option of either: Applying the principles of IFRIC 3; or developing its own accounting policy based on the hierarchy of authoritative guidance in IAS 8 Accounting policies, Changes in Accounting Estimates and Errors.

Moreover, ASC 250-10-45-17 presents that “A change in accounting estimate shall be accounted for in the period of change if the change affects that period only or in the period of change and future periods if the change affects both. A change in accounting estimate shall not be accounted for by restating or retrospectively adjusting amounts

The IFRS is basically a set of accounting rules which are issued by the IASB based in London, UK. These accounting standards have originated from its predecessor IASC defining the term IAS, which occurred in the 70’s. it was only after 2000’s that the IASB took a strong hold under the label IFRS claiming to be a lot more independent even though pertaining to its predecessor, efficiently staffed and better funded. Caffermen and zeff (2006) discuss about the gradual spread of accounting has made a considerable progress over time, and with the adoption of IFRS worldwide, accounting procedures could be smoothened.

Explanation: Both IFRS and GAAP have different requirements about the measurement and process for revaluating fixed assets to fair value.

The statement of changes in equity determines the changes in the equity accounts during the reporting period. A set of financial statements both IFRS and US GAAP include the statement of changes in equity. The statement of changes in equity states the shareholder changes and non-controlling interest changes separately. Most companies prepare a statement; however, US GAAP allows the changes in equity to be presented in either a statement or the notes to the financial statements.

IFRS has fewer requirements on revenue recognition, but follows the same basic principle of economic significance. Revenue can be recorded when t is probable that any future economic benefit associated with the item of revenue

Industry experts considered IAS 18 Revenue to be inadequate for complex accounting transaction applications and ASC605 contained various industry-specific main and sub requirements that did not achieve the goal of consistent revenue recognition outcomes. (McConnell, 2014). The IASB and FASB boards have issued 2 separate standards for revenue recognition and the contents exhibit several differences (See Exhibit 1: Appendix). To understand the usefulness of the IFRS15 standard a regulatory framework, the study of the differences between IFRS and US GAAP as well as the motivation behind the decisions made in standard setting is crucial. Key difference which could potentially affect the usefulness outcome is the prohibition of unrealized impairment loss reversals under ASU606. The updated revenue recognition standard by definition describes that a contract asset or contract liability arises in the event that either party to said contract performs (Ernst & Young, 2014) .Subsequent to initial recognition, impairment tests should be performed in accordance to IFRS9 or IAS39 on all contract assets and impairment losses needs to be presented in profit and loss. In effect, allowing for reversal of impairment losses would increase the value of contract assets up to the amount not greater than the

The International Financial Reporting Standards (IFRS) is the accounting framework used by the European Union, Japan, Canada, and other world economic leaders. The IFRS is based on the tenets of understandability, reliability, and comparability. It is based off the International Accounting Standards (IAS) and had the opportunity to be built from accounting ideas and principles used across the world. In recent years it also has had the chance to look at the United States Generally Accepted Accounting Principles (GAAP) and modify the rules to enhance clarity and consistency, intentionally setting itself apart from U.S.

The current effects of IFRS effect organizations that hold foreign pension plans for employees. IFRS methodology is similar to US GAAP with deferred recognition of actuarial gains or losses, except where past service costs are recognized immediately, instead of being amortized over the service period or life expectancy of workers. Under IFRS, actuarial gains and losses can be recognized in equity, but not under US GAAP. US GAAP has a minimum liability reported in the statement of financial position, but IFRS does not. IFRS limits recognition of pension assets, but US GAAP has no limitation. Curtailment gains and losses are recognized when announced under IFRS and is calculated different from US GAAP. IFRS expenses termination benefits when the employer is committed to pay and US GAAP expenses them when employees accept and they can be reasonably estimated. (Epstein)

There have been proposals that have been working on with regard to the replacement of GAAP (Generally Accepted Accounting Principles) with IFRS (International Financial Reporting Standards) as used in the accounting and financial reporting aspects. Such convergence requires that the functions of the GAAP standards be added to the IFRS. The International Accounting Standards Board (IASB) developed the IFRS which is a less-detailed financial reporting system.

The IFRS are made to be a common global language used for accounting and business in order for an organisations monetary situation is easily understood and interpretable between different countries (Eng, Sun & Vichitsarawong, 2014). For example, financial reporting in Saudi Arabia of an organisation may look more favourable than an Australian company, because of the different measures used by

On February 24, the SEC unanimously agreed to publish a statement of continued support for a single set of high-quality global accounting standards. The SEC acknowledged that IFRS is best positioned to be the global standard. Even without a set conversion timeline from the SEC, IFRS has been affecting

Before the IFRS 15 was issued, revenue recognition requirements under the US GAAP and the IFRS were different and required improvement. They conflicted with each other and resulted in different accounting for transactions that were similar. IFRS’s previous revenue recognition standards were difficult to understand and apply as well.

Including Fiat,more and more huge cooperations are adopting IFRS accounting policies since 2000,not only because it makes more transparency in statements,but it tenses or looses the strict that enhance the efficiency and accuracy of accounting.

Under IFRS (IAS-1) expenses recognized in profit and loss are classified on the basis of nature or functional basis, which company thinks can give best explanation, but under IND AS expenses can be classified on the basis of function, it can be classified on the basis of nature