The Association of Southeast Asian Nations (ASEAN) was established on 8 August 1967 with initially 5 member countries which are Indonesia, Malaysia, the Philippines, Singapore and Thailand. Later Brunei Darussalam, Vietnam, Laos, Myanmar, and Cambodia joined the association, forming 10 member countries in total. The aims and purposes of the ASEAN include accelerating economic, social and cultural development to enhance competitive advantage in the region and promoting regional peace, stability and collaboration among its member countries (Association of South East Asian Nations, 2015b). In 2003, the member countries agreed to establish the ASEAN Economic Community (AEC) as part of the regional integration efforts. The AEC is scheduled to …show more content…
This would enables investors and creditors to evaluate financial information consistently over time and among different companies. Thus, the ASEAN countries would also need to move toward a single set of global accounting and financial reporting standards in the future to align with other nations.
Although the accounting standards used in each ASEAN member countries are independently governed by the regulator of each respective member countries, the ASEAN Federation of Accountants (AFA) is the key regional accounting organisation for the national associations of accounting professionals of its member countries (ASEAN Federation of Accountants, 2015a). One of the objectives of the AFA is to advance the status of accounting profession in the region (ASEAN Federation of Accountants, 2015b). The AFA supports the IFRS as an appropriate accounting practice to be used in all ASEAN member countries (Ahmed & Jahangir, 2006). Table 1 illustrates the current status toward the adoption of the IFRS among the ASEAN 10 member countries. As of 2015, seven countries, namely Brunei, Cambodia, Laos, Malaysia, the Philippines, Singapore, and Myanmar have already adopted IFRS and the IFRS for SMEs either as issued by the IASB or with some degree of modification. The other three countries, namely, Indonesia, Thailand, and Vietnam are taking into account the IFRS in developing their local standards.
The complexities of legal structures and regulatory environment as well as the
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We now want to look into the International Accounting Standards Board and framework for the preparation and presentation of financial statements. The conceptual frameworks are split into five categories and are in the following order: the objective of financial statements; underlying assumptions; the qualitative characteristics that determine the usefulness of information in financial statements; the definition, recognition, and measurement of the elements from which financial statements are constructed; and the concepts of capital and capital maintenance (Ankarath 11). The standards under IFRS are beginning to become much more popular across the world for several different reasons. The International Financial Reporting Standards are currently being used by at the very least 100 countries and “[was] expected that by 2011, more than 150 countries [would] have adopted them” (Ankarath 1). We happen to find this important because it seems that a lot of countries are starting to adopt IFRS to report their financial statements. One of the reasons why many countries made the switch over to IFRS is because “the decision of the U.S. SEC to allow foreign private issuers to list their securities on U.S.
For nearly half a century, a movement has been underway to establish a high-quality, comprehensive set of international accounting standards, with the goal of facilitating international trade and investment. In the global capital market, differences in the rules of accounting for the purposes of recognition, measurement, and reporting of financial results have impaired the smooth transfer of information across borders. Given that it accounts for nearly a third of the global market, there is considerable pressure for the United States to conform to the International Financial Reporting Standards (IFRS), as promulgated by the International Accounting Standards Board (IASB). While moving to a single set of accounting standards could create
The globalization of markets over the past 50 years has led to the demand for increasingly comparable financial statements across countries. In response to this demand, the International Accounting Standards Board (IASB) was formed with the purpose of developing a set of high quality global accounting standards. Although a majority of developed markets have adopted the international standards, the United States has not. One reason for the delay in adoption is that many of the standards are very similar. However, there are also several key differences between the two. Presently, the United States Financial Accounting Standards Board (FASB) and the IASB have
In 1973, the private sector International Accounting Standards Board (IASB) was formed. The IASB is a natural extension of a global market that has been evolving over the last three decades. The IASB formulates and publishes accounting standards to be observed when presenting financial statements and promote their global acceptance. As an overarching mission, the IASB works to improve and harmonize accounting standards, regulations, and procedures as it relates to financial statements. IASB standards provide a reference model and set of examples for financial reporting in developing countries. The IASB has no authority with the Financial Accounting Standards Board (FASB) or the Securities and
International financial reporting standards (IFRS) are the attempt of the International Accounting Standards Board (IASB) to globally harmonize accounting standards and financial reports (Doupnik & Perera, 2014). Such standards are principles developed by the IFRS foundation and the IASB whose goal are to implement international accounting standards (IAS) which promote transparency, accountability, and efficiency of financial reporting to ensure organizations draft financial reports that are comparable internationally (IFRS Foundation, 2015). In an effort to facilitate the adoption of IFRS, accounting professional bodies worldwide such as the Institute of Chartered Accountants of Scotland (ICAS) have implemented initiatives to guide and train their members in understanding the new standards adopted within their espective country.
Before 2001, none of the major economies in the world requires the use of International Financial Reporting Standards (IFRS). However, since IFRS was adopted and required by the European Union (EU), IFRS is currently the most widely shared set of accounting standards with its application required or permitted by approximately 120 countries as indicated by the IFRS Resources (2015). IFRS, perceived as “a single set of high-quality, understandable and enforceable accounting standards” (IASB, 2007, p.4), shows its prevalence all around the world. Nevertheless, there are still some opponents against such harmonization. “The likelihood that any U.S. company will be forced to switch from using today’s version of U.S. Generally Accepted Accounting Principles (GAAP) to using today’s version of IFRS is absolutely zero”(2010), said the specialist in corporate financial reporting, Bruce Pounder, doubting the possibility of eliminating differences between IFRS and U.S. GAAP, not to mention sharing a single set of accounting standards in all countries.
There are many different types of accounting standards and principles in the business world. It would be difficult for financial markets to operate and compare reports with these different various standards. Therefore, the International Accounting Stands Board have developed a new way of reporting financial information. The International Financial Reporting Standards (IFRS) foundation and the International Accounting Standards Board (IASB) were established in 2001 in order to develop a set of high quality and acceptable financial accounting standards. ("IFRS - Organisation history", 2016). The aim of this report is to firstly summarise the significant changes in the Australian Accounting Standards Board (AASB 15) and how they address perceived deficiencies in the current standards. Then, it will highlight the future implications of adopting the AASB 15 for Australian companies.
Accounting standards are authoritative statements intended to narrow the areas of differences and varieties in accounting practice. It is important regulatory devices of accounting. It serves as a contract template among management, creditors and investors. As companies have become more globalized, comparing financial statements has become more difficult because of different accounting rules (maxwellsci). Over 100 countries have adopted International Financial Reporting Standards (IFRS) in that matter. The accounting system in U.S. has been based on Generally Accepted Accounting Principles (GAAP) since the 1930s. In theory, switching to IFRS would make it easier to compare U.S. business to others around the world, reducing companies’ cost of capital. However, not everything changes at once (Nick). The International Accounting Standards Board (IASB) and US Financial Accounting Standards Board (FASB) have set a long-term strategic priority to achieve convergence of IFRS and U.S. GAAP into a common set of high quality global accounting standards. The convergence is to avoid conflict and confusion, promote simplicity, consistency and transparency (IFRS.org).
The objective of this paper is to deliberate the concerns regarding implementing International Financial Reporting Standards in United States. There is no scope that IFRS standards would be fully implemented in the United States. The main reasons are two regulatory bodies Financial Accounting Standards Board (FASB) and International Accounting Standards Board (IASB) are unable to integrate on the concept of convergence. Due to current economic conditions, FASB and IASB came together to reduce the differences between U.S. GAAP (Generally Accepted Accounting Principles) and IFRS (International Financial Reporting Standards). Furthermore, Security and Exchange Commission has
Due to the global integration of business and finance throughout the world, approximately 113 countries have adopted or are working on convergence with IFRS. This paper is a look at the history and an examination of where IFRS stands internationally and with the United States. For several decades the industrialized world has been working toward an international set of accounting standards. Since IFRS has become the de facto international accounting language, it is logical that it will be accepted as that standard in the near future.
This report will address the main features of the International Accounting Standards Board’s (IASB) Conceptual Framework (CF) by explaining the purpose and intent of these standards together with the structure of the framework. The important features of these standards will be highlighted, analysing of the significance of these and ultimately whether the CF has impacted on accounting practice.
For many years, countries have created their own accounting standards which was either rules based, principle based, tax oriented, business based, etc which as a result, made them all different. There eventually came a need for harmonization since the world was undergoing globalization. As we approached the late 1990’s, we saw two predominant standards which was GAAP and IFRS. It is now clear that the world is moving to a more
The chief objective of this report is to describe the advantages and disadvantages of International Financial Reporting Standards (IFRS) conceptual framework in general. The report also directs attention towards Australia’s step towards harmonization of the accounting standards and as well as on international financial reporting system. However, the prime focus of the report is on the adoption, implementation and the impact of IFRS framework in a developing country, Bangladesh. The very report advocates that the adoption and implementation of IFRS framework has both positive and negative sides. In spite of financial and time constraints in adopting IFRS every nation is keen towards being a member of IFRS accounting standards. It is because countries want to trade globally and for such purpose they need investors. In order to attract and retain such potential and existing investors firms/organization need to follow certain accounting standards in generating the financial reports that are accepted worldwide. Finally, the report concludes that the worldwide harmonization of accounting standards has many future benefits along with some short term obstacles, however, it is difficult to apply the same accounting standards worldwide as each and every country differs from another in respect of its enforcement mechanism.
The association of Southeast Asian nations (ASEAN) is a regional grouping comprising ten Southeast Asian states, which promotes intergovernmental cooperation and facilitates economic integration among its members (Fry, 2008). The organization was formed on 8th August 1967, preceding an organization that had been created in 1961 known as Association of Southeast Asia. It was formed when some foreign ministers signed the ASEAN declaration, which is normally recognized as the Bangkok declaration.
Association of Southeast Asian Nation (ASEAN), a 10-member organization established in August 1967, moves toward a deeper integration through creating a unified community in political, economic, and socio-cultural aspects of the region. It is a region of great diversity but most countries have achieved rapid economic development for the most of the past 25 years. Its diplomacy and cooperation are characterized by caution, pragmatism, and consensus-based decision making – the “ASEAN Way” (Ponciano Intal, et al., 2014). Taking steps to achieve their goal and embracing its motto, “One Vision. One Identity. One Community.” the organization established the ASEAN Economic Cooperation (AEC) in 2015. This aims to promote an all-inclusive cooperation across the region, gearing towards making South East Asia a globally competitive single market and production base characterized by: free flow of goods, services, investments, skills, and capitals. Moreover, it intends to form a region of equitable economic development integrated into the global economy (The ASEAN Secretariat, 200)