The International Accounting Standards Board

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Introduction Over the past few decades there has been a significant transformation in the global financial structure. These remarkable changes are a result of increasing global competition, changes in business and political climate, increasing technological advancements etc. Globalization in particular has given the corporations and individual borrowers to look beyond the borders for finance and investment opportunities. In order to protect these investors and to maintain the market integrity a financial reporting framework was developed. This framework ensures high quality of financial reporting and true and fair representation of general information for the users of financial statements (SEC, 2000). The framework serves as a guide for…show more content…
At the moment nearly more than 100 countries comply with the IASB standards. Moreover the board is also responsible for the International Financial Reporting standards (Ready ratios, 2010). The process for setting these standards comprises of certain stages such as: setting the agenda, planning, developing the discussion paper and exposure draft and finally setting the standard. After issuing the standards the board members hold meetings to discuss and review whether there are any issues regarding its implementation (Foley,2004). IASB was founded in April 2001, as a replacement for the IASC. It consists of 15 board members from different countries, with a diverse financial reporting background appointed by a board of Trustees (Members of the IASB, 2007). It is the main standard-setter for the countries that use IASs for their financial reporting. USA on the other hand has its own set of standards (GAAP) issued by the Financial Accounting Standards Board. But IASB and FASB since 2002 have been working together focusing on making a converged set of high quality global standards. This will have a huge impact on a number of elements, such as investors, stock markets, accountants,
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