The International Accounting Standards Boards

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A (a)On 1 January 2005,all the stock exchange listed companies in Europe adopted the International Financial Reporting Standards (IFRS) written by the international Accounting Standards Boards. According to IASB, the setting body of IFRS, their primary objective is to develop a set of high quality, transparent ,understandable, global accepted financial standards in the public interest (IFRS 2015) . Furthermore, the statement made by European Commission also explained the benefits including the elimination of barriers to international trades, the increasing of transparency and comparability of company accounts, the improvement of comprehensive strength and the rapid promotion of economic growth (Commission 2002). Based on the public…show more content…
(b) The prior objective of mandatory adoption of IFRS is to facilitate cross-border comparability, increase reporting transparency and reduce information asymmetry and thereby enhance the efficiency and competitiveness of capital market (Horton, Serafeim & Serafeim 2013). However, applying IFRS in different countries with different enforcement mechanism can hardly achieve the accounting harmonization, because companies are still willing to adopt their former national regulations that reflect their requirements ,and therefore misled the users of financial report who do not pay attention to these systematic differences by an uniformity on the surface (Deegan 2014). In the given material, there has been various problems when EU endorse the international accounting standards. Not only did the international accounting significantly reflect the Anglo-Saxon accounting practice rather than continental European practice (Dewing & Russell 2008) but also, political, business differences might continue to impose substantial obstacles in the process of accounting convergence and standardisation. Until then, whether the financial information become more reliable and comparable after the adoption of IFRS is still
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