The International Financial Reporting Standards Essay

Does not prescribe a particular format. A liquidity presentation of assets and liabilities is used, instead of a current/ non-current presentation, only when a liquidity presentation provides more relevant and reliable information. Certain minimum items are presented on the face of the balance sheet. Does not prescribe a particular format. A current/noncurrent presentation of assets and liabilities is used unless a liquidity presentation provides more relevant and reliable information. Certain minimum items are presented on the face of the balance sheet.

With reference to the measurement of tangible non-current assets, critically evaluate whether financial statements prepared using IFRS’s provide useful information. Use specific examples from the annual reports of FTSE 100 companies to illustrate your points.

Some of the differences between US GAAP and IFRS are embodied in the standards themselves. They are intentional deviations from US requirements.

Although the International Financial Reporting Standards (IFRS) and Generally Accepted Accounting Principles (GAAP) have a lot of similar guidelines and expectations, they also differ in many ways. The IFRS employs more of a “principles based” accounting standards whereas GAAP utilizes more of a “rules based” approach. Even though there are differences between terminology, revenue recognition, gains and/or losses, and statement presentation, both standards do follow the same conceptual guidelines. With the Sarbanes-Oxley Act (SOX) of 2002, the standards expected of foreign countries are significantly less than those that reside as publically

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

There are subtle differences between the presentation of the IFRS statement of financial position and the US GAAP balance sheet. One primary difference is that IAS 1.66-.67 requires for the statement of cash position to be classified by current or non-current assets and liabilities, while US GAAP has no requirement for the balance sheet to be classified by current or non-current assets and

There are several differences between the International Financial Reporting Standards (IFRS) and the U.S. Generally Accepted Accounting Principles (GAAP). The IFRS is considered more of a "principles based" accounting standard in contrast to U.S. GAAP which is considered more "rules based." By being more "principles based", IFRS, arguably, represents and captures the economics of a transaction better than U.S. GAAP. As a team me collaborated to answer the following seven questions.

International Financial Reporting Standards (IFRS), represent the norms that were introduced by IASB. Being an independent organization that was not operational to earn profits, IASB, also known as, International Accounting Standards Board, incepted IFRS to facilitate public companies around the globe. IFRS presented a framework that served as a guide for these corporations directing them on preparation and disclosure of the financial statements. The International Financial Reporting Standards offered general guidance to the seekers concerning the financial statements. The standards never strived to set industry specific reporting principles or regulations.

One similarity between the U.S. GAAP and IFRS is that fixed assets are estimated at cost originally under both accounting standards; however, after initial recognition, differences occur between the two accounting standards. Under IFRS, after initial recognition, fixed assets are allowed to be altered to fair value. The revolution method is used to do this. This method uses the fair value on the time of assessment, less any accrued devaluation and impairment losses. This method is not used often though due to the high costs of appraisal that is involved. The U.S. GAAP values fixed assets using the cost model. This values fixed assets at historical cost, less any accrued devaluation. Fixed assets include property, plants, and equipment.

Chevis (2014) addresses two of the bigger, but lesser-known, differences between GAAP and IFRS. The two differences addressed, contingencies and depreciation, are the interpretations an accountant has to make on terms not specifically defined by IFRS or GAAP. IFRS is considered to be more “aggressive” for investors while GAAP is considered “conservative” (p. 19). Smith (2012) states IFRS is more principle based, while GAAP is more ruled based. GAAP documents would total over approximately 25,000 pages if printed. IFRS documents would total approximately 2,000 (p. 21).

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.

GAAP and IFRS are significantly different in various ways. GAAP is based on rules and prefers a risk-and-reward model. On the other hand, IFRS is based on standards and prefers a control model. The meaning of this is that GAAP makes decisions as a result of literature and research. IFRS, on the other hand, makes the decisions based on patterns that lead to the formation of facts. Categorization costs are considered as capitalized in IFRS and as expenses in the GAAP. There are also significant differences in the valuation of assets, revenue recognition, assessment of impairment of long-lived assets, correction of errors and financial statement presentations (Epsten and Eva 40-60). However, they are both sets of complete financial statements that require the companies to use the same policies and principles of accounting.

However, it must not be ruled out that the basic financial statements are similar to those of the IFRS standard (Epstein & Jermakowicz, 2010). The FASB conceptual framework bears a marked similarity to the IASB framework which works to effect efficient preparation and presentation of financial statements. It is under this framework that convergence with the IFRS is promised. However, there exists a comprehensive guide in view of financial statements in terms of preparation and presentation in the IFRS standards. There is also a minimum point identified for the identification of all items in the financial statements. In the IFRS, both the FASB and IASB frameworks are essential in the preparation and presentation of financial statements. However in these IFRS standards, the IASB is less detailed. Convergence with the GAAP is also promised.

The US Generally Accepted Accounting Principles (GAAP) is a set of international accounting rules which originated from the United States. US GAAP can be defined as a set of accounting principles, standards and procedures that companies use to compile their financial statements (Elliott & Elliott, 2008). The International Financial Reporting Standards (IFRS) on the other hand are accounting rules originating from the United Kingdom. International Financial Reporting Standards (IFRS) are a set of accounting rules designed with a common global language for business affairs so that financial accounts of companies are understandable and comparable across international boundaries (Devinney, Pedersen & Tihanyi, 2010).

With complete notion and awareness of how each country has their set of rules, “the goal of IFRS is to provide a global framework for how public companies prepare and disclose their financial statements” (Rouse, 2011). This view is meant to provide general guidelines, as well as international comparisons through conventional and edifying means. To bring broader and vivid objectives, IFRS replaced IAS, the older standards, in order to bring a more comprehensive and simplified accounting procedures.