What Is The Difference Between AAOIFRS And IFRS

A rule making body issues authorative shari’a auditing standards for all Islamic banks and other Islamic businesses and it will be the most effective way to eliminate problems within the Islamic economy. The most effort to develop a body of consistent standards for shari’a audits has been undertaken by

In addition, it is very important to owners, investors and creditors by presenting the financial position, cash flows and financial performance. AASB develops and maintain high quality financial reporting standards for all sectors of the Australian economy and contribute to the development of global financial reporting standards to be recognised. Moreover, this can identify technical issues (Brian, 2003). When AASB identify a technical issues, it will develop a project proposal. A project proposal may include an assessment of the potential benefits of undertaking the project and the costs of not undertaking it and then the project proposal will be reviewed and made a decision by the AASB. This has close relationship with FRC and IASB (Flikkers, 2008).

The statement of financial position and the balance sheet is statement that reviews the assets, liabilities, and equities that a business is holding at a particular moment in time. These elements: assets, liabilities, and equities; allows the reader of the financial statement to be able to identify what the company owns, owes, and has invested into the company.

In 2001, The International Accounting Standards Board (IASB) was established to develop the International Financial Reporting Standard (IFRS). ). The first IFRS was issued in 2003 and European Union (EU) members committed for requesting all listing company to apply the IFRS in their jurisdictions and will effective on year 2005 (Brussels, 2000).

Due to the controversy economies have had towards which method to use for accounting, there has been a compromise to converge the two most commonly used methods – GAAP and IFRS. However, these two methods are still very different. The convergence project has yet to be completed; in the meantime, more and more countries are running towards the IFRS since it is more reliable and relevant. The main difference between these two methods is the US GAAP is rule-based while the IFRS is principle-based; this means that the US GAAP makes its decisions based on research and literature, while the IFRS bases its decisions on patterns that result in facts. A deeper look into the differences between these two methodologies shows

Globalization, from a business aspect, is the process by which businesses or other organizations develop international influence or start operating on an international scale. Countries have long been involved in business; however, there is a concern regarding the lack of consistency in standards that businesses are to follow. The rapid advancement of technology and conducting business from country to country has become common practice, creating the need to unify as many of the financial rules and regulations as possible. The purpose of this paper is to examine how the two types of financial reporting systems began, discuss combining the two systems or

For those in the business world, particularly in the accounting field, a major issue has surfaced in recent years relating to the differences between Generally Accepted Accounting Principles (GAAP) and the International Financial Reporting Standards (IFRS). Currently, the majority of countries in the world follow International Financial Reporting Standards guidelines; however, the United States still uses GAAP. This topic has been a main focus because there is a plan for convergence between the two frameworks in the near future. The United States accounting system will undergo drastic changes when this occurs, but

There is a lot going on in the US accounting world at this time. Businesses are trying to gear up for the changes that are happening to their books. IFRS and US GAAP are in the process of convergence so businesses can be on the same page when conducting business globally. There are more similarities than differences between IFRS and US GAAP when you compare the presentation of their financial statements (US GAAP versus, 2015). This paper will take a look at the similarities and differences of the two frameworks, and how various accounting practices affect the presentation of financial statements for IFRS and US GAAP.

•IFRS 9 'Financial Instruments '- addresses the classification, measurement and recognition of financial assets and financial liabilities;

A company following IND AS has to follow the Single Statement Approach for presenting financial statement under which all items of Income and Expenditure are required to present in a single statement of Comprehensive Income, where as a company following IFRS has the option either to follow Single Statement Approach or Two Statements Approach. If the company opts to follow Two Statements Approach, it has to prepare Two Statements- one displaying components of profit and loss and second displaying components of other Comprehensive Income.

For the Mudaraba investment found, AAOIFI standards require presenting the funds in a separate item between liabilities and equity in the statement of financial position. On the contrary, compliant with IFRS, the fund will be recorded as liability.

Being important to the discipline of accounting, the objectives of IFRS and IAS are to give guidance on the presentation of financial statements. IFRS as

Revenue focus. Any lending model can only succeed with the injection of adequate capital. The focusing of stagnant funds on revenue effectively removes funds that could be used for lending. The challenge will be to have the lender forego a profit yielding investment. Islamic scholars have identified this predicament as a negative attribute associated with interest; it prevents the creation of interest-free loans as the lender expects to realize a gain (Al-Fawzan, 2005). The

There are still many differences in accounting treatment between International financial reporting standards (IFRS) and the U.S Generally Accepted Accounting Principles (GAAP). While IFRS are widely used by many countries around the world, FASB of the U.S still working on the intention of either adopt the IFRS or converge towards it. Until the convergence actually happens, there are still many critics about the accounting treatment at the same subject under U.S GAAP and IFRS. Example of this is the argument about whether U.S GAAP should allow upward revaluation of non-financial asset of IFRS which was described in details on the article “Upward Revaluation of Non-financial” in the CPA journal November 2012 by David Sardone and Tom Tyson.

The Accounting and Auditing Organization for Islamic Financial Institutions established on Safar 1, 1410 Hijri (February 26, 1990) at Algiers and registered in Bahrain on Ramadan 11, 1411 Hijri (March 27, 1991) has so far (April, 2004) set the following Financial Accounting Standards, Auditing Standards, Governance Standards & Code of Ethics for Accountants & Auditors of Islamic Financial Institutions: