International Accounting

Paper Summary:

This paper explains that international trade is complicated by the various currencies which are used in the world's marketplace, because, whenever an entity buys from a foreign supplier or sells goods to a foreign customer, the parties involved must agree on the currency to be used to settle the transaction. The author points out that the biggest problem is the inability to "interpret" financial statements from foreign countries properly because the standards in each country vary and they cannot be merely equated with domestic standards and regulations. The paper relates that, to attempt to maintain a semblance of order and understanding, there has been a constant effort, especially since the formation of the International Accounting Standards Committee (IASC) in 1973, to establish a harmonious "language" and set of standards, which would cover all the nations involved in the economies of the globe.

Table of Contents
Overview
The Needs and Opportunities for International Harmonization
G-22
IOSCO
Conclusions

From the Paper:

"Given the differences and the need to develop a harmonious system of accounting standards, why is it not happening, at a time when joint ventures and buy-outs by the wealthier nations of industries in the hard-hit lands (Thailand and Mailaysia) This question can be asked again and again, and different versions may appear in this essay, but no one has an adequate answer. It is not asking a total revolutionary upheaval of financial or accounting practices. Still, many national accounting associations want to be the one making some sort of "sacrifice", It is a source of national pride, rather than a globalizing opportunity. However, there are groups, made up of international financial and accounting leaders, who want to make at least some progress."

More papers on International Accounting:

• Term Paper # 135977 : "International Accounting Standards Board"
• Essay # 70589 : "International Accounting Standards"
• Term Paper # 140345 : "Australia and International Accounting Standards"
• Analytical Essay # 8220 : "SEC Concept Release on International Accounting Standards"

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