International Fashion Industry Accounting Practices Comparison Essay by serendipity

This paper explains that, examining the accounting measures and practices of each of these companies, both the American and European companies have a bottom-line concept of accounting that is represented by the basic accounting principle of 'assets=liabilities + equity'. The author points out that, in the United States, laws require a financial statement unless a company is traded on the stock exchange; in Europe, companies, which have only debt securities listed on the EU regulated markets, and which have securities listed on the non-EU markets, are required to prepare consolidated accounts according to internationally recognized standards. The paper demonstrates the difference in international reporting practices, which make comparison almost impossible; with globalization, these differing practices must be standardized.