国际会计学1new.ppt

What is International Accounting? Domestic accounting: an information specialty providing information about a firm to users of that information as a basis for economic decisions. International accounting (defined): same as above except that the firm being reported on is a multinational company with operations and transactions that cross national boundaries or an entity with reporting obligations to non-domestic readers. International harmonization and convergence Harmonization Standards that are compatible – no logical conflicts Means the elimination of differences among existing accounting standards Convergence Means the gradual elimination of differences in accounting standards But might also involve a new accounting treatment not in any current standard Involves cooperative efforts of IASB and national standard-setters Now the preferred term over harmonization A Survey of International Convergence Advantages of international convergence Investor understanding and confidence is improved. Investor decision making is improved. Capital is allocated more efficiently around the world. Financial risk and cost of capital are reduced. Strategic decision making in mergers and acquisition is improved. Criticisms of international standards Solution is too simple for such a complex problem. Strips accounting of its flexibility to adapt to different situations. Challenges national sovereignty. A tactic of large accounting firms to expand their market share. May create standards overload. Reconciliation and mutual recognition Reconciliation Financial statements based on home GAAP, but net income and stockholders’ equity reconciled to another GAAP. This is the SEC requirement for foreign filers. Less costly than preparing complete financial statements based on another GAAP. But a summarized, incomplete picture. Mutual recognition (reciprocity) Jurisdictions accept financial statements based on each other’s GAAP. Does not improve comparability. Can create an unlevel playing