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Will There Be an Accounting Standards

In: Business and Management

Submitted By number123
Words 279
Pages 2
Every minute the world is becoming smaller, with the globalization, technologies, the fast pace of the market, communication is going around fast. Time is money and investors are looking for the fastest and reliable way to invest their money. They are looking beyond their geographic location to invest, having many different reports requirements, require time and money to interpret them, so they tend to trust more on reports that follow the Accounting Standards Board (IASB).
On today’s market company that follows the IASB standards have a competitive advantage in the stock market. The IASB sets the international rules and practice of the financial information, working to minimize the differences between the standards (IFRS) throughout the world. Companies that follow the International Financial Reporting (IFRS) standards have transparent, comparable, relevant, consistent and reliable financial information, on which the investors can count on.
Adopting one type of accounting standards reduces the cost and time the company has to produce them and the time for investors to interpret them. For that reason, companies around the world are adopting the International Financial Reporting standards (IFRS), there are over 100 countries that already adopted the standards.
I believe that in 5 years many more will adopt the IFRS standards, for all the advantages it brings to the financial market. Adopting one type of accounting standards will make it easier for investors, lenders and companies to communicate. It’s like having one universal language.

References

Kimmel, P.D., Weygandt, J.J, & Kieso, D.E. (2009). Accounting: tools for business decision making. John Wiley & Sons, Inc. http://www.sec.gov/rules/concept/34-42430.htm http://www.thecaq.org/publications/GuidetoIFRS.pd

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