University of Phoenix- ACC440
September 5, 2005
International Accounting Standards Board
"The International Accounting Standards Board (IASB) was preceded by the Board of the International Accounting Standards Committee (IASC), which operated from 1973 until 2001." http://www.lasb.org/about/history.asp . The International Accounting Standards Board (IASB) was founded on April 1, 2001. Its role is to encourage companies nationwide, that are doing business with the United States, to adopt a set of financial statements that are reliable, accurate and compatible with the rest of the world.
We live in a rapidly changing and expanding market. World markets have become closely entwined. Foreigners have an interest in American food, music, television, just as Americans have a desire to drive and purchase foreign cars, clothing and other items. As the world economy continues to become globalized, many investment and/or credit decisions must be made based on analysis and interpretation of financial statements; however, there is a lack of uniformity in accounting standards between the different countries. This lack of uniformity has occurred as a result of different legal systems throughout the different countries, as well as different governmental requirements and economic environments. The International Accounting Standards Board was established to formulate and publish international accounting standards that would be used and accepted worldwide. The subsequent paragraphs will identify the progress that has been made along with the Board's stance on ethics.
Many of the established accounting standards are driven by tax or other regulatory needs and are not oriented to the needs of investors. There has been an increase in cross-border access to foreign and capital markets that has fueled the international expansion of many businesses. With this expansion,...