Accounting Criteria
Accounting Reporting Criteria Paper
Accounting reporting criteria includes many factors and covers many elements. From Fundamental Financial Accounting Concepts, “accounting is so important that it is often called the language of business. In fact, accounting affects not only individual businesses but also society as a whole” (Edmonds, Edmonds, McNair, Olds, & Schneider, 2006, p. 4). Global business requires added consideration in the way of accounting reporting criteria. With heightened consumer protection becoming increasingly important, regulation of American reporting criteria such as The Sarbanes-Oxley Act (SOX) is common to hear or the Security Exchange Commission’s (SEC) requirement of management submitting a financial statement in an organization’s report. Since so much publicity has been given to U.S. reporting regulations even more difficultly is to identify the regulations in foreign reporting criteria. Many countries do not have the high level of regulations that America has. This makes it extremely important for internationally operating organizations to understand and embrace best practices in financial reporting across borders. The challenges for a U.S. company to deal with a foreign company are regulatory environment, issues with foreign currency, and the differences in general accepted accounting principles.
One example of a collaborative effort to create and unify reporting standards across borders is the International Accounting Standards Board (IASB). The IASB is a regulatory environment and was formed in hopes of overseeing unification in the way of international accounting standards (International Accounting Standards Board, 2008). The IASB is a strong supporter of the International Financial Reporting Standards (IFRS) (International Accounting Standards Board, 2008). The IFRS is a standard best practices guide for financial reporting covering many areas in the content of financial statements and reporting (Wikipedia, 2008). Although its
Accounting reporting criteria includes many factors and covers many elements. From Fundamental Financial Accounting Concepts, “accounting is so important that it is often called the language of business. In fact, accounting affects not only individual businesses but also society as a whole” (Edmonds, Edmonds, McNair, Olds, & Schneider, 2006, p. 4). Global business requires added consideration in the way of accounting reporting criteria. With heightened consumer protection becoming increasingly important, regulation of American reporting criteria such as The Sarbanes-Oxley Act (SOX) is common to hear or the Security Exchange Commission’s (SEC) requirement of management submitting a financial statement in an organization’s report. Since so much publicity has been given to U.S. reporting regulations even more difficultly is to identify the regulations in foreign reporting criteria. Many countries do not have the high level of regulations that America has. This makes it extremely important for internationally operating organizations to understand and embrace best practices in financial reporting across borders. The challenges for a U.S. company to deal with a foreign company are regulatory environment, issues with foreign currency, and the differences in general accepted accounting principles.
One example of a collaborative effort to create and unify reporting standards across borders is the International Accounting Standards Board (IASB). The IASB is a regulatory environment and was formed in hopes of overseeing unification in the way of international accounting standards (International Accounting Standards Board, 2008). The IASB is a strong supporter of the International Financial Reporting Standards (IFRS) (International Accounting Standards Board, 2008). The IFRS is a standard best practices guide for financial reporting covering many areas in the content of financial statements and reporting (Wikipedia, 2008). Although its
References: AICPA (2008). Found in Translation A guide to using foreign financial statements. Retrieved April 13, 2008, from http://www.aicpa.org/pubs/jofa/feb2007/sorensen.htm Edmonds, T., Edmonds, C., McNair, F., Olds, P., Schneider, N. (2006). Fundamental Financial Accounting Concepts. (5th ed.). [University of Phoenix Custom Edition e-Text]. New York: McGraw-Hill Irwin. Retrieved April 7, 2008, from University of Phoenix, rEsource, ACC300 Web site. Kimmel, P., Weygandt, J., & Kieso, D. (2006). Financial Accounting Tools for Business Decision Making. (4th ed.). Hoboken, NJ: John Wiley & Sons, Inc. Retrieved April 7, 2008, from University of Phoenix, rEsource, ACC300 Web site. International Accounting Standards Board. (2008). iasb.org. Retrieved April 11, 2008, from http://www.iasb.org/Home.htmLibby, P., Libby, R., & Phillips, F. (2006). Fundamentals of Financial Accounting. [University of Phoenix Custom Edition e-Text]. New York: McGraw-Hill Irwin. PricewaterhouseCoopers. (2008)Similarities and differences A comparison of International Financial Reporting Standards and US GAAP for investment funds. Retrieved April 12, 2008, from http://www.pwc.com/extweb/pwcpublications.nsf/docid/7FD21F10E3D4300B8525730400674531 Wikipedia. (2008). The Free Encyclopedia. Retrieved April 11, 2008, from http://www.wikipedia.org/