Reporting Standards International Financial
The IFRS Standards are made in order to grow the international shareholding, as the new standards are based on the new financial operations in the market; there is focus on the financial leases and the protection of the investors. IFRS focus on to maintain the highest-quality standards in the international cultural differences thus; there are now IFRS Standards several countries. Moreover, Saudi GAAP to IFRS focuses on the convergence programme but faced the issues because the development the developments of the IFRS Standard largely ignore the extensive research that needs to be conducted in the international cultural differences practices.
The Changing Accounting Environment
The International Financial Reporting Standards, also known as. The standards are based on the IFRS Foundation and are made on the basis of the International Accounting Standards Board known as (IASB). However, in the IFRS Standards, there is focus on the global language, in order to conduct the international business affairs. These IFRS Standards can be comparable across the countries as there are the focuses on the growing of the international shareholding.
Moreover, the IFRS Standards are now dealings in the several countries and progressively replacing accounting standards across the countries, there are new national accounting standards. There are the closer alignments in the new standards that are used internationally because the requirements are changed with the protection of the investors. The companies are struggling in this way as focused to potential toward reducing costs of the different financial statements while focused on the developing the national and international standards.
IFRS Standards are called new accounting standards because followed by the accountants, in which there are the harmonize accounting, these accounting policies are based on developing and applying the new US IASB because there are the series of accounting reforms and the major focus on the revenue recognition for the different level of valuation of financial. In the article, there is the detail discussion of the financial instruments that are changed and assessing the financial instruments so that new rules can provide the benefits in the international business and there could be the convergence of the US and European rules. Countries are focused on the new international standard because the article reveals that are new financial operations and financial leases regarding the IASB and the new IFRS has changed the business world because there are 16 standards for the corporations globally (Agnew & Burgess, 2016).
In the IFRS Standards, there is also the focus on the leasing obligations because the countries are making the accounts more transparent and there are the comparisons of the various types of return on capital. However, there is also a standard for the disclosure of the leasing costs in the country footnotes. Under the new rules, there are new standards for the lease obligations because there is focus on the new rules based on lease accounting. Moreover, the accounting standards are based reporting revenues so that the changes that are made could be known according to the new standard. The first priority of FASB is to improve the potential credit losses and to improve a financial condition, in order to benefit of the investors.
In the IFRS the countries and business are concerned to focus on the financial information of the U.S. capital, in order to maintain the highest-quality standards. The benefits could be there regarding the GAAP because there is clear, relevant and the useful information on the financial statements. There are the expected benefits in the countries, as the comparable global accounting standards have provided the quality to the accounting standards. The IRFS also focused on to reduce the differences in the company’s core mission, investors and other auditor’s etc. The financial reporting system has focused on increasing the public interest and the comparability in the countries worldwide capital markets.
The statement can also be related to the international cultural differences because the IFRS Standards is based on the national accounting standards and not allow the business to do the deep analysis of the country cultural condition. In the countries or culture, there can be the difference but IFRS Standards has made the same principles and obligation for one, however, the issues can be created as the analysis is not fully done. There are the varieties of factors in the IFRS Standards, regarding the country culture that may not be focused example there could be the political differences and the legal or tax system that can differ from the cultural factors and the countries educational factors
Consequently, the economic environment and the cultural environment need to be focused on the joint venture or the business process should be focused, as the detailed study of the culture needs to be focused because based on the explicit and the implicit values. Every culture has the own distinctive achievements and the values that cannot make all the countries to act accordingly what is mention in the IFRS Standards. Moreover, the cultures are based on the embodiments and have in artifacts because there are the attached values while focuses on the products of action.
National And International Standards
Every culture has the cultural relativism and the own cultural values because the accounting standards are focused on the reliability and dependability of the financial information. The IFRS Standards is based on the statutory control that is focused on the ‘Anglo’ culture and have the understanding of the Latin American culture. Moreover, the IFRS Standards impact on the cultural values and provide the countries to think or act on the code laws states because of the socialism or capitalism. IFRS Standards is based on an accounting principles plus regulations. IFRS Standards have the tax law, which questions on that how businesses can be done and how individuals behave in the legal environment or the political environment according to stay focused on obeying the accounting regulation. IFRS Standards or principles are based on the correctness and legality because the size and magnitude can be different, as the cultural aspects or implications of the countries can be different.
For the IFRS Standards there are the different accounting practices in the different countries, but at the international level there can be the challenges in order to understand the global corporations that can also become a reality. However, the IFRS Standards are acceptable in the British and the Australian frameworks but in different countries the concepts can be different, there can be the automatically different members, because it is not possible that if the IFRS Standards have the greatest progress in the countries like Europe then it will be the same in the newly industrialized countries. Moreover, the international accounting issues or problem are taking place for the efforts for the gaining of the international authoritative accounting standards. The IFRS Standards are the standard-setters for the convergence of the GAAP so that all securities regulator focus on the capital markets and reporting the requirements for financials (Bensadon & Praquin, 2016).
Challenges Faced By Middle East Countries
The IFRS Standards faced the issues from the cultural aspects as in the Kingdom of Saudi Arabia the authorities decided to focus on the IFRS by following the accounting standards for the insurance companies and the banks. However, the IFRS Convergence focus to satisfy the needs and to enhance the quality of the Saudi business in the international market, but there were the issues while implementing the foreign direct investment. However, the country focused on the IFRS Standards to improve the transparency and comparability of the business, thus, the IFRS should improve quality but soon it was relaxed that there are the cultural differences and there can be the critical adoptions if the application of IFRS are concerned for the common recurrence.
The Saudi GAAP to IFRS made to focus on the issues that were in the country, as there was the shortage of the skilled accountants as they cannot meet the international standard and the relevant or the applicable authority was able to do business processes in Arabic. There were the Arabic-speaking of the qualified accountants in the country and can waste time by lost in translation. Therefore, the national practices were concerned by the country and there was the professional preparedness on the subject of some standards. Middle East countries can face issues while focus on the convergence programme because to support the sustainable implications of IFRS there is the need of the targeted allocation (Dudley, 2016).
While concluding, it could be said that there is need to focus on the international culture and practices before focus on the IFRS Standards because not all the countries and culture can adopt these practices. However, the careful planning is necessary for the effective in order to support the IFRS implementation and in order to maintain the highest-quality standards in the international cultural differences. IFRS Standard cannot be ignored but there are the international cultural differences. IFRS is based on the new financial operations and the new financial instruments because there are the focuses on the leasing obligations and to make the accounts more transparent in the international authoritative accounting standards.
Financial Assets of the U.S Economy
- Agnew, H., & Burgess, K. (2016, January 21). Accounting reforms poised to lift transparency. Retrieved June 5, 2017, from https://search.proquest.com/docview/1766984037?accountid=11528
- Bensadon, D., & Praquin, N. (2016). IFRS in a Global World: International and Critical Perspectives on Accounting.
- Dudley, D. (2016, April 10). Saudi Arabia Is About To Adopt International Accounting Standards And It Could Cause Problems. Retrieved June 5, 2017, from https://www.forbes.com/sites/dominicdudley/2016/04/10/saudi-arabia-is-about-to-adopt-international-accounting-standards-and-it-could-cause-problems/#6641fbb12686