The International Financial Reporting Standards Essay

The International Financial Reporting Standards Essay

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The International Financial Reporting Standards, or IFRS, are a major set of standards for accounting used outside of the United States. Multiple bodies, made up of accountants from multiple major economic markets, are involved in developing and publishing IFRS standards. Since the initial release of IFRSs every major continent has at least one jurisdiction using IFRS. In order to have one global and competitive market a unified set of financial reporting standards needs to be used. The International Financial Reporting Standards, influenced and accepted by accountants from around the world, are a promising start to a global set of accounting standards and the growth of a global market.
The IFRS is affected by multiple authoritative bodies, before and after the actual standard is written. There are two bodies that are concerned with the technical standard setting itself. The first is the International Accounting Standards Board, or IASB, which was established in 2001 in London, England. The IASB is composed of fourteen experts appointed by the Trustees of the IFRS foundation. These experts are chosen based on their recent and practical knowledge in standard setting, their knowledge of accounting education, or due to their knowledge with financial statements. The experts are geographically diverse, and the current IASB includes members from Europe, North America, Asia, and one member from South America and Africa. The goal of the IASB is to develop and publish IFRS, as well as approve interpretations created by the Interpretations Committee (“Members of the IASB”). The Interpretations Committee is the second body involved in the writing of IFRS, and is also composed of fourteen members appointed by the Trustees. Expert...

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...f IFRS adoption was less authoritative guidance than US GAAP. This may cause increased issues in certain aspects currently defined by GAAP, but the lack of authoritative sources may also be less confusing for auditors and preparers to navigate. In addition, companies may become more transparent due to the principle-based nature of IFRS because there are less authoritative loopholes and regulations to manipulate the financial statements (Weigel, Tyler).
The IASB and other boards involved in developing IFRS are constantly accessing the needs of a global set of standards. While there are concerns directed toward IFRS adoption, the widespread use of IFRS implies a significant advantage of adoption. It is possible that the IFRS will be the set of standards to unite economic markets from differing regions and allow growth into a unified global market for the future.

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