The Pros And Cons Of International Financial Reporting Standards

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Over the last several years, the controversy of the United States adopting International Financial Reporting Standards (IFRS) has been a significant issue for many businesses who are pro Generally Accepted Accounting Principles (GAAP). Although U.S GAAP has been the common accounting principles for many countries, specifically the US, now countries are adopting IFRS. In addition, there are many organizations such as European Union (EU) and International Accounting Standards Committee (IASC), who want domestic and international businesses to have one set of standards to be implemented. On November 14, 2008, the Securities and Exchange Commission proposed a rule named “Roadmap for United States Issuers”. This proposed rule could potentially force businesses that are publicly traded in the United States to begin implementing IFRS for the years after December 2014. Moreover, transitioning from U.S. GAAP to IFRS can effect financial reporting, operations within a company and can cost companies money.
Researchable Questions:
1. If the United States adopts IFRS, What aspects of a company’s operations will be affected?
Adopting IFRS would not only affect …show more content…

We know that there are major differences between the two standards and some key issues that can affect a company. The question is what will the SEC do? Will transitioning to IFRS become enforced for American companies? If, so when and how will this occur? The purpose of writing this research proposal was to analyze if the transition from Generally Accepted Accounting Principles (GAAP) to International Financial Reporting Standards (IFRS) in the United States only has an effect on financial reporting. We learned that is has an effect on other business operations as well. Moreover, reporting under IFRS has its pros and cons but it is ultimately up to the Securities and Exchange Committee to fully implement what standard they want to U.S businesses to

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