Accounting Standards Boards Paper
One of the most debated topics in today’s world is the phenomena of economic globalization and accounting internationalization. Unprecedented changes in the global market economies, have given this phenomena a new impetus and a change in the accounting profession that is inevitable. This change encircles a project on the convergence toward international accounting standards.
The functioning of the global economy depends basically on the accounting standards. The purpose of accounting standards is to help regulate financial reporting. For example, in the U.S. the Financial Accounting Standards Board (FASB) establishes and regulates the accounting rules, the Securities and Exchange Commission (SEC) conforms the capital markets, and Sarbanex-Oxley was written to protect investors from the possibility of corporate fraud (Oddo, 2007, ¶1).
The FASB mission focuses in two areas: first, establishing and improving the standards of financial accounting; the second area includes reporting of financial statements. The objective is to educate and guide users of financial statements, including auditors, stockholders and issuers. The FASB has been working in developing a broad system of accounting concepts and standards for financial reporting (Schroeder, Clark, Cathey, 2005, p. 37).
The International Accounting Standards Board (IASB), headquartered in London, is an independent, privately-funded accounting standard-setter, founded on April 1, 2001, and is the successor of the International Accounting Standards Committee (IASC). The IASB considered the authority or head on international accounting standards. The mission of the IASB includes the development of the International Financial Reporting Standards (IFRSs), on a single set of high quality and understandable general purpose financial reporting, in accordance with the public interest. IASB is supported by an external advisor council (SAC) and an interpretations committee...