Report on the effect of harmonization in accounting standard in the international scene
Nowadays, international capital market has promoted a lot in the efficiency and productivity of every national investment. An increased in cross border financing will affect the relationship and financing problem of one country to another. In order to achieve both these objective, a harmonization of formulating the accounting regulation must be promoted by adopting International accounting standard (IAS). However, certain obstacle or benefits may be earns from variety of organization including multinational company, international investor and stakeholder, government and national standard setting bodies and regional economic groups such as ECOWAS.
The International Investor (TII) is a Kuwaiti shareholding company that provided distributors of financial services with expertise and knowledge to access to international stock and bond market. Hence, the harmonization of national accounting standard has ability to make a useful and meaningful comparison of investment portfolio in different countries. The converging of national accounting standard of General Accepted Accounting Principles (GAAP) in every country to International Financial Reporting Standards (IFRS) will be established and maintained by the International Accounting Standards Board. This is a practice of global harmonization to increase the consolidation of financial statements in multinational company such as Intel and Dell. In another word, better management control in the internal communication of financial information. Most importantly, it will made the company save a lot of time and costing in appraisal of foreign enterprise, auditing, reporting, managing and also migration or transfer of skillful staff across the national border. Thus, the harmonization of accounting standard will show out the transparency of a company to gain trust from shareholder and gain reliable from investor.
In the European Union,...