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时间:2016-04-12 16:03来源:www.ukassignment.org 作者:留学生作业 点击:

Standard Costing And Variance Analysis






考虑公众的利益,国际会计准则委员会应该设定生产高质量标准,准确、清晰和可比信息的财务报表可以帮助参与者在各种资本化市场做出正确的决定。另一方面,推广和监督义务的标准严格遵循会计准则委员会。此外,IASB总是考虑中小企业的需求。(US Security and Exchange Commission, 2000)




At the summer of 2007, a financial crisis was spread from United States to all over the world. In less than a year, the financial statements of companies and banks went wrong with assets which were declined dramatically. One of the reasons for this decline was the macroeconomic uncertainty, however, another significant reason was considered that the weakness of using different accounting standards. During the following four years, in order to re-establish confidence for the market and financial institutions, national authorities have taken exceptional steps to adjust the impact on the real world. (iasplus.com, 2011) Also, G20 leaders have raise the opinion that should set the single high-quality global accounting standard to support unstrained and competitive markets.


In order to achieve setting the single high quality standard, accounting standard-setters, the IASB and the FASB, have been taken steps to consummate the IFRSs, such as highlight the importance of stakeholder engagement, updating their adjustments to G-20 before the completion date of June 2011, and doing more analysis with terms related to the risk management. (Sarno, Young, & LLP, 2010)

With considering the benefits of publics, IASB should set standards which could produce the high quality, accurate, clear and comparable information in the financial statements which could help the participants to make the right decision in the variety capitalized market. On the other hand, generalizing and supervising the standard to be followed strictly are the obligation of IASB as well. Moreover, IASB always consider the needs of medium and small enterprise. (US Security and Exchange Commission, 2000)

Adopting global accounting standards is in the best interest of investors, issuers, and regulators. (Deve, 2005) Some experts said, "the cross-jurisdiction and cross-industry transparency and comparability desired by investors and other users of financial statements will be increased in a globally consistent accounting framework." (pwc.com, 2009) The financial crisis was lead to the financial institution to consider the reasons for the lost. It realizes that there are quite lots of problems no matter during the daily transactions or even the long term financial statements. With the unclear information and analysis, the losses appear.

Now let us discuss needs for setting global accounting standard.

Actually, the recent stock market is based on the globalization. In different countries, although the currencies they used for business are various, the way they do the transaction and contract is similar. In fact, the worldwide business and capital market have the nature of interdependent which is more apparent nowadays. (pwc.com, 2009)To some extent, the convergence of the accounting standard increases the comparability of the financial statements. (Accounting today staff, 2010) For example, if an UK Company and an US Company want to make a transaction and are doing the negotiation. The first information these two companies got about each other was the financial reports, however, the UK Company follows the IFRSs and the US Company follows the US GAAP, therefore the comparability is quite low and it also need more labor power to transfer the different reporting and then to do the compared. If do not consider the own countries` standard benefits and the factors of environment, only seeing from this view, using different accounting standards will lead a waste to the companies.

In the published papers of the national authority, "using a universal accounting language is a natural and necessary response to the globalization of business, finance and investments. It will reduce the unnecessary complexity that exists with multiple reporting languages. The standard helps to improve investors' ability to assess investment options as well; and broaden the accessibility of cross-border capital thereby increasing the competitiveness of the US capital markets; moreover, it generates process and cost efficiencies for multinational US issuers over time as IFRS gains further acceptance for statutory and tax reporting purposes around the world." (pwc.com, 2009)

IFRS recently acquires the priority among the accounting frameworks and adapting to worldwide capital market. It provides a high-quality, comprehensive and robust set of accounting standards. If counties like US intend to work with other countries in developing one common accounting and reporting language, the only choice they can make is IFRS. In fact, setting accounting standard is to adjust and improve some terms of the IFRS. With the universal accounting standard, there will be less confusion and all the information is clear for making the choice. (ifrs.com, 2010)

Although the credit crunch happened, the priority action of financial institution is restoring the economy and the confidence in the capital market. Transfer IFRS to another new accounting standard will takes five to seven years, this period is quite long and flexible enough to address the economic concerns. (Guebert, 2010) With using the new accounting standard, the investors, shareholders or even the accountants will have new views about the financial situation and it will take new blood to the capital market.

Establishing a new global accounting standards is satisfied the specific needs for some countries such as US. Risks here are bad for the variety forms of capitalism which is related to the long term development of the world. (tm.mbs.ac.uk, 2010) In order to minimize the uncertainty, the national authority should publish a strict announcement to let the new standards run, otheriwse, nobody wants the changings. (pwc.com, 2009) In order to give the most benefits to the investors and other participants of economic, the accounting standard should be free from bias and undue political influence. The independent funding and accountability of the IASB to setting the accounting standard is quite important across variable geographies, market and industries. (ERNST&YOUNG, 2009)

IASB have established a Monitoring group to ensure the roles and the responsibility of IFRS to be met. Moreover, the mandatory conversion date should be set. The experts explained it as, "Because it can provide the certainty and clarity necessary for stakeholders to move forward and address the regulatory, legislative, tax, educational, licensing and conversion challenges". (pwc.com, 2009)

The US uses the US GAAP more effectively when doing the businesses with outside participants. The using of the universal accounting standards will benefit these outside participants because of no protection for the US participants in this accounting standard. The significant participations in each of these organizations are responsible to accelerate the community of the financial community.

However, these needs for the set of global accounting standards do not fit in the purpose.

Setting global accounting standards takes quite a long time. During this long period, the circumstance of economy has quite a lot changes which could be seen from example of the convergence of the IFRS and US GAAP. The IASB and FASB should take time to investigate the different terms and work out the solutions. Only with the clear principle the standards could have a good function, otherwise, the old way of doing financial reporting need no changes. Currently, both IFRS and US GAAP have good quality and function to accomplish the global transaction, although sometime it a little bit complex, during development of transition, IFRS will continue to be as the normal standard. (Illiano, 2008)

The IASB and FASB have already begun to converge IFRS and US GAAP, and the process has proven as "long, difficult, costly, and not wholly successful". Since from 2002, FASB and IASB have tried their best to adjust the terms of these two standards. Nine years later, many of the different terms have been proved and adjust to get the new way such as the area about consolidation, taxation and foreign currency. Some experts state that "convergence will create a long-term, steady stream of changing standards that will result in an IFRS-influenced version of US GAAP, rather than a single set of fully converged standards". (pwc.com, 2009)

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