International Financial Reporting Standards.

INTERNATIONAL FINANCIAL REPORTING STANDARDS.

DISCUSS THE ADVANTAGES AND DISADVANTAGES AND CHALLENGES TO IMPLEMENT SUCH SPECIFIC STANDARDS. POSSIBLE PROMPTING QUESTIONS: DO YOU BELIEVE THE FASB SHOULD CONTINUE EFFORTS WITH IASB TO INTEGRATE US GAAP AND IFRS? WHO WOULD BENEFIT AND WHO WOULD BARE THE COST? SHOULD SEC ALLOW US COMPANIES TO USE IFRS IN THEIR SEC FILINGS? What is the status of the road map and convergence efforts to date?

The decision whether to develop a single universal standard for financial reporting has been the major discussion among persons in the Security Exchange Commissions and other agencies in the accounting sector. The SEC’s main objective is to use International Financial Reporting Standards as a basis for U.S. financial reporting. This change has caused many debates as most persons are not ready to give up their old way of financial reporting. This paper seeks to examine the advantages and disadvantages of the implementation of IFRS as well as the benefits and drawbacks.

The Businessdictionary.com (2009), describes International Financial Reporting Standards as “Guidelines and rules set by International Accounting Standards Board (IASB) that companies and organization can follow when compiling financial statements.” It further explains that the creation of these standards enhance the efficiency in comparing financial statement in the global economy. The International Financial Reporting Standards were formerly called the International Accounting Standards.

The International Accounting Standard Committee was formed in 1973 to assist the need for standard for smaller nations in developing their own standards. The main objective of the IACS was to develop a single set of high quality, understandable and enforceable global standards to help business make economic decisions (Spiceland, 2008). The IASC issued forty one International Standards which were endorsed by the IASB. The IASB revised many of these standards and in the process...