Ifrs

United States’ Transition to International Financial Reporting Standards

Markets have become increasingly more global over the years. Businesses have long since stopped competing against other businesses in the same community or state. Now, national competition is almost a thing of the past, and it is now giving way to a global marketplace full of competition from countries all over the globe. Factories and business entities can be spread worldwide. One example is the auto industry. For a while, the "Big Three" had most market share in the U.S., but slowly, other companies from other countries began to gain market share. Another example is customer service. When someone calls a customer service number, that phone call may be answered anywhere in the world.

Some acronyms to know

IASC- International Accounting Standards Committee

IASB- International Accounting Standards Board

IFRS- International Financial Reporting Standards

FASB- Financial Accounting Standards Board

SEC- Securities and Exchange Commission

Some acronyms to know

IASC- International Accounting Standards Committee

IASB- International Accounting Standards Board

IFRS- International Financial Reporting Standards

FASB- Financial Accounting Standards Board

SEC- Securities and Exchange Commission

As industries now have competitors all over the world, comparing individual businesses is becoming harder. It may be difficult to tell who has the best sales, or which would provide better return on an investment in the company. That can cause headaches for investors or lending agencies as they try to figure out which companies are the most risky or are the best investment. It can also make it more difficult for companies to benchmark against its competitors. Currency exchange rates play a role in this. Another factor could be how they report financial information. As recent cases have shown, there are lots of ways to shift items, like expenses or certain liabilities, around on a financial report to...