Pricing

Electronic Presentations in Microsoft® PowerPoint®

Prepared by

James Myers, C.A. University of Toronto

© 2010 McGraw-Hill Ryerson Limited

Chapter 1, Slide 1

© 2010 McGraw-Hill Ryerson Limited

Chapter 1

A Survey of International Accounting

Chapter 1, Slide 2

© 2010 McGraw-Hill Ryerson Limited

Learning objectives

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To identify factors that can influence a country’s accounting standards To describe areas where Canada’s accounting standards differ from those used in other countries To identify the role the IASB intends to play in the establishment of uniform worldwide accounting standards To identify the direction that the CICA intends to follow for public and private companies To identify the direction that the FASB intends to follow for public companies

Chapter 1, Slide 3

© 2010 McGraw-Hill Ryerson Limited

GAAP variances and standardization

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Past GAAP variations between countries caused financial measurement and presentation differences. GAAP differences have included incomesmoothing techniques, variances in asset measurement and revaluations, and the differing nature and extent of disclosures. Globalization of commerce and capital has increased the number of multinational companies and therefore the need to standardize financial reporting.

Chapter 1, Slide 4

© 2010 McGraw-Hill Ryerson Limited

LO 1

Comparability and cost-benefit constraint

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The comparability objective of financial reporting is impaired by differing standards. For example, to improve comparability to U.S. public companies, the U.S. Securities and Exchange Commission (SEC) has required Canadian companies that trade on U.S. exchanges to reconcile their net income from Canadian GAAP to U.S. GAAP. The cost of preparing financial statements under multiple GAAP standards is significant and hinders the international flow of capital.

LO 1

Chapter 1, Slide 5

© 2010 McGraw-Hill Ryerson Limited

Factors...