Issues in Financial Reporting

Question 1 a) There argon many benefits to adopting a reproducible set of story standards that define which types of financial proceedings and events are to be recognised and how they are to be divulge in financial statements. Firstly, as businesses become increasingly global, those multi-national companies that machinate operations overseas will not need to score a separate set of financial statements for each of the antithetic countries that they conduct operations in. Further, if they are unable to generate the shootd finance within a single country, through the standardisation of be standards worldwide, they are able to have their securities listed on the stock exchanges of some(prenominal) several(predicate) countries, and as a result expand their bottom of ceiling funding resources without needing to spend excessive amounts on additional account costs. This, will in turn, affix the efficiency of capital flows crossways nations and reduce the cost of capit al, thereby encouraging to a great extent investors to pursue investing in foreign markets and securities.

Secondly, where companies in different countries prepare their financial statements using the same accounting system rules and assumptions, it is easier and little expensive for investors and other users of financial statements to more accurately and reliably compare alternative investments of local and foreign companies and kick downstairs realize where they should invest their funds. This is particularly important, as there has been an increase in the number of investors investing in companies from different countries and so, such investors! require better quality and easily comparable training to lead them with a reasonable and more transparent solid ground for accord and evaluating foreign investments for the purpose of making efficient and impressive international investment decisions. Thirdly, international accounting standards and assumptions provide companies with great flexibility, in that they follow a...If you want to get a plentiful essay, bon ton it on our website: BestEssayCheap.com

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