What are the effects of international accounting standards on accounting practices of developing nations?
Adoption of international accounting standards is extremely costly. Developing counties usually use accounting standards that are most beneficial to them (based on who they trade with to ease accounting for transactions) or just another country’s GAAP that works for the developing country. Ex. Mexico very closely resembles U.S. GAAP because of NAFTA and the quality of U.S. GAAP. Should IFRS be implemented in developed counties, developing counties might be forced to adopt them as well in order to maintain trade relations. This could be extremely costly for smaller developing counties. Does the accounting system appear to facilitate one specialty from financial, auditing, or cost managerial or tax accounting over the others? The elegance of Accounting is that it is a purveyor of information, organized into systems, and exploited for a particular purpose. That is because Accounting is vague. Interestingly, information from accounting can be split into to methods: 1. Valuation 2. Evaluati
