What is the drive for the U.S. officials to move toward International Financial Reporting Standards?
The U.S. Financial Accounting Standards (FAS) General Accepted Accounting Principles (GAAP) and many other countries’ accounting standards for that matter are essentially rule-based and can be quite elaborate and complex. While the U.S. accounting standards are extremely well-researched, they tend to neglect the underlying accounting principals or concepts. The FAS also provides certain opportunities for manipulating accounting arrangements. While the reforms created by the Sarbanes-Oxley Act of 2002 have strengthened FAS, they have put a greater burden on accounting firms and have not created the kind of transparency and conceptual consistency that IFRS provides. Could you highlight some of the key differences between FAS/U.S. GAAP and IFRS and give some specific examples? Research and development costs are capitalized under IFRS but expensed under U.S. FAS. Goodwill is capitalized but subject to an impairment test under FAS, while under IFRS it is capitalized and amortized over its u
