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Financial And Accounting Challenges Faced By Businesses From Emerging Markets In Meeting International Accounting Standards. Companies In Azerbaijan.
Finance & Accounting
Pages 9 (2259 words)
In the year 2005 it was observed that companies in many countries started adopting International Financial Reporting Standard (IFRS). Countries like South Africa, Australia, and New Zealand etc were among the first to adopt IFRS.
Countries like South Africa, Australia, and New Zealand etc were among the first to adopt IFRS. The countries of The European Union (EU) are now required to follow IFRS. Emerging economies like China, Azerbaijan etc. adopted IFRS. China had given January 2007 as deadline for implementing IFRS. Gradually all the countries in the world will adopt the financial reporting standard. USA and Canada are also getting prepared for the adoption (Barry and Jermakowicz, 2010, pp.1-2). Many businesses which are not required to adopt IFRS and are not publicly held are still implementing IFRS in their accounting. This is because a common standard of accounting followed all over the world will facilitate free flow of capital. If an investor of UAS, for example, wants to invest in a company in China he will need to examine the financial statement of the company. If the company prepares its financial statement using same methods as that is followed in the investor’s country it will be easier for the investor to understand the financial position of the company. Therefore using an international standard like IFRS for preparing financial statements will win investors confidence (Barry and Jermakowicz, 2010, pp. 2). However adoption of IFRS is not totally hassle free. Companies going through the transition from old methods to IFRS specified methods face many challenges. ...
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