A.
Harmonization and Standardization Understanding Differences in Accounting Standards Applicable.
Harmonization" is a
process to improve
the compatibility (suitability)
accounting practices by setting limits on
how large these practices may vary. Harmonization of standards will be free of conflicts of logic and
can improve the comparability
(comparability) of financial information originating from various countries.
Efforts to harmonize accounting standards have been started long before the
establishment of Accounting Standards Committee (International
Accounting Standards Committee – IASC) in 1973. Harmonization efforts increased during the
1990s, the international accounting harmonization is now one of the important
issues faced by
the makers of accounting standards,
capital market regulators,
stock exchanges and those who prepare or use financial statements.
Sometimes people use the term harmonization and standardization as if both have the same meaning. However, contrary to the harmonization, standardization generally means the
determination of a group of rigid
rules and narrow and may even be the application of a single standard
or rule in any
situation. Standardization does
not accommodate the differences
between countries, and therefore more difficult to
be implemented internationally. Harmonization is much more
flexible and open;
not use one size
fits all approach, but to accommodate some of the differences and have experienced great
progress internationally in
recent years.
Comparability financial information is a concept that is more apparent than harmonization. Financial information generated from the system
of accounting, disclosure and audit different
or comparable if
it has a similarity in the way
in which users can compare the financial statements (at least in some aspects)
without the need to familiarize
themselves with more than one system.
Harmonization includes harmonization of accounting (1) accounting standards
(which relates to the measurement
and disclosure), (2) disclosures made by public
companies related to securities offerings and
listing on the stock exchange,
and (3) auditing standards.
B.
Explaining the Pros and Cons of International
Harmonization of Accounting Standards.
International Harmonization Profit
Proponents say that the harmonization of
international harmonization (even
standardization) has many advantages. Sir Bryan
Carsberg, former Secretary
General of the IASC, wrote the following on the month
of September 2000:
Cautious approach
to analyze the desire for international harmonization shows that the costs and
benefits vary from case to case. Those who use English as their mother may feel
fortunate that English be the language that is widely used around the world.
However, although it can be done, we can not obtain an agreement that the
British or other common language should be used to replace the 6800 or more
languages currently used in the world. We recognize that language is the
vehicle of an irreplaceable cultural and distinct culture that removal would
cause huge losses in the field of literature and other cultural expressions.
How to harmonize taxation and
social security system? Businesses
will have considerable
benefits in planning, systems
and training costs,
and so of harmonization.
But this case
shows us that the
harmonization of other losses.
Taxation and social
security system has a strong
influence on economic efficiency. Different systems have
different effects. The ability to compare how
the different approaches in
different countries led countries
capable of increasing their own system. Countries
competing and competition forced them to adopt
an efficient system through the operation of such market power. Approval
of the tax system will be like the
establishment of a cartel and would eliminate the
benefit to be gained from inter-state competition.
A recent article also supports
the existence of a "global
GAAP" harmonized. Some of the benefits mentioned include:
·
a global
capital market and
investment capital can move across the world
without any fuss. High-quality financial reporting standards that are used consistently throughout the world will improve the
efficiency of capital allocation.
·
Investors can make better
investment decisions; portfolio
will be more diverse and less financial
risk.
·
Companies can improve strategic
decision-making process in the field of mergers and
acquisitions.
·
The best ideas arising from the
standards-making activity can be deployed in
developing high-quality global
standard.
Criticism of the
International Standards
Internationalization of accounting standards is also drawn
criticism. In early 1971 (before
the establishment of IASC), some argue that the
determination of international standards
is a very simple solution for
complex problems. At the international standard
of doubt can be flexible to overcome differences in background, tradition,
and national economic
environment, some people argue
that this will be a challenge that is
politically unacceptable to
national sovereignty.
Some other observers
argue that the international
accounting standard-setting is essentially a tactic of the accounting firm that
provides accounting services to
expand its market internationally. Multinational firm is said to be critical in the implementation of
international standards on national environmental standards which are to be
seen much more different and complex. Also, because the international financial
institutions and international markets precision to use international
standards, only the large international accounting firms are able to meet this
demand.
Furthermore, it feared that the adoption of
international standards will
lead to "standards overload." Companies have to respond to pressure the
composition of national, social,
political, and economic growing and increasingly prepared
to meet the additional international regulations are complicated and
costly. Related argument
is the concern of
national politics often influence the accounting standards and that
influence international politics will again lead
to the inevitable compromise
of accounting standards.
However, some argue that currently there are international capital
markets are well
developed which has grown rapidly in recent years without a Global GAAP.
One commentator argues:
Harmonization of international accounting principles is
unlikely to materialize. Too
many national groups
have different interests
to defend embedded
their own standards
and practices that have evolved from a historical perspective and is very different. There
is no single dominant party
which is strong
in the harmonization proposal. No competent
authorities have the ability to
define Global GAAP
adoption .... I
would argue that Global GAAP
difficult to achieve because of institutional barriers in the standard setting
process and therefore there is
no real need to encourage
the growth of international capital
markets are healthy.
C.
Understanding the Meaning of Reconciliation and Recognition of Joint (reciprocal) of the Accounting
Standards Difference.
Some proponents argue that international harmonization will help
to solve the problems associated with cross-border
financial report of
the State.
Two other approaches are proposed as a possible solution is used to solve problems
related to the content of cross-border
financial statements: (1) reconciliation, and (2) mutual recognition (which is also referred to as "reciprocity"
/ reciprocity). Through
reconciliation, a foreign firm can prepare
financial statements using accounting
standards the State of origin, but must provide a
reconciliation between the accounting measures (such as net income and
shareholders' equity) in the State of origin and in
countries where financial
statements are reported. For
example, the U.S. Capital Market
Commission (SEC) allows
foreign companies registered to use the principles of accounting other than U.S.
GAAP basis financial
statements are presented. However, the SEC also
requires disclosure of the
reconciliation.
Mutual recognition occurs when the regulator outside
the country of origin to receive
the financial statements of foreign
companies which are based on the principles of country of origin.
For example, the London Stock Exchange
accept the financial report based on U.S. GAAP
for the reporting made by foreign companies. Reciprocity does not increase the cross-country comparisons of financial statements and can lead to "unequal
playing field" which allows foreign companies to apply less stringent standards than those applied to
domestic firms.
Evaluation
National differences in the underlying factors that lead to differences in accounting, disclosure and
audit practices increasingly
narrow as the
capital and product markets become increasingly
international. Many companies
have adopted IFRS voluntarily. These companies see the economic benefits
of adopting the accounting and disclosure standards
are internationally credible in the eyes. Expand
the company's voluntary disclosure to be made
in accordance with IFRS to answer the
demand from institutional
investors and other
users of financial statements. The success of harmonization efforts by the international organization
can demonstrate that
harmonization occurs as a natural response to economic forces.
Application of International Standards
International accounting standards
are used as a result
of (a) an
international treaty or a politician, (b) voluntary
compliance (or being
pushed in a professional), or
(c) a decision by
the national accounting standards-making body. Implementation of
EU directives relating
to the accounting originated
from an international political agreement. The
more the number of companies decided
that the best interests of companies to use
IFRS, although not required. Many states today have allowed
the company to base their financial statements in IFRS and some countries require.
Efforts of other international standards in accounting is essentially voluntary. Those standards will be accepted or
not depends on
the people who use the accounting standards. Current
international standards and national standards
are not the same, do not be a problem, but when these
two different standards, national standards should
be the first reference
(to have the advantage). For example, multinational companies may use international
standards as well as receive
and use the national
standards. When companies megadopsi more than one
set of accounting standards, a result which
is that they often have to be borne must
publish a set of reports for each set of accounting standards which
they adopt. This is done in the context of convergence of national accounting standards
and international accounting standards.
D.
Identifying Organizations to Promote Harmonization and has a
important role in
Setting International Accounting
Standards.
Six organizations have become
a major player in the determination of
the international accounting standards and in
promoting international harmonization
of accounting:
1.
International Accounting Standards Board (IASB)
International Accounting Standards Board (IASB), formerly the
IASC, the standards-making
body of an independent private sector was established in 1973 by professional accounting
organizations in nine
countries and restructured
in 2001. Before the restructuring, the IASC issued 41 International Accounting Standards
(IAS) and a
Framework for the Preparation and Presentation of Financial
Statements. IASB objectives
are:
a. To develop in
the public interest, a set of global accounting standards are of high quality,
understandable and can be applied which requires high quality information,
transparent, and comparable in the financial statements and other financial
reporting to help participants in capital markets and other users in making
economic decisions.
b. To encourage
the use and application of these standards are strict.
c. To bring the
convergence of national accounting standards and International Accounting
Standards and International Financial Reporting Standards in the direction of
high-quality solutions.
The core standards
of IASC and IOSCO Agreement
IASB (and formerly IASC) has
sought to develop accounting standards that
will be received by the securities
regulatory bodies around the world.
As part of that effort, the IASC adopted a work
plan to produce a core set of comprehensive high-quality standards. In July 1995
the Technical Committee of IOSCO his approval to
the plan as follows:
Council (IASC) has developed a work
plan approved by the Technical
Committee which, if successfully
completed will result
in IAS comprising a comprehensive set of
core standards. The
completion of this comprehensive
standard that is acceptable to the Technical Committee (IOSCO) allows approval of
the Technical Committee for the use of IAS
in the collection of capital and the needs of cross-border listing of shares across global markets. IOSCO
approved IAS 7,
Statement of Cash Flows, and has given an indication to the IASC that 14
of the International Accounting Standards that exist now do not require
additional improvements, provided that other standards
are successfully completed.
Structure
of the IASB's New
IASB Council established a Working Group on Strategies (Strategy Working
Party, SWP), which considers how should the
strategy and structure of the
IASC after completing the program of work of this
standard. In September
1988, SWP approved a discussion paper "Shaping
IASC for the Future" to encourage and
focus discussion. In November 1999 the
IASC Board unanimously approved a resolution supporting the proposed new structure
that essentially are: (1) The IASC will be
established as an independent
organization, (2) the organization will
consist of two
main bodies, and
the Trusteeship Council, and the Interpretation Committee
fixed (now known as International Financial Reporting Interpretation Committee) and the standards Advisory
Council, and (3) the
trust will appoint board members, conduct surveillance and gather the
necessary funds, while the board
has sole responsibility
for setting accounting
standards.
Restructured IASB met for the first time in
April 2001. IASB, after reorganization, will
include the following entities.
1.
Guardian Agency. IASB has 19
trustee: six from North America, six from Europe, four from the Asia / Pacific,
and three from other regions (depending on the determination of the overall
geographical balance). Trustee agency lifted a board member, International
Financial Reporting Interpretation Committee and Standards Advisory Council.
The Trust is responsible for collecting funds and to monitor and megevaluasi
priorities and IASB operations.
2.
Council IASB. Council to
establish and improve standards of financial accounting and reporting efforts. Council comprises
14 members, appointed
by the Mayor to
give "the best available combination of technical
expertise and background
of international business experience and relevant
market conditions." All board members are salaried
employees of the IASB: 12 people working full time and two people can work
part time. Seven of the members have full time responsibility for developing
relationships with national standards making body. (The goal is to build
partnerships with national bodies because everything works together to achieve
convergence of accounting standards around the world). The members are appointed
for a period of five years, and can be renewed only once.
3.
Standards
Advisory Council. Standards Advisory Board, appointed by the Trustees,
consisting of "thirty or more members, which has a geographical and
professional backgrounds are different, who are appointed to three-year
renewable." Standards Advisory Board
generally meets three times each year. Responsibilities
is to provide views on the council "organizations
and individuals within the council on major standard-setting projects" and
to provide "other counsel" to the board or a trust.
4.
International
Financial Reporting Interpretation Committee (IFRIC). IFRIC
comprises 12 members appointed by the trust. IFRIC interpret "the
application of International Accounting Standards and International Financial
Reporting Standards in the context of the IASB Framework," issued a draft
interpretation and evaluate the comments above and obtain board approval for
the final interpretation.
IASB to follow the process of setting accounting
standards. For each standard to be established, the council published a "Draft Statement of Principles" or other
discussion document containing a range of possible provisions in these standards
as well as arguments in favor or against one another. Furthermore, the Board issued
an "Exposure Draft" to obtain
public comment, and then examine the
arguments presented during the
process of providing comments before settling on the final form of the standard. An
Exposure Draft and
final standards will
be issued if eight of the members of
the board gives approval to do so.
Recognition and support for
the IASB
International
Financial Reporting Standards has now been widely accepted
around the world. For example, the standards (1) is
used by many countries as a
basic national accounting
terms, (2) is used as an international benchmark
in most major industrial
countries and emerging
market countries to make his own standards, (3) accepted by many stock
exchanges and regulatory bodies that allow
foreign or domestic
companies to submit
financial statements prepared under
IFRS, and (4) is
recognized by the European Commission and other supranational
bodies. In 1995, the
European Commission approved the IFRS.
Rather than amend the existing directive, the
EC determined that the EU should be in line with
efforts to IASC / IASB and IOSCO that led to the international harmonization of accounting standards more widely.
Almost all EU
companies whose shares are listed
on leading stock
exchanges have to use IFRS
in preparing financial statements
no later than 2005.
U.S. Capital
Market Commission's response
to the IFRS
The
SEC did
not accept IFRS as the basis of the submitted
financial statements by listed companies shares
on U.S. stock
exchanges. However, the SEC
is in the increasing pressure to make
the U.S. capital markets
more accessible to non-US makers report,
SEC has expressed support for the purpose of the IASB to develop
accounting standards used in the financial statements used in cross-border offerings.
However, the SEC also
stated that three conditions
must be met by the company before the SEC can
accept IASB standards.
By declaring these three conditions (in the following list), the
SEC has shown great flexibility in terms of how far to accept the
use of IFRS by foreign issuers.
1. Standards must include the core
accounting provisions that determine a comprehensive basis of accounting and generally accepted.
2. Standards should be high quality,
resulting in comparability and
transparency, and provide full
disclosure.
3. Standards must be interpreted and applied
strictly.
Comparison between IFRS and Accounting Principles
Content Other Comprehensive
Various analyzes have been compared with
the IFRS accounting principles other content.
There are several motivations for this
analysis. The regulators and standard makers
in most countries want to know the level of concordance between the State of origin and IFRS principles,
the extent to which the principles
in the State of origin should be revised to be
in accordance with IFRS or the extent to
which IFRS is acceptable to use the country of
origin as a reference standard.
The
U.S. Financial
Accounting Standards Board (FASB)
has initiated a major
project that compares the IAS
(time) with the
U.S. standard in 1995, and
published a detailed
report in 1996 and
1999. Project Comparison between IASC and
U.S. GAAP FASB
is part of a plan
for international activities, which include
the promotion of international
comparability of accounting standards. The main objective of this study is to
provide information in assessing the acceptability of IAS for the registration
of securities in the United
States.
2.
EUROPEAN UNION (EUROPEAN UNION-EU)
Treaty of Rome established the EU in 1957, with the
aim to harmonize the legal and economic systems of States members. Per
month of May 2004, EU comprises 25 members
(Austria, Belgium, Cyprus, Czech Republic,
Denmark, Estonia, Finland, France, Germany,
Greece, Hungary, Ireland,
Italy, Latvia, Lithuania,
Luxembourg, Malta, Netherlands, Poland, Portugal, Slovakia,
Slovenia, Spain, Sweden,
and England. In
contrast to the IASB has no power to require
the implementation of accounting
standards, the European Commission
(EC, the EU
ruling body) has
full authority over
the accounting directive to all member countries.
One goal is to achieve the integration
of EU financial markets of Europe. To
achieve this goal, the EC has introduced a directive and take a huge initiative to achieve
a single market for:
·
Acquisition of capital within the
EU;
·
Creating a common legal framework
for securities and derivatives markets are
integrated;
·
Achieve a single set of accounting standards for companies whose shares are listed.
Of
the few
that exist, many people who consider that the Directive Fourth, Seventh, and
Eighth is the
most historic and most important substantive.
Directive Fourth,
Seventh and Eighth
Fourth EU directive, issued in the year 1978, a single set of accounting rules of the most extensive and
comprehensive in the
basic framework of the EU. Both
public and private companies that exceed a
certain minimum size criteria should be obeyed.
Provisions of the Fourth Directive applies to the
accounts of individual companies
and include the
rules of the form of financial
statements, disclosure provisions,
and valuation rules.
Fourth directive also
requires financial statements to
be audited. The aim is to ensure that European
companies to disclose information that is comparable and equivalent
in its financial statements.
Seventh directive, issued in 1983, addresses issues consolidated financial statements. At that time,
the consolidated financial statements are
the exception and not a liability. Consolidation is normal in Ireland, the
Netherlands, and Britain, while Germany requires
consolidation (just) above the existing subsidiaries
in Germany. However, consolidation is rare in other parts of Europe. Seventh
Directives require the consolidation of business
groups in the amount above
a certain size, determines the disclosure
in the notes and the directors report, and
it does require an
audit. Because of this consolidation
as a relatively new legal provisions, Member States are given broad leeway
and a lot of options to enter the Seventh
Directives into national
law firms of each
country.
Eighth Directive, issued in 1984, discussed
various aspects of professional
qualifications that are authorized to
carry out the audit as required by law (mandatory audit). Basically, this
directive determines the minimum qualifications of auditors. Eighth directive
is not related to mutual recognition
of auditors in
an EU country
other EU countries.
This directive also
does not discuss the
establishment of professional freedom
among EU countries.
Training must be
completed under the supervision of an
auditor who has
been appointed. There should be
independence, but the Eighth Directive gives
discretionary powers to the EU countries
to determine the
conditions of independence.
Is Harmonization
efforts have so
far?
Fourth and Seventh Directives have
dramastis influence over financial reporting across the EU, namely bringing
the accounting in all members of the EU member
States to stage a good uniformity and
relatively adequate. Directive is to
harmonize the presentation of profit
and loss account (income statement) and balance
sheet and increase the minimum additional information
in the record, specifically the influence of tax rules on disclosure of the
reported results. This directive
to accelerate the development of accounting in many
EU countries and
also affect the accounting
in the State of non-EU neighbors.
The
success of harmonization efforts at the EU-20 to a bad end is still in question. Some have questioned whether
the accounting harmonization
directive complies with the intent at the time the directive was issued.
Karel van Hulle, Head of Accounting
and Audit Unit
of the European Commission, explains
that there are some
difficulties as follows:
It must be admitted that the appeal had been
achieved through the
harmonization process is far from
perfect. First of all, the main
accounting directives contain a minimum
of rules. This directive not discuss a number of accounting issues that
are important. Second, the provision
of the Directive is not always interpreted in
the same manner by the Member
States. A number of problems
associated with interpretation of
the Directive has been discussed by the Contracts Committee
for Accounting Directives.
Other questions that remain unanswered. Very difficult to reach
agreement on these questions because
the text of the Directive is to leave some
space interpretation of the Member States are
not prepared to compromise
on this interpretation.
Common words of some
provisions in the Accounting Directives are
important reasons why the European Commission has not brought some of
these questions before the European
Court for final
decision.
3. International Organization of the Capital Market Commission
(IOSCO)
International
Organization of the Capital Market Commission (The International Organization of Securities
Commissions-IOSCO) consists of a number of regulatory bodies of
capital markets in over 100 countries. According
to the IOSCO budget bookkeeping:
Capital market authorities decided to work together in ensuring better
market regulation, both at
domestic and international, to maintain a fair marketplace,
efficient and healthy:
·
To exchange information with
each other based on their experience to encourage
the development of the domestic
market.
·
Uniting efforts to create
standards and effective surveillance of international
securities transactions.
·
Provide assistance together to
ensure market integrity through the application of strict standards
and effective enforcement against offenses.
IOSCO has worked extensively in international disclosure
and accounting standards
to facilitate the ability of firms
to raise capital efficiently through the global securities
markets. In 1998, IOSCO published a set
of non-financial disclosure
standards, which in turn allows the
company to use
the same one prospectus
to offer shares or
listed on one of the world's major capital markets.
An IOSCO technical committee to focus on multinational
disclosure and accounting.
Its main purpose is to facilitate a process that can be used by
publishers world-class shares
to raise capital in
the most effective and efficient at all
that there is a demand
for capital market investors.
The Committee is working with the
IASB, among others, by providing input to the
IASB projects. A
working group completed the study in 1998 to
recommend that facilitate multinational
equity offerings. The report recommends
"that the regulator can be encouraged, where consistent with its
legal mandate and objectives of
investor protection, to facilitate the use
of a single disclosure document, whether through
harmonization of standards, mutual
or otherwise."
4.
International Federation of Accountants (IFAC)
IFAC is a world-class organization that has 159 member
organizations in 118 countries,
representing more than 2.5 million accountants.
Founded in 1977, IFAC's
mission is "to support the development of the accountancy profession with harmonized standards so
that the accountant Dapa provide consistently high quality services in the public interest."
IFAC Council, which meets every 2.5
years to have a representative
from each IFAC
member organizations. The Assembly
has a council,
composed of individuals who hail from 18
countries, elected for 2.5 years.
This council, which
meets two times
each year, setting policy and overseeing IFAC
operations. Daily administration conducted by the IFAC Secretariat,
located in New York,
which has a staff
of accounting professionals
from around the world.
Most of the professional work done by committee
remains IFAC. At
the time of this writing, the
committee remains consist of:
1. Auditing Standards Board and the international insurance
2. Suitability
3. Education
4. Ethics
5. Professional Accountants in Business
6.
Public secto
7.
The International Auditors
Sometimes IFAC Council appoint a
special task force to discuss
important issues. At the end of 2002 there were two
task forces:
·
Rebuilding Public Confidence in
Financial Reporting (Credibility)
·
Small and Medium Practices
Auditing and Assurance Standards Board International (International Auditing and
Assurance Standards Board) issued in
the IFAC International Auditing Standards (International Standards
on Auditing-ISA),
which consists of the following groups:
·
The Introduction
·
Responsibility
·
Planning
·
Internal Control
·
Audit Evidence
·
Use of the Work of Others
·
Audit Conclusions and Reporting
·
Special Area
·
Related Services
IFAC has had a close relationship with other international organizations, such as the IASB and
IOSCO. The financial statements of companies audited
by the increasing number of compliance by
IFAC International Auditing Standards.
5. Intergovernmental Working Group of the United Nations
expert in the
International Standards for Accounting
and Reporting (Isar)
Isar was formed in 1982 and is the only
inter-governmental working group to discuss accounting
and auditing at
the corporate level. Particular mandate
is to encourage
the harmonization of national
accounting standards for companies. Isar realize this
mandate through discussion
and adoption of
best practices, including those recommended
by the IASB. Isar
is an early supporter
of the environment reporting and a number
of recent initiatives focused on
corporate governance and accounting for small
and medium sized companies. Isar also has conducted
technical assistance projects in several areas, such as
accounting reform and retraining at age
Federation, Azerbaijan and Uzbekistan, as well
as designing and developing
distance learning programs in accounting
for African countries that speak French.
6. Organization for Economic Cooperation and Development (OECD)
OECD is an international organization advanced industrial countries-oriented market economy. Activities
carried out by the
implementing agency, the Council of the OECD, and a network consisting of 200
committees and working groups. Publication called Financial Market Trends,
published two times a year, discussing trends and
prospects in international
and domestic financial markets that exist in
the major OECD regions. Description and analysis of the structure and rules of the securities market is often published
as a special
publication of the OECD or in the Financial Market Trends. With a membership
consisting of the
advanced industrial countries
is greater, the
OECD is often a formidable
opponent against the other bodies
(such as the United Nations or the International Confederation
of Free Trade Union) which has a tendency
to perform acts
contrary to the interests of member-members.
E. Describe a new
approach to the European Union and relate it to
the European financial market integration.
In 1995 the EC adopted a new approach
towards harmonization of accounting, known as the
New Accounting Strategy. Commission announced that
the EU needs to move precisely
in order to provide
a clear signal that
companies are trying to do the recording
in the United States and other world markets
will still be able to survive in the EU
accounting framework. EC also stressed that
the EU strengthens its commitment to the international standard-setting process, which offers the most
efficient and quick
solutions to problems faced by companies operating on an international scale.
In 2000, the EC adopted a new financial reporting strategy. The
interesting thing about this strategy
is the proposed rule that all EU companies
listed in regulated
markets, including banks, insurance companies and SME (small and medium
sized enterprises), prepare consolidated accounts
in accordance with IFRS. EU Parliament
approved this proposal
and the EU Council
adopted the necessary legislation.
This regulation affects
approximately 7000 listed EU companies
(compared with nearly
300 listed EU
companies to use
IFRS in 2001). This
proposal is designed "to
encourage cross-border trade in financial services and
thereby create a market that
is completely integrated, with the
help of making financial
information more transparent and
can be easily compared."
In order to be legally binding, IFRS must
be adopted by the EC. Which is included in the above rule is "endorsement
mechanism" and the formation of two layers of settings Committee of
Accountancy (Accounting Regulatory Committee-ARC), an EU body with representatives from Member States. To
an IFRS will first technical examination and
opinion by the Financial
Reporting Advisory Group Settings
Europe (European Financial Reporting Advisory Group-EFRAG), a
private sector organization
comprised of auditors, compilers of financial statements, national standards makers
and other interested parties other.
Then the ARC to
recommend whether IFRS can (or can not) based
on whether IFRS is adopted in accordance with
the European directive in the public interest and conducive to European countries. Ratification of the EC end
of this process.
Endorsement of IFRS by the EC began in 2003 through the adoption
of all IASB standards and interpretations that exist (except for IAS
32 and 39, which
is being revised). Fourth and Seventh
Directives also amended
in 2003 to eliminate
inconsistencies between the old directive with
IFRS.
Finally, there have been developments
that are intended to strengthen enforcement of IFRS in Europe. In
2003, the Committee of European
Securities Regulators adopt Standard 1 on Financial Information. This standard contains 21 principles which aimed
to develop and
implement a similar approach in the enforcement of IFRS throughout the EU.
Referensi:
- Choi, Frederick D.S., and Gerhard D. Mueller, 2005., Akuntansi Internasional – Buku 1, Edisi 5., Salemba Empat, Jakarta.
- Choi, Frederick D.S., and Gerhard D. Mueller, 2005., Akuntansi Internasional – Buku 2, Edisi 5., Salemba Empat, Jakarta.
Tidak ada komentar:
Posting Komentar