It's a beginner dose for getting starting IFRS standards. I will be trying to explain in my next few postings IFRS standards. However this one is just a short idea about how it all started and where are we standing right now. Excited? hmm.. Let's crack it.
Accounting standards around the world have evolved over centuries of business and capital market development. In this process, accounting standards historically were designed to meet the needs of each nation’s capital markets. Those standards that were found to work well in the legal, cultural, political and economic context of each nation became the “generally accepted accounting principles,” or GAAP, for that particular jurisdiction. Naturally, different norms in each nation led to different GAAPs in each nation. Generally, each country has it's own GAAP such as, Australian GAAP, US GAAP etc.
The growing dynamic of globalization presented a challenge to these “legacy systems.” Global protocols for the internet, electronic payments, software systems and cargo shipping demonstrated the potential value of uniform global systems. A discussion began among market participants over whether the global capital markets would similarly benefit by having a single set of high-quality accounting standards that could be applied around the world.
In order to create a uniform global system for financial reporting, the IASB was formed to serve as the global accounting standard-setting body. (See sidebar for more information on the IASB.) In 2001, the IASB promulgated the first iteration of IFRS, offering the possibility of a single set of high-quality accounting standards that could be used by all nations.
About the IASB
The IASB is based in London and is overseen by the International Accounting Standards Committee (IASC) Foundation, which is a private, not-for-profit corporation. The IASC Foundation is governed by 22 trustees from geographically diverse backgrounds. The IASB is comprised of 15 members from different nations around the world. The current board consists of members from five EU member-states, China, Japan, Australia, South Africa, Brazil and five
Americans. The IASB is funded through national levies as well as voluntary contributions from around the world, including large international companies, regulators, standard setters and international accounting firms.
No comments:
Post a Comment