Wednesday, November 27, 2019

The International Financial Reporting Standards a Report on the Roadmap and Roadblocks to Implementation free essay sample

A Report on the Roadmap and Roadblocks to Implementation in the US and Abroad Robert B. Shaw Term Paper Prof. Paul Strohmenger GBA 521 002 Financial Accounting and Reporting Fall Semester December 2010 2) how is it progressing? 3) how does it differ from GAAP? 4) will it be implemented how? The International Financial Reporting Standards, otherwise widely known as the IFRS, are a set of high quality financial reporting standards that are designed to be used globally by profit making enterprises. The continuous development of such international standards is an example of the international harmonization witnessed in the global financial sector over the last two to three decades. The history of the IFRS only spans the length of a decade or so and can be best summarized by the following milestones. (www. ifrs. org) In 2001, the International Accounting Standards Board (IASB) and the International Accounting Standards Committee (IASC) Foundation were formed. The next year the European Union passed regulation to adopt IFRS for listed entities in the year 2005. We will write a custom essay sample on The International Financial Reporting Standards: a Report on the Roadmap and Roadblocks to Implementation or any similar topic specifically for you Do Not WasteYour Time HIRE WRITER Only 13.90 / page In addition, the FASB and the IASB signed the â€Å"The Norwalk Agreement† which was a commitment to reduce differences between US GAAP and IFRS. This was the beginning of all the conversion efforts that are presently in process today. By the year 2005, nearly 7,000 listed entities in Europe adopted IFRS. The following year brought about an announcement from the IASB regarding a â€Å"three year stable platform period,† in which entities that have already adopted IFRS will not need to implement new IFRS until 2009. In 2007, the SEC removed the reconciliation requirement for non-U. S entities reporting under IFRS. This single act brought about further pressure from all the parties in the global financial community to further support IFRS. A proposed roadmap was published in 2008 by the SEC which identified potential mandatory adoption of IFRS by U. S. Filers. Finally, the most recent major actions in relation to IFRS were the reluctance to fully support the roadmap to IFRS by the Mary Shapiro, the current SEC Chairman, and the Group of Twentys (G20) support of IFRS as the most important step towards reforming the current global financial system. www. iasb. org) The IFRS was originally established by the International Accounting Standards Board (predecessor is the International Accounting Standards Committee? ) and its located in London, UK. The IASB is a full time organization, and functions independent of preparers, auditing organizations, and accounting agencies. The IASB has 14 board members which consists of a balance of financial industry leaders. These le aders are appointed based on their technical expertise as well as their experience in their respective fields. This ensures that the balance between these diverse groups produces a set of standards that satisfies the needs of the various users in the ever-developing, global version of the investor-creditor financial community. (www. kpmg. com) It is now apparent more than ever that the world is attempting to come together in the accounting and financial reporting arena. As it stands, the US adheres to its own Generally Accepted Accounting Principles (US GAAP) while the rest of the world has gradually accepted that the IFRS standards are needed and welcomed. This is due to the fact that capital resources are required around the world. Therefore, investors need a uniform set of standards and this is further supported by the open acceptance by international organizations such as the G-20. The original goal of the IASC was to have onset of standards so that every investor in the world would understand the principles that go into the creation of corporate financial reports and corporate financial statements. Those in support of the IFRS argue that global accounting standards will improve the functioning of global capital markets by providing better information to investors and other users of financial statements. They will achiever this by decreasing the cost of preparing and interpreting financial statements and reduce the cost of capital. Some of the additional benefits are specific to certain groups. The capital markets will benefit from enhanced world wide comparability for investors and more efficient capital allocation. In addition, foreign investors will perceive enhanced credibility of local market entities while US securities will be suitable for foreign listings. Finally, the IFRS will eliminate the need to develop and maintain national standards. On the other hand, the benefits to companies include easier consolidation and cross-border acquisitions and increases the overall understanding of the financial statements of overseas suppliers, customers, vendors, and subsidiaries. However, though the benefits seems very clear to the global financial community, there seems to be an apparent hesitation on the part of the US to adopt or immediately identify specific intent to implement IFRS. The notion is that IFRS doesnt have strong guidance and will lead to further chaos. Especially, if it is accepted in haste. www. bcbs. org) In relation to the progression of acceptance abroad there is a stark contrast between those who support IFRS and those who do not. Since 2000, with the creation of the IASB and its takeover from its predecessor, the acceptance of these standards saw a substantial increase in its use, especially by European countries. Switzerland was one of the first major countries to apply the standards. All of the major fina ncial markets in the world recognized the standards after Australia and the European Union recognized the standards. The United States has yet to adopt the standards as the SEC still subscribes to the US GAAP regulations and standards. These standards are primarily for listed companies but each jurisdiction may adjust the standards to their particular needs. The point of having one set of financial reporting standards is for investors to invest time into understanding only one set of principles that is useful for all investors. However, it doesnt limit the corporation from using other reporting tools or options. As it stands, the SEC is interested in IFRS but the question must be asked: What are the incentives? Why would the SEC be interested in converting from GAAP? Mary L. Schapiro, SEC Chairman since 2009, has stated that she is committed to convergence and has a roadmap to implementation in place. The SEC currently has a 5 year plan that doesnt specify a date for adoption. There is an opposition that exists within the US and there is evidence that supports there position. The details of the standards are flexible in that they may be changed in regards to the details of interpretations, recognition, and alternatives in reporting. (www. sec. org) The US is hesitant to rapidly implement this reporting standard for two main reasons. One is the US Taxation system and the other is the need to have trained professionals prepared to handle this workload. To expand on this, these are the requirements necessary for the potential use of IFRS in the U. S. The requirements are improvements in the accounting standards, the accountability and funding of the IASC Foundation, the improvement in the ability to use interactive data for IFRS reporting and the immediate need for education and training. However, the SECs roadmap is actually a 5 year convergence plan. There are three areas of concern that are key to the SEC Chairman. They include the pace of the timeline, the independence of the IASB and the cost of the IFRS adoption. These concerns are all valid, but it is more likely that this delay is truly due to the change in the political party that is currently in office. (www. sec. org) The global perspective is different as GAAP exists for each country independently in that each has they each originally had their own respective set of standards. Approximately 110 of the 195 countries on the planet have accepted IFRS. The this unbalanced acceptance has the SEC under significant pressure to address the idea of quickly implementing a unified set of globally accepted standards in addition to the development of competitive exchange markets. Nonetheless, the idea of adopting IFRS originally came up in 2007 when the SEC decided to excluded a long-standing requirement by incorporating the use of IFRS to substitute certain GAAP requirements for corporations that were established in other countries. There is also the likelihood that the SEC may be attempting to increase its position in the global market by accruing power as the global regulator of corporate standards by delaying the implementation and leaning towards the idea of convergence. The Big Four, which was actually once known as the Big Eight prior to mergers, are all for the requirement for corporations to adhere to IFRS as it poses an opportunity for an thrust in the demand for financial consulting services and increased earnings. Thus, the question that must be answered is whether or not IFRS is truly better than the current GAAP system in place in the United States. The reality is that each country has historically had its own set of standards to which it adhered to. Some are better than others. For example, France has been said to have a weaker set of standards in comparison to that of the United States. Therefore, the IFRS would be better suited for a country with a weak set of standards to consider as it would be an immediate improvement and allow that country to be in the collective of those who already subscribe to IFRS. (www. deloitte. com) When one considers the cost-benefits associated with the use of IFRS in the United States they vary due to the variety of stakeholders involved. The reality is that costs have not been sufficiently quantified by the SEC, however, estimates state that the cost associated in conforming to these standards may range in the area of 1% 3% of an organizations total revenue. In addition, audits are more likely to incur a heavier costs in the future as there will only be so many parties trained to handle such matters as it is totally new to the industry on a whole. The cost will also affect educators as they scramble to develop curriculums and select ufficient literature to support the demands to produced knowledgable and qualified employees for the financial services market. The issue that many will face in the varied fields associated with IFRS is the challenge of shifting from a rules based system of financial accounting and reporting to a principles based system. The key to the successful recognition of the IFRS standards will be the goal of convergence. The reason many are willing to wait on subscribing IFRS in the U. S. Is the concern for the conflict of standards based on principles versus rules. The US GAAP standards are developed on specific rules, while the IFRS are strictly principles based. This means that IFRS are very limited. They seek out to provide the same results but the keys to doing so may result in different answers. This is where the convergence process will suffice in bringing all parties to a consensus on how to best apply the standards. The reality is that the US accounting industry and the global financial system ought to be fairly pleased with this open support, but investors, companies and firms continue to be in the dark on the exact date of this transition.

Saturday, November 23, 2019

Free Essays on Bodega Dreams

Bodega Dreams The novel Bodega Dreams, written by Ernesto Quinonez, appears to suggest that in the case of the antagonist Willie Bodega, the ends do justify the means. Though positive results were manifested in the community, the way in which they were accomplished were far from positive. The controversially ethical issue of whether the end justify the means or the means justify the end seems to be the concern of the novel. In history many peoples’ lives have been destroyed to improve the gain of others. The forefathers of this country murdered and destroyed Native Americans’ lives for their own personal gain, Germans murdered Jews for their own gain, and like Willie Bodega drug dealers sell drugs for their own financial gain. Though some people attain success in a less extreme manner, for instance, one may see a co-worker being fired as an opportunity for a promotion. The novel seems to suggest that in order to attain success one will inevitable be forced to step on people on the way up. Analyzing Willie Bodega’s rise to the top, how he got there, and his reasoning for the way he got there, will help to develop an understanding for t he reason why the novel suggests that the means do justify the end ends. The novel opens by introducing the protagonist and narrator Julio Mercado also known as Chino and his life long best friend Enrique, also known as Sapo. The novel introduces the two characters during their childhood growing up in the ghettos of East Harlem New York, better known as Spanish Harlem, to explain how their friendship began and developed. During their years in school Sapo would always take up for Chino and even fight for him. The novel is constructed into three books in which refer to its chapters as rounds, which symbolically represents the struggle within their Spanish Harlem neighbor hood and how one literally has to become a fighter and fight to survive the adversity and destitution forced upon residents... Free Essays on Bodega Dreams Free Essays on Bodega Dreams Bodega Dreams The novel Bodega Dreams, written by Ernesto Quinonez, appears to suggest that in the case of the antagonist Willie Bodega, the ends do justify the means. Though positive results were manifested in the community, the way in which they were accomplished were far from positive. The controversially ethical issue of whether the end justify the means or the means justify the end seems to be the concern of the novel. In history many peoples’ lives have been destroyed to improve the gain of others. The forefathers of this country murdered and destroyed Native Americans’ lives for their own personal gain, Germans murdered Jews for their own gain, and like Willie Bodega drug dealers sell drugs for their own financial gain. Though some people attain success in a less extreme manner, for instance, one may see a co-worker being fired as an opportunity for a promotion. The novel seems to suggest that in order to attain success one will inevitable be forced to step on people on the way up. Analyzing Willie Bodega’s rise to the top, how he got there, and his reasoning for the way he got there, will help to develop an understanding for t he reason why the novel suggests that the means do justify the end ends. The novel opens by introducing the protagonist and narrator Julio Mercado also known as Chino and his life long best friend Enrique, also known as Sapo. The novel introduces the two characters during their childhood growing up in the ghettos of East Harlem New York, better known as Spanish Harlem, to explain how their friendship began and developed. During their years in school Sapo would always take up for Chino and even fight for him. The novel is constructed into three books in which refer to its chapters as rounds, which symbolically represents the struggle within their Spanish Harlem neighbor hood and how one literally has to become a fighter and fight to survive the adversity and destitution forced upon residents...

Thursday, November 21, 2019

Law of Torts Case Study Example | Topics and Well Written Essays - 2500 words

Law of Torts - Case Study Example The inherent ambiguity as to what conduct will constitute an interference with the use and enjoyment of land in order to justify an action in private nuisance has facilitated the piecemeal development of legal principles in this area2. This is further evidenced in context of environmental litigation3. Moreover, it has been widely extrapolated the law of nuisance is the most significant course of action in respect of environmental disputes4. However, commentators have criticised the multifarious limitations in private nuisance claims, which further render inherently complex cases difficult to be brought to court with any realistic prospect of success5. Indeed, the very nature of a claim being available only when environmental damage directly affects the use and enjoyment of another person's land intrinsically limits the parameters of nuisance6. Furthermore, the decision in the case of Hunter v Canary Wharf7 renders private nuisance claims dependant upon demonstration of a proprietary interest in the land, which has fuelled academic debate regarding the decision's implications for private nuisance claims8. The focus of this analysis is to evaluate the implications of the decision in the Hunter case, particularly in context of the development and application of the strict liability rule in Rylands v Fletcher9. Firstly it has been submitted that the arbitrary nature of judicial developments in private nuisance claims would alternatively be better addressed by the strict liability rule as established in Rylands v Fletcher10. The Rylands rule relates to the situation where a non-natural land user keeping something on their land, which is likely to escape, and as such, is stated to be kept at their own peril11. If the "thing" does escape, the rule affirms that the individual will be liable for all damage that is a natural consequence of the escape12. In the Rylands case itself, the defendant was a mill owner who had employed an independent contractor to build a reservoir on his land. The contractor had been negligent in failing to block a disused mine shaft that he had come across on the site. As a result, when the reservoir was filled, water escaped causing damage. As the contractor was independent the landowner was not liable for negligence or vicariously liable for the contractor's conduct13. In delivering the judgement for the claimant, Blackburn J asserted "the rule only applied to a thing which was not naturally there14". Furthermore, Lord Cairns presiding in the House of Lords additionally qualified the applicability of the Rylands rule to where the defendant had actually brought the thing onto his land15. The rule was further developed in the decision in Reads v Lyons16 by determining that one cannot claim for personal injuries in private nuisance but only for the discomfort caused to the use of the land itself17. The essence of the rule is that it is a form of strict liability for the escape of 'things' likely to cause damage and which have been brought onto land18. On the one hand the strict liability rule in Rylands leans towards legal certainty in this complex area of law by