Harmonization Is A Process
Enviado por vicente.doh • 3 de Mayo de 2014 • 964 Palabras (4 Páginas) • 247 Visitas
Accountants, auditors and information scientists around the globe are planning to harmonize accounting
information systems with the goal of creating one set of high-quality accounting rules to be applied around
the world.
Harmonization is used as a reconciliation of different points of view,
which is more practical than uniformity, which may impose one country’s accounting point of view on all
others
Without the common accounting system the cross-border portfolio and direct investment may be
distorted, the monitoring of management by shareholders obstructed, the contracting inhibited and the cost
of these activities may be needlessly inflated by complex translation (Meeks and Swann, 2009).
The usage of harmonized international accounting system leads to a reduction of the information asymmetry between the owners and the managers.
This study found that IFRS adopters had a higher frequency of large negative net income and generally exhibited higher accounting quality in the post-adoption period than they did in the pre-adoption period.
Prior researches, for example, Meeks and Meeks (2002) have raised substantial doubt regarding
whether a global accounting standard would result in comparable accounting around the world. But
differences in accounting practices across countries can result in similar economic transactions being
recorded differently.
No matter how similar the accounting systems in different countries are, there will be slight or even
bigger differences in the way they are applied by companies due to the differences in the economical,
political and cultural environment.
The next hypothetical classification by Doupnik and Perera (2007) based on some explanatory variables
for differences in measurement practices.
Classes:
- micro-fair-judgemental and commercially driven,
- macro-uniform government-driven and tax-dominated.
Sub-classes:
- business economics and extreme judgemental (Netherlands),
- business practice, professional rules and British origin.
Families:
- UK influenced and professional regulated (Australia, New-Zealand, UK, Ireland),
- US influenced and enforcement by SEC (Canada, Israel, USA).
- code-based and international influenced (Italy),
- plan-based (France, Belgium, Spain),
- statue-based (Germany, Japan),
- economic controlled (Sweden).
The result was a selection of nine factors:
type of users of the published accounts of listed companies,
degree to which law or standards prescribe in detail and exclude judgement,
importance of tax rules in measurement,
conservatism/prudence (e.g. valuation of assets),
strictness of application of historical cost (in the historical cost accounts),
susceptibility to replacement cost adjustments in main or supplementary accounts,
consolidation practices,
ability to be generous with provisions (as opposed to reserves) and to smooth income,
uniformity between companies in application of rules.
4.2 Directives
The directives are defining legal frameworks of the European Union, determining criteria and requirements
to be met in national law therefore they seem to be long-term regulations. Directives referring to general
accounting principles are as follows.
- 78/660/EEC 4th directive about the financial statement of companies;
- 83/349/EEC 7th directive about the consolidated financial statement;
- 86/635/EEC 8th directive about the certification procedure of the operation of certified public
accountants in charge of supervision and audit of the financial statements.
The directives contain the required minimum information of the financial statement, the compulsory
structure of the Profit and Loss Account and of the Balance Sheet, the criteria of evaluation of assets, the
...