report on international financial reporting standard

Topics: International Financial Reporting Standards, Financial statements, Balance sheet Pages: 14 (4325 words) Published: January 21, 2014


MBA PROGRAM
PREPARED BY: - ID NO
1. BISRAT ALBACHEWGSR/2005/06
2.ISRAEL BIRHANU GSR/2021/06
3.SIYUM MENDA GSR/2034/06
4.YIBELTAL BITEW GSR/2041/06
SUBMITTED TO:- INSTRUCTOR: Dr.P. Laxmikantha December 2013 Table of content
Title Page 1. History of International Financial Reporting Standards (IFRS) …………… 2 2. Advantages and Disadvantages of Adopting IFRS ……………….. 4 2.1. Advantages…………………………………………………………………………4 2.2. Disadvantages………………………………………………………………………………..5 3. Similarities and Differences between IFRS and U.S.GAAP......6 3.1. Similarities between IFRS and U.S. GAAP.......................................7 3.2. Differences between IFRS and U.S. GAAP……………………………………..10 4. International Accounting Harmonization…………………………...11 4.1. Why International Accounting Harmonization………………11 5. Adoption of IFRS around the world…………………………………….12 6. Progress of Ethiopia towards the adoption of IFRS……………..13 7. Back ground of the Organization……………………………………………… ..14 9. Application of IFRS in United Bank S.C…………………………………15 10. Conclusion…………………………………………………………………………..20 Appendices

Introduction
International Financial Reporting Standards (IFRS) is a comprehensive, globally accepted set of accounting standards utilizing a principles-based approach with a greater emphasis on interpretation and application of those principles, aiming at best reflecting the economic substance of transactions. It is a less extensive body of literature than U.S. Generally accepted accounting principles (GAAP) with limited industry guidance and lesser detailed application guidance. IFRS requires a much greater exercise of judgment, supported by detailed analysis and documentation. In other words, U.S. GAAP gives us a detailed instruction to the location where we would like to go where us IFRS will just guide us to the destination by showing us the direction. In this paper we will briefly (since it is a wide concept) discuss about International financial reporting standard (IFRS), history and progress of IFRS, advantages and disadvantages of adopting IFRS, significant differences between IFRS and U.S. GAAP, adoption of IFRS in the world, and in Ethiopia, and finally we will assess its adoption in our case financial institution which is United Bank S.C.

1. History of International Financial Reporting Standards (IFRS) 1973
International Accounting standard committee was formed by the accountancy bodies of 9 countries. In this year again financial accounting standard board(FASB) was formed. 2001
International accounting standard board (IASB) was formed.
2002
Financial accounting standard board and international accounting standard board signed "The Norwalk Agreement" in which they commit to reduce differences between US GAAP and IFRS, initiating conversion efforts. On 19 July 2002 a regulation was passed by the European Parliament and the European Council of Ministers requiring the adoption of IFRS: Regulation (EC)No 1606/2002 of the European Parliament and of the Council of 19 July 2002 on the application of international accounting standards . As a result of the Regulation, all EU listed companies were required to prepare their financial statements following IFRS from 2005.

2005
More than 7000 listed entities in Europe adopt IFRS as approved by the European union. In this year different countries like Australia, New Zealand, and south Africa adopt IFRS as approved by their respective governments. 2006

Financial accounting standard board and international...

References: Web. Retrieved documents , December, 2013;
Investopedia, http://www.investopedia.com/articles/financialcareers/09/ancient-accounting.asp
The Adoption of International Financial Reporting Standards (IFRS) in Ethiopia: Benefits and Key Challenges, Fikru Fantahun, Thesis Paper submitted to Department of Accounting and Finance, College of Business and Economics, 2012
Mihret, D.G
Annual report of United Bank S.C. as of June 30 2013
ROSC (2007), Report on the Observance of Standards and Codes Ethiopia.
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