Essays on Comparability

The ongoing internationalization process persuaded regulators and businesses worldwide to think of a common global accounting language for business affairs. This move led to the development of IFRS. International Financial Reporting Standards (IFRS), sometimes referred to as International Accounting Standards, is a globally recognized accounting framework for businesses worldwide. The major purpose of this accounting standard is to make company accounts understandable and comparable across international boundaries. Currently, over 110 countries are following the IFRS accounting system in order to address complexities relating to international business affairs. However, the United States has not adopted IFRS yet, and the country ...

The Financial Accounting and Standard Board (FASB) and the International Accounting Standard Board (IASB) apply to the AT&T Mobility because both are proposing changes in global accounting. Moreover, their rule provides more incentives for companies particularly in changing the terms of the contract in corporations to speed up revenues to achieve quarterly targets. Additionally, the treatment of revenues in AT&T Mobility, the proposal for the changes, may drive the inconsistent allocation of income in particular between its products and payable resources as well as the separation of hosting arrangements. Consequently, AT&T have changed its GAAP accounting to redefine the ...

Introduction

Mark to market, also called fair value accounting, has been one of the most controversial accounting methodologies in financial reporting. Mark to market refers to an accounting process in which the reporting entities report the value of assets and liabilities as per the current market value as opposed to the book price thus making the methodology highly subjective (Association of American Bankers, 2016: Serakibi, n.d.). Therefore, since the reported value is pegged on the prevailing market value, it follows that the value of the financial statement would change as the market changes. In most cases, the change in value ...

H1 This hypothesis should test if IFRS adoption improves accounting quality in R&D firms. However, many research studies that have been conducted established that lower predictability and persistence in earnings. There is also a decrease in earnings influence to stakeholder value, weak volatilities in prices charged by markets, better predictability of cash flow of a company as well as financial predictions. Also, there is a rise in accruals together with timeliness loss of recognition as well as a reduction in expenditure on research and development. According to Ahmed, Neel, and Wang (2012), their study established that increase in income ...

General accepted accounting standards (GAAP) are acceptable framework and guidelines in accounting practice, used by professional accountants to record financial statements and position of a company. Therefore, this comprises of accounting and reporting standards, meant for both profit oriented firms and non-profit-oriented firms. On the other hand, according to (ken,2013) International Financial Reporting Standard (IFRS) is a global business language used in company circles so that their accounting documents and reporting are standardized. This, therefore, means that they are somewhat comparable across the industry, hence shareholder and stakeholders can make educated investments decision. IFRS is commonly used for ...