INTRODUCTION

Communication and understanding have been an issue at hand since the early times. The numerous languages around the world, the different cultures and even different accents and grammar have been considered as a gap in communication and have created hindrances in uniting people. Though the world has figuratively become one platform as globalization has taken its spread, till recent times we face communication gaps across nations which in turn create interruptions in understanding.

Disruption between Standards

This interruption or communication gap creates trouble for international business or multinational corporations as well. The basic language barrier is enough for a disturbance between the nations to interconnect. In addition to this gap, which is now much bridged by help of translators and technology, there exists another disturbance in smoother transactions. This disturbance is in the Accounting standards, the standards or set of rules of reporting and recording the financial information.

All over the world different companies follow different accounting rules and standards on the basis of their country and its rules and standards. The accounting rules or financial reporting standards and then of course the analysis of these statements vary from one accounting standard to another. This variation creates difficulty in the investor’s decision making which causes major effects on the company.

One World One Accounting Harvard Case Solution & Analysis

Accounting standards

The major financing standards used, and discussed in the case are IFRSs proposed by the IASBand the other being the GAAPconformed by SEC (Security & Exchange Commission) in responsibility of FASB (Financial Accounting Standards Board)((IASB), 2016).The International Accounting Standards Board (IASB) is a private entity, operating independently and governing the IFRS (International Financial Reporting Standards), which proposes a collection of rules and standards of financial reporting. The GAAP is the prepared amalgamation of standards and principles for the purpose of financial reporting (Morrow, 2015).

For the bridgingthis gap, numerous countries have started adopting the IASB proposed IFRS to set a global familiarity of accounting standards.

IASB

International Accounting Standards Board (IASB) is the standard setting board for Accounting. It is operating independently as a private, not-for-profit body, headquartered in London, England. In 2001, IASB was formed as the successor of the International Accounting Standards Committee (IASC).

IASB is the organization which proposes globally accepted standards of IFRS. The IASB can be considered as an international level FASB that creates Internationally Accepted Accounting Standards and principles like GAAP(accountingcourse, 2017). The IASB does not allow certain transaction and methods of accounting which are deemed acceptable in GAAP, which is lesser complex than IASB standards.

The IASB committee is a body of 14 international members with recognized backgrounds in accounting, finance and auditing(Rouse, 2018).

FASB

Financial Accounting Standards Board (FASB) was formed in 1973 as the successor on the duties and tasks of Board of Accounting Principles.
FASB (Financial Accounting Standards Board) is an independent entity responsible for GAAP in the United States(Investopedia, 2016). The FASB has more detailed standards of Accounting and special-industry standards. To follow its various standards FASB has several sources to gather guidance of implementations and information of these standards..............

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