IFRS Assesment

The international financial reporting standards are international standards established to develop accounting principles that are globally accepted. The IFRS organization is charged with the responsibility of maintaining and developing extensible Business Reporting Language through one of its groups known as XBLR. The role of XBLR within the organization is to provide a standard electronic structure of storing and recording accounting records.Question 2All countries globally are under obligations to move towards IFRS accounting standards through their state and private sectors. Firms within countries might resist the change because of the new costs of retraining their workers about the new standards. Firms that have been working on an old accounting system might see the new system as an added baggage and resist change. The deadline time to change to the international financial reporting standard within countries should be set by governments through setting up policies and penalties for non-compliance. The penalties will make companies comply in trying to avoid risk of breaking the laws and losing their positive image. The adaptation should start with government organizations followed by listed companies in the stock exchange. Listed companies adjustment should be required to attract foreign investors and give clear picture of performance of the companies to foreigners. The government should organize workshops to encourage the private sector of the need of adapting to the IFRS standard. The seminars should provide teaching and publications of the new globally accepted standards. Organizations like central banks should strive to ensure every bank adapt to IFRS standards because of the global nature of their business dealings.To ensure compliance in private sector in countries like United Arab Emirates government should provide incentives to companies that adapt to the accounting standards. The government can provide tax exempts totaling to the cost used in retraining workers about the new standards. The exempts will make sure that the companies do not see the new measures as an added cost to their constrained budgets. Learning institutions within countries should be encouraged to start teaching their students using the new accounting standards. Teaching with the new accounting standards will ensure business get readily available work force to prepare accounting records using the required standards. The law in the United Arab Emirates should be repealed to force the unlisted companies to publish their accounts using the IFRS standards. The new change of law will reduce the low rate of adaptation of the new standards by existing unlisted companies.Question 3The necessity of a globally accepted accounting standards exist in the modern world. The necessity arises from the form of globalization taking place with companies opening subsidiaries all over the world. Companies in different countries are required to submit their annual financial statements for taxation purposes. The submitted accounting records have to be developed using the prescribed standards allowed in the particular country. Company running businesses in different countries with different standards will have problems in consolidating their accounting books. Consolidation will be important to carry comparison on the subsidiary that is making losses and profits. To …