Accounting Interview Question:

What are the effects of international accounting standards on accounting practices of developing nations?

Submitted by: Administrator

Adoption of international accounting standards is extremely costly. Developing counties usually use accounting standards that are most beneficial to them (based on who they trade with to ease accounting for transactions) or just another country's GAAP that works for the developing country. Ex. Mexico very closely resembles U.S. GAAP because of NAFTA and the quality of U.S. GAAP.

Should IFRS be implemented in developed counties, developing counties might be forced to adopt them as well in order to maintain trade relations. This could be extremely costly for smaller developing counties.
Submitted by: Administrator