International accounting is accounting for international transactions, the comparison between countries of different accounting principles and harmonization of accounting standards in the field of tax authorities, auditing and other accounting areas. Accounting must evolve in order to provide the information required in decision-making in the company in any business environment changes.
Here are the characteristics of the era of global economy:
A. International business
2. Loss of boundaries between States era of global economy is often difficult to identify the country of origin of a product or company, this is the case in multinational companies
3. Dependence on international trade
There are 8 (eight) factors that influence the development of international accounting:
A. Sources of funding
In countries with strong equity markets, accounting has focused on how well management runs the company (profitability), and is designed to help investors analyze the future cash flows and related risks. Instead, the credit-based system in which the bank is the main source of funding, accounting has focused on the protection of creditors through conservative accounting measurements.
2. Legal System
The western world has two basic orientations: the legal code (civil) and common law (case). In code law countries, law is a complete group that includes the provision of accounting rules and procedures that are incorporated in national law and tend to be very complete. In contrast, common law developed on a case by case basis without any attempt to cover all cases in which a complete code.
3. Taxation
In most countries, tax rules effectively set the standard because the company should record revenue and expenses in their accounts to claim it for tax purposes.While a separate tax and financial accounting, tax rules sometimes require the application of certain accounting principles.
4. Politics and Economics Association
5. Inflation
Inflation causes the distortion of historical cost accounting and affect the propensity (tendency) of a State to apply the changes to the accounts of the company.
6. Levels of Economic Development
These factors influence the types of business transactions are conducted in an economy and determine what is most important.
7. Level of Education
Standard accounting practices are highly complex would be useless if misunderstood and misused. Disclosures about the risks of derivative securities will not be informative unless it is read by the competent authorities.
8. Culture
Four dimensions of national culture, according to Hofstede: individualism, power distance, uncertainty avoidance, masculinity.
Dimensions Affecting Value Accounting Accounting Practice:
A. Professionalism versus control mandatory preference to the implementation of individual professional balance and regulation of their own professional circles as compared to the compliance with legal provisions that have been determined.
2. Uniformity versus flexibility preference for uniformity and consistency compared to the flexibility in reacting to a particular situation
3. Conservatism versus optimism
4. Confidentiality versus transparency preference for confidentiality and restrictions on business in accordance with the basic information need to know than the willingness to disclose information to the public.
The reasons for Go International company:
A. Theory of comparative advantage pf
2. Imperfect market theory
3. Product cycle theory
4. Technology transfer and Strategic Alliance
The challenge for the accounting profession in the development of accounting:
A. Skill and competency of
2. Understanding the Cross Functional Linkages, accountants are not only quite proficient in the techniques, procedures and accounting standards but should also be used to view the business as an integrated form. Such as: product quality, production flexibility and the ability to produce and export quickly to win the global competition bias
3. Financial analysis and comparison
Posting Komentar